India and Australia are rushing into each other’s arms due to China’s rising belligerence in the Indo-Pacific region. In recent weeks, both countries have moved to heighten trade and military reciprocity. The timing is not coincidental, coming close on the heels of aggressive military and economic moves by China in the region.
On June 4, Indian Prime Minister Narendra Modi and Australian Prime Minister Scott Morrison signed seven agreements, including one that bolsters military cooperation with the Mutual Logistics Support Agreement; another that strengthens economic ties to the level of a Comprehensive Strategic Partnership; and a third that fortifies mutual security on the seas in the form of a “Shared Vision for Maritime Cooperation.”
The depth and breadth of the accords and the speed with which they collectively came together speaks to the shared concern over China’s broadening strength, influence and aggressiveness.
India and Australia have historically enjoyed positive relations and have been pursuing a tighter alliance for the last few years, but their mutual — and growing — distrust of China accelerated this quest.
India is on the wrong side of a massive trade debt with China, one of its largest trading partners. While the deficit declined between 2018 and 2019, it remains a whopping $56.8 billion. Fueled by the belief that this deficit is the result of China simply “dumping goods” on India and anger over the novel coronavirus’ origins in China, trade between the two most populous countries in the world declined by seven percent in Fiscal Year 2020 — impetus for India to increase trade with other countries.
Additionally, India is currently engaged in a military standoff with China at the disputed border in the Kashmir region. The tense situation began with multiple skirmishes in early May and escalated with a violent confrontation on June 16 that left at least 40 Indian soldiers dead. This is the latest manifestation of decades-old hostility between two countries over control of territory in Kashmir. The Kashmir conflict is unlikely to be resolved anytime soon, and if anything, will only grow more heated as India becomes increasingly wary of China’s aggression elsewhere in the Indo-Pacific, in places such as Hong Kong and the South China Sea.
Meanwhile, Australia also is experiencing rising trade tensions with China — its largest trading partner — after calling in April for an international investigation into the origins and early spread of the coronavirus. In response, China placed tariffs on Australian barley and banned Australian beef imports in May. Then, in early June, China’s Ministry of Culture and Tourism discouraged its citizens from traveling to Australia and warned students about studying there due to an increase in anti-Chinese and anti-Asian attacks. These were all major blows to “the world’s most China-dependent developed economy.”
Thus, a major deal between India and Australia — two of the Indo-Pacific’s largest democracies — made perfect sense as a way to transition out of economic over-reliance on China and counter China’s regional aggression. Indian Prime Minister Modi jubilantly claimed that the diplomatic landmark with Australia would help both nations fulfill their “sacred responsibility” to defend democracy, rule of law, and international institutions.
The Mutual Logistics Support Agreement is a military accord. It will allow India and Australia to refuel military ships and aircraft and utilize maintenance services at each other’s military bases and ports. This will not only provide both countries’ armed forces with a greater footprint in the Indo-Pacific, but also encourage future joint military exercises and coordination. In addition, by pooling security resources, India and Australia hope they can serve as a unified stalwart against Chinese military adventurism.
Meanwhile, the particulars of the Comprehensive Strategic Agreement are primarily economic. As part of the pact, India and Australia agreed to increase trade and investment in the other’s technology and infrastructure. Prime Minister Morrison acknowledged that “trade and investment flows between” India and Australia “are not where [Prime Minister Modi] and I would like them to be, but they are growing.” From 2018 to 2019, India was Australia’s eighth-largest trading partner while Australia was not even one of India’s top 10 trading partners. Given how little the two middle powers currently trade with one another, the potential to boost each others’ economies is immense.
The “Shared Vision,” while largely rhetorical, is important in that it projects unity between India and Australia. It also lays a roadmap for achieving shared regional interests, especially in regard to maritime security. Specifically, one goal of the Shared Vision is to create a multilateral organization called the “Indo-Pacific Oceans Initiative” (IPOI) that will facilitate a “safe, secure, and stable maritime domain” in the region. The Shared Vision also calls for Indian-Australian maritime cooperation at every level: “bilateral, regional, multilateral, and minilateral.” This Shared Vision seeks to intertwine India’s and Australia’s maritime security destinies and ensure that China does not get to dictate military activity in the Indo-Pacific.
Only time will reveal the effectiveness of India’s and Australia’s enhanced relationship. Modi, for his part, is convinced the “partnership will play an important role” in global affairs. Moreover, with Chinese bellicosity on the rise, increasing uncertainty about the United States’ commitment to its allies under President Donald Trump’s leadership, and fears of a second Cold War, tightening bilateral relations appears to be a wise and timely move.