Australia and India | From Estrangement to Convergence

Introduction

In May 2023, Indian Prime Minister (PM) Narendra Modi received a rockstar’s welcome during his State visit to Australia, where he was received by his Australian counterpart Anthony Albanese. Albanese reflected on Australia’s relationship with India and the growing number of Indian immigrants in Australia, suggesting that they had “brought the spirit of the world’s biggest democracy to Australia” and had “helped make our democracy stronger and more inclusive” (The Guardian, 2023). In a speech to the national parliament, Albanese lobbied for the pursuit of closer ties with New Delhi and the conclusion of a new trade agreement that would boost economic connectivity on top of existing agreements regarding the cooperation on security, defense, and critical minerals. Reflecting the growing emphasis on India in Australian foreign policy, the Australian Department for Foreign Affairs and Trade (2023) has highlighted India’s role as an Indo-Pacific partner with “a shared vision for a resilient, inclusive and open region” and noted that “that no country would offer more growth opportunities for Australian businesses than India over the coming decades”. In both strategic and economic terms, India has emerged as a key focal point in Australian foreign policy.

The affection characterizing contemporary Australia-India relations has historically not been a foregone conclusion. During the Cold War, India’s role in the non-aligned movement and Delhi’s defense and diplomatic relationship with the Soviet Union irked Australian policymakers who sought to firmly embed Australia in the American camp in return for security guarantees from Washington. Although bilateral trade expanded following the collapse of the Soviet Union, Australia’s opposition to India’s nuclear weapons program and accompanying sanctions limited the scope of the bilateral relationship.

The current convergence between both countries is driven by a variety of factors. A growing number of Indians have migrated to Australia for work and education purposes, strengthening a close cultural relationship shaped by the legacy of British colonialism and sporting rivalries, especially in cricket. India’s growth potential and growing economic liberalization further generates commercial opportunities for both sides given Australia’s richness in natural resources and India’s growing service industry. On a larger strategic level, however, both Canberra and New Delhi are concerned by the regional order ramifications of China’s military and economic ‘rise’. As China has begun to perform a more economically and strategically assertive role, the US-led regional order has been called into question. Beijing’s growing economic influence also creates trade and connectivity exposures for Australia and India. Further, China’s military build-up and ongoing tensions along the disputed Himalayan borders with India present a major and worsening strategic headache for the Modi administration. This has driven a greater strategic convergence between Australia and India, including in the Quadrilateral Security Dialogue (Quad) involving Japan and the United States.

In a time of heightened geopolitical competition, Australia has emerged as a major partner for India. While this does not necessarily indicate alignment in a traditional sense, it reflects a shift in India’s security posture in the face of an increasingly assertive China. This paper analyzes the drivers, frameworks, and impacts of the bilateral relationship between Australia and India. It initially traces the relationship until the early 2000s and examines the factors shaping the relative strategic estrangement between both countries up until that point. The paper then moves to elaborating the drivers of strategic convergence before discussing the four major pillars of bilateral collaboration: (1) institutional engagement and diplomatic frameworks, (2) economic ties, (3) maritime security cooperation, and (4) wider security and defense cooperation. The last section concludes the paper and reflects on the progress made so far and the challenges to be addressed in the coming years.

Australia-India relations until the 2000s

During the Cold War and in its immediate aftermath, Australian-Indian ties were dominated by an estrangement that came as a result of diverging strategic postures vis-à-vis the Soviet Union and the United States. Following the end of the Second World War, the US gradually replaced the United Kingdom as Australia’s primary security partner in the region as the UK began to reduce its military presence in Southeast Asia. While Australia became deeply embedded in the US-led security architecture in East Asia post-1945, India leaned toward deeper ties with the Soviet Union and later emerged as a leading actor in the non-aligned movement, which reduced the opportunities for developing more comprehensive ties with Australia and other key partners of Washington in East Asia, including Japan and South Korea (Sharma, 2016). Indian strategic perceptions of Australia were improved slightly by Canberra’s diplomatic support for India during the Bangladesh war of liberation in 1971 that escalated into a military conflict between India and Pakistan in which the Nixon government largely supported the Pakistani position (Gyngell, 2017). During the 1980s, the two countries shared a relatively modest level of engagement that primarily manifested in limited trade connectivity and some people-to-people contacts. As will be discussed in further depth below, bilateral trade began to gradually grow from the early 1990s onwards, driven by India's domestic economic reform agenda and its growing consumption of Australian exports (mainly coal, minerals, and agricultural products) (Sharma, 2016). The collapse of the Soviet Union and India’s domestic reform agenda thus contributed to a slight thawing in the bilateral relationship.

Even as economic relations deepened, however, Canberra’s relationship with the US and its opposition to the Indian nuclear program proved stumbling blocks in the development of a relationship transcending mutual trading interests. In the 1990s, Australia's policy focus on the Asia-Pacific region and its close alliance with the United States continued to generate divergent perspectives on international relations and the regional order (Gopal & Ahlawat, 2015). Following India's nuclear tests in 1998, Australia, along with several other countries, imposed sanctions on India that contributed to strained diplomatic ties and hindered closer cooperation in various areas despite the simultaneous expansion of trade linkages (Saha, 2023). Although then Australian PM Paul Keating and Indian PM Rajiv Gandhi shared a close personal relationship, Australia had also opposed India’s inclusion in the then recently founded APEC (Asia-Pacific Economic Cooperation) multilateral, angering Gandhi and reflecting the continued impasses in the bilateral relationship (Gyngell, 2017). Even following the end of the Cold War, India’s suspicions regarding the US, Australia's close alliance with Washington, and Australia’s opposition to nuclear proliferation created limitations on the extent of the relationship.

While government-to-government interactions remained scarce, the shared legacy of British colonialism allowed for close people-to-people contacts. Although discrimination against non-whites remained a key issue in Australian society, the presence of a large and growing Indian diaspora in Australia has come to act as a bridge between the two nations, fostering cultural and people-to-people ties. Today, there are more than 700,000 Indians and Australian Indians living in Australia, making it the second-largest migrant group in the country (Mollan, 2023). Australian research universities have also emerged as a major study destination for Indian students (Chandra, 2022). Furthermore, the cricketing rivalry between the Australian and Indian national teams has functioned as a platform for cultural exchanges and has helped to build connections between players and fans.

Throughout the Cold War and in the immediate period following the collapse of the Soviet Union, Australia-India ties were ultimately limited by India’s foreign policy emphasis on non-alignment, New Delhi’s suspicions regarding the United States and its perceived lackeys, which primarily stemmed from Washington’s support for Pakistan, and Australia’s opposition to nuclear proliferation programs. However, sports diplomacy, a growing Indian diaspora, and educational exchanges played a role in fostering a context of mutual understanding that subsequent cooperative initiatives have been situated in. The 1990s served as a transitional phase, gradually paving the way for the substantial strengthening of Australia-India relations in the 21st century.

Drivers of contemporary strategic convergence

Characterized by growing strategic and political cooperation as well as deepened economic ties, the bilateral relationship has been marked by significant changes over the past two decades. While a variety of domestic development and shifts in the strategic dynamics in the Indo-Pacific have contributed to this trajectory, shared concerns over the rise of China and its implications have been the primary factor driving the contemporary degree of strategic convergence between Australia and India, including in the framework of the Quad.

Questions regarding the implications of China’s military build-up, more hostile posturing, and growing economic influence throughout the region have presented major strategic challenges for governments in the Indo-Pacific. China has grown increasingly assertive in its conduct in territorial disputes, including on the Indian-Sino border, around major sea lines of communication (SLOCs) in the South China Sea, and in territorial disputes with Japan in the East China Sea (Crisis Group, 2021; Strating, 2021). Beijing has also ramped up its military presence in the Taiwan Strait while employing a series of gray zone tactics that have aimed at increasing the pressure on the Taiwanese government and asserting China’s claim over the island (Tsui, 2022). Further, China’s de facto abolition of partial self-rule in Hong Kong has raised further questions regarding China’s long-term plans for Taiwan (Maizland, 2023). Taken together, this growing hostility has intensified perceptions of China as a source of strategic instability and threat in the region. This conduct has been the main driver of closer cooperation between the Quad members, all of which share a common interest in upholding a security order that has been effectively guaranteed by the continued basing of the US Navy in East Asia after 1945.

While Australia and Japan have been long-standing US partners and treaty allies, India’s inclusion in the Quad indicates a significant shift in Indian foreign policy. While the Quad is not an alliance, India’s close collaboration with the US in particular marks a growing willingness in New Delhi to reconsider old partnership strategies and move toward a more multi-directional partnership model that maintains relations with Russia while deepening economic and strategic collaboration with non-traditional partners. For India, the concerns regarding China’s developing military posture have been further exacerbated by China’s rapid military modernization and the militarization of parts of the shared border in the Himalayas. China’s growing military prowess has clearly shifted the military balance in Beijing’s favor - cooperation within the Quad is thus partially aimed at reducing the strategic gap between China and India by entrenching India in wider strategic frameworks in the region.

Indian policymakers are also concerned regarding China’s growing economic presence in South Asia, which many view as an attempt to establish a wider, long-term military presence in the region. For India, China’s deepening economic relationship with Pakistan, the financing of infrastructure projects in South Asia via primarily untransparent loan practices as part of the Belt-and-Road Initiative (BRI), and the investment in potential dual-use ports in Sri Lanka and Pakistan have created major headaches (White, 2020). In response, India has sought to become a more active and inclusive investment partner in the Indian Ocean and assert its influence in a region it has historically considered its own backyard.

More generally, China’s growing capacity to exert economic coercion has been a driver of convergence between the Quad members. All four countries have engaged in some form of economic warfare with China in the past, facing sanctions and tariffs from China while imposing measures themselves (Cha, 2023). Through various China-led initiatives, including the BRI and the accompanying Asian Infrastructure Investment Bank (AIIB), China has also sought to develop a series of parallel, more China-focused governance structures that reduce Western and Japanese economic influence throughout Asia (Jorgensen, 2015). In all Quad countries, China’s increasingly hostile conduct has led to a decrease in public trust in China. In Australia, for instance, China’s imposition of tariffs on Australian barley, beef, wine, and cotton exports to China, coupled with China’s island-building projects in the South China Sea, has contributed to a significant deterioration in the relations between Beijing and Canberra and a shift in the perception of the Australian public vis-à-vis China (Reuters, 2023; Strangio, 2022). The intensification of shared concerns regarding China between the Quad members and a more open willingness and capacity to push back against Chinese conduct marks a significant shift in comparison to the Quad that was initially established in 2004 in response to the tsunami in the Pacific and the Indian Oceans (Envall, 2019). In 2007, Australia pulled out of the ‘first’ Quad after China threatened to impose tariffs on key Australian exports to China if Australia remained in what Beijing perceived to be an anti-China containment bloc (Flitton, 2020). As such, the diversification of trade relationships and the pulling of investment and manufacturing from China has been a major component of economic policymaking in the Quad (Spillner & Wolff, 2023). Australia’s more openly confrontational stance toward Beijing reflects the deterioration of ties and the intensification of threat perceptions regarding China among the Australian public and elite.

Australia, India, Japan, and the US also converge in their concerns on China’s technological advancements and cyber activities. China's rapid technological advancements and aspirations to operate as the global leader in emerging technologies have raised cybersecurity concerns and prompted the Quad countries to strengthen cooperation on cyber policy, including via the formulation of the Working Group on Critical and Emerging Technologies (Long & Chahal, 2022). The usage of cyber espionage, intellectual property theft, and the development of advanced surveillance systems by Chinese State-owned enterprises have increased the urgency to protect critical infrastructure, intellectual property rights (IPR), and data privacy (Bhattacharjee, 2023). Beijing’s growing cyber capabilities have also enhanced its ability to launch influence operations and disinformation campaigns to shape narratives, suppress dissent, and manipulate public opinion outside of China (Seldin, 2022). For the Quad, China presents a multi-domain challenge that necessitates a multi-domain response.

In terms of its strategic thinking, the ‘Indo-Pacific’ component of the Quad reflects the recognition of the increasingly geographically expansive challenges posed by China. In the strategic discourse of all Quad members, the concept of the Indo-Pacific has replaced the Asia-Pacific as the dominant discursive tool to describe the geographical scope of the Quad and its partnership(s). The Indo-Pacific notion, first developed by the former Japanese PM Abe Shinzo, reflects a broader rearticulation of the Indian Ocean and the Pacific as two strategically interlinked spaces that are mutually constitutive in economic and security terms (Sharma & Blaxland, 2022). India's "Act East" policy, which stresses Indian economic and infrastructure connectivity with Southeast Asia, and Australia's emphasis on the Indo-Pacific as a strategic priority have aligned their interests at a time of heightened geopolitical tension in the region.

Australia and India bring specific strategic advantages that contribute to the collective strength and capabilities of Quad. With major coastlines in both the Indian and Pacific Oceans, Australia is the only Quad member that is based in both spatial components of the Indo-Pacific. The Royal Australian Navy operates modern surface combatants, including frigates, destroyers, and submarines that can be deployed throughout the Indo-Pacific and that can leverage the strategic geography of the overseas territory of the Cocos (Keeling) islands. Further, Australia's extensive coastline, including its vast Exclusive Economic Zone (EEZ), provides strategic advantages in terms of enhancing connectivity to different areas in the Indo-Pacific, including the southern Pacific and the southern Indian Ocean. Australia's proximity to Southeast Asia and the Pacific Islands allows it to maintain close ties and provide maritime assistance to regional countries, which has emerged as a key space for Australian strategic engagement over the course of the 20th century (Gyngell, 2017). Its naval presence and cooperation with regional partners can enhance maritime domain awareness (MDA) capacities in the region and contribute to humanitarian assistance and disaster response (HADR) operations.

Its historical relationship with the United States furthermore contributes to institutionalized forums for strategic cooperation that improve communication and interoperability. Australia has historically supported US military interventions abroad to indicate its commitment to the strategic partnership, leading to close military collaboration in the wars and military interventions in Korea, Vietnam, Afghanistan, and Iraq, and the permanent basing of US military and intelligence assets in Australia (Gyngell, 2017). Australia's larger contribution to the Quad is situated in its security and defense relationship with the United States, the legacy of which positively contributes to interoperability, intelligence sharing platforms, and combined military operations. The close Australia-US ties were recently reasserted through the signing of the AUKUS pact also involving the UK, which is intended to further boost intelligence and technology sharing between all three parties and under which Australia will acquire US-built nuclear-powered submarines, a move that is key to boosting Australian subsurface capacities (Kahn, 2023).

While Australia and the US can provide a naval presence in the Indian Ocean, India is the Quad’s sole member firmly rooted in the geography of the Indian Ocean. Despite an expansion of bilateral and multilateral exercises in the framework of the Quad, the operational scope of the Indian Navy is likely to remain focused on the Indian Ocean as India aims to bolster its maritime presence in the region to balance China’s growing regional involvement (Tambi, 2023). India’s natural strategic reach extends from the Persian Gulf to the Malacca Strait, covering key SLOCs. Further, India can provide distinct intelligence capacities to the Quad due to its surveillance assets in the Bay of Bengal and the Andaman and Nicobar Islands. India has invested in expanding its intelligence-gathering capacities on the Andaman and Nicobar Islands to gain an improved insight into the subsurface activities of the People’s Liberation Army Navy (PLAN), which has significantly upgraded its surface and subsurface presence in the Indian Ocean in recent years (Baruah, 2022; Paneerselvam, 2022). India’s role and position in the Indian Ocean adds depth to the Quad's strategic calculus and strengthens the collective deterrence against potential coercion.

In both their bilateral relationship and their involvement in the Quad, Australia and India bring specific advantages to one another and the broader multilateral architecture. Australia's naval assets, Indo-Pacific connectivity, technological infrastructure, and alliance with the United States enhance the Quad's naval power projection, technological capabilities, and cyber defense capacities. India, in turn, provides a geostrategic anchor in the Indian Ocean.

Pillars of cooperation

While the Quad has played a key role in driving and structuring cooperation between Australia and India, significant progress has also been made on a bilateral level in the coordination on a variety of both security and non-security policy issues. The following sections will outline key components of the emerging relationship, focusing on the forums for institutional engagements and the relevant diplomatic frameworks, the development of closer economic ties, maritime security cooperation, and wider security and defense industry cooperation.

Institutional engagement and diplomatic frameworks

The late 2000s were marked by a series of important developments, especially on the Australian side, that have contributed to closer economic and strategic ties between Australia and India. The Strategic Partnership (SP), signed in 2009 by Indian PM Manmohan Singh and Australian PM Kevin Rudd and upgraded to a Comprehensive Strategic Partnership (CSP) in 2020, serves as the overarching framework for the bilateral relationship. The SP/CSP established a high-level platform for engagement and coordination in a variety of policy sectors, including defense, trade, investment, education, and science and technology (Sharma, 2021). The CSP has aimed at enhancing strategic dialogue, facilitating cooperation, and promoting a comprehensive and multifaceted relationship between the two countries (Australian Department of Foreign Affairs and Trade, 2020). A major boost for the relationship came from Australia’s decision to reverse its ban on uranium exports to India as part of its opposition to the Indian nuclear program. Initiated by then PM Sarah Gillard, the negotiations surrounding a removal of the ban were followed in 2012 by talks on a civil nuclear cooperation agreement (Gyngell, 2017). This agreement was signed into force by Gillard's successor Tony Abbott, elected in 2013. Under Abbott, Australian policy also increasingly focused on India’s role as a balancer to Chinese strategic presence in Asia. Following the signing of the civil nuclear cooperation agreement by Abbott and Modi, Modi visited Sydney in 2014, an event that drew large crowds of Australian Indians and Indian migrants. The respective party affiliations of Gillard (Labor Party) and Abbott (National Party) also indicated that support for closer diplomatic ties had emerged as a bipartisan foreign policy consensus in Canberra.

Fostering closer economic and strategic ties has been a key focus of agreements made over the past years. The Morrison government signed an extension to the SP, the CSP, that seeks to further boost defense and security cooperation. Further, the 2022 Economic Cooperation and Trade Agreement (ECTA) aims for the diversification of the bilateral trade relationship and the removal of tariffs, as will be discussed in more depth below (Sharma, 2022). Other key dialogue platforms include the Australia-India Strategic Partnership Dialogue and the India-Australia 2+2 Ministerial Dialogue, which have helped to facilitate discussions between key policymakers on a wide range of issues, including defense, security, trade, investment, and people-to-people contacts. The changes in the diplomatic ecosystem between both countries indicate a broader rearticulation of foreign policy priorities and partnerships, especially in Australia. The expanding number of agreements with Australia under the Modi government signifies the growing importance that is assigned to Australia in Indian strategic thinking and, crucially, the ability to deliver on the ambition of pursuing closer ties.

These agreements are situated in and have reinforced the creation of broader State-to-State diplomatic frameworks. The Australia-India Joint Ministerial Commission (AIJMC) serves as a key institutional mechanism to promote bilateral trade and economic cooperation. The AIJMC, first held in 1989, is co-chaired by the foreign ministers of both countries and brings together representatives from various sectors, including trade, capital investment, agriculture, education, and energy to oversee “a whole new trajectory of transformational growth” (High Commission of India in Australia, 2023). The commission provides a platform for discussions, policy coordination, and the identification of areas for cooperation, which strengthens economic ties and enhances people-to-people exchanges. Also relevant in the facilitation of closer economic ties are the Australia-India Business Council, the Australia-India CEO Forum, and the Australia-India Mining Partnership. These platforms provide spaces for business leaders and industry representatives to explore opportunities, foster trade and investment, and promote economic cooperation.

Regular visits by heads of State, government officials, and ministers provide opportunities for direct engagement and dialogue that have been welcomed in both capitals. During a recent visit to Australia, Modi drew a crowd of 20,000 attendees in Sydney (ABC News, 2023). The meetings covered a wide range of policy issues, including closer economic and security collaboration, immigration quotas for Indian overseas students, and frameworks for enhanced cooperation on the delivery of critical minerals from Australia to India (Needham, 2023). Various dialogue mechanisms, such as the Australia-India Foreign Ministers' Framework Dialogue and the Australia-India Joint Working Group on Counterterrorism, contribute to regular consultations and coordination on key bilateral and global issues. These platforms exist in addition to issue-specific working groups within the Quad. Most crucial are arguably the track 1.5 and track 2 diplomacy settings that play an essential role in supporting and complementing official diplomatic channels (Mattoo & Singh, 2022). These platforms and non-governmental dialogues involve academics, think tanks, researchers, and experts from Australia and India.

The institutional diplomatic frameworks supporting the increasingly close diplomatic and strategic ties between Australia and India have developed in a multi-faceted way, reflecting the growing breadth in the relationship. The CSP, high-level visits, dialogue mechanisms, the AIJMC, defense cooperation platforms, track 1.5 and track 2 diplomacy, and economic engagement platforms contribute to the deepening of bilateral relations. These frameworks provide avenues for dialogue, coordination, and cooperation across various sectors, fostering mutual understanding, trust, and facilitation the pursuit of shared interests. The institutionalized engagement between Australia and India reflects Canberra’s and New Delhi’s commitment to building an increasingly encompassing strategic partnership in the face of shared challenges.

Economic ties

The facilitation of growing cooperation in the diplomatic sphere has been partially driven by and has come to reinforce a growing trade relationship. Since 1995, bilateral trade between Australia and India has grown by an annualized rate of 10.9%, with India now being Australia’s fourth-largest export market (Observatory of Economic Complexity, 2023). The expansion of trade came at the back of liberalizing market reforms in India starting in 1991 that majorly reduced average tariffs, simplified tariff, and quota regimes, and removed multiple import restrictions, thus increasing India’s openness to foreign direct investment (FDI) (Singh, 2017). The CSP signed in 2020 provided an additional framework for deepening economic ties that sought to promote trade and investment and encourage cooperation in sectors such as energy, infrastructure, and agriculture (Jha & Sharma, 2023). The two countries have sought to further formalize a Comprehensive Economic Cooperation Agreement (CECA), the negotiations for which were first launched in 2011. CECA negotiations proved difficult and have remained so, especially due to India’s reluctance to enhance the access of Australian firms to the Indian agricultural sector (Parliament of Australia, 2022). In 2022, the Australia-India ECTA came into force. The ECTA aims for a gradual removal scheme on tariffs of Australian exports to India - by 2026, 90% of all Australian goods exports to India under CECA are aimed to be tariff free (Australian Department of Foreign Affairs and Trade, n.d.). By then, both governments aim to have removed all tariffs on Indian exports to Australia. The signing of ECTA was accompanied by an announcement that negotiations surrounding CECA would continue. The expansion in bilateral trade since the 1990s, boosted by the agreement infrastructure surrounding trade, can be observed in Figure 1 and Figure 2. It is notable that although Australian exports to India continue to account for the bulk in bilateral trade, Indian exports to Australia have grown sharply over time.

The CSP, ECTA, and a potential CECA play on the relative complementarities of the Australian and Indian economies. Australia’s rich base of natural resources, including uranium, provides resource access for a fast-growing Indian economy that remains relatively scarce on key natural resources. The make-up of Australia’s export basket to India (constituted primarily by coal, gold, and ore) reflects the importance of resource exports and especially the role coal exports play in sustaining the energy relationship between both countries (Observatory of Economic Complexity, 2023). India’s chief strength, on the other hand, lies in its service industry. While India’s primary exports to Australia are made up of packaged medicaments and diamonds, its growing service sector, increasingly business-friendly environments, and expanding consumer market provides key business opportunities for Australian firms, leading to a growing influx of Australian portfolio investment in India (see Figure 3). On top of the shared concerns regarding China, the natural economic complementarities and the shared desire to diversify trade partners have provided an impetus for strategic alignment and cooperation.

Despite the progress made, tariffs and formal and non-formal trade barriers remain a challenge. These issues include India’s aim to limit the market exposure of its agricultural produce, differences in IPR regulations, and bureaucratic hurdles and complex administrative procedures that reduce the effectiveness of liberalizing policy rollouts. Going forward, the ECTA and a potential CECA signing should address tariff-related complications. There is also room for further growth in the service sector. Barriers to the movement of skilled professionals, such as visa restrictions and a lack of mutual recognition of qualifications, pose challenges for the services sector's expansion that a March 2023 agreement is designed to address (Chandra, 2023). Additionally, improving infrastructure and connectivity between Australia and India is crucial for boosting trade and investment. Enhancing air and sea connectivity, as well as logistics and transport links, would facilitate smoother trade flows and reduce costs. Bilateral investments generally possess significant room for scaling up, for instance by encouraging Australian investments in sectors such as manufacturing, renewable energy, and infrastructure development. This will require addressing regulatory barriers and providing a favorable investment climate, for instance by addressing bureaucratic hurdles on the Indian side and resolving complicated frameworks regarding land acquisition. Lastly, cultural differences and a lack of market awareness pose challenges for businesses seeking to expand trade and investment. Enhancing cultural understanding, providing market intelligence, and promoting business-to-business engagement would facilitate enhanced economic cooperation.

The economic ties between Australia and India have progressed significantly, driven by increased trade, investment, and cooperation in sectors such as commodities, education, and services. The CSP provided an initial framework for expanding economic engagement that has now been supplemented by the ECTA. Challenges nevertheless remain regarding issues such as sector limitations, infrastructure connectivity, bilateral investment, and cultural differences leading to diverging investment conduct. Overcoming these challenges through policy reforms, market awareness, and strengthened cooperation on both a public and private sector level will help to further boost economic engagement and buttress the strategic relationship with in-depth economic interactions.

Maritime security cooperation

Australia and India have also significantly deepened their security relationship, both within the framework provided by the Quad and on bilateral level. While the security and defense relationship encompass a variety of segments, as will be discussed below, it is worth considering the framework for maritime security cooperation in its own right due to the emphasis that has been put on enhancing naval interoperability and information sharing mechanisms. As indicated previously, the Quad has an immediate maritime dimension that is concerned with China’s growing naval presence in both the Indian and Pacific Oceans. Naval power is subsequently a key dimension of the coordination between Quad countries on matters of regional security.

Indeed, strengthening naval interoperability and prowess has been a key policy focus of security cooperation within the Quad. The Malabar Exercise, initially held by India and the United States, has now come to incorporate Australia and Japan, and seeks to boost the interoperability of the naval forces of the four members in regard to MDA capacities, anti-piracy operations, and the coordination and implementation of HADR missions (Rajagopalan, 2021). So far, the Quad has sought to frame exercises as part of a broader regional security architecture that is geared toward addressing a range of threats, including non-traditional security challenges such as piracy, illegal fishing operations, and the response to humanitarian disasters and climate change (Malhotra, 2023). This is part of a broader discourse that has aimed at portraying the Quad as a provider of public goods, for instance by providing vaccine distribution networks during the COVID-19 pandemic, rather than a China-focused, multi-domain containment effort (Rahman, 2023). These portrayals have done little to reassure China, which continues to perceive the Quad as a military and economic effort to contain Chinese influence in the wider region (Raja Mohan, 2022). With Chinese efforts to expand its strategic footprint throughout the Indo-Pacific, maritime security has emerged as a focal point for security cooperation in the Quad.

This multilateral framework is boosted by the bilateral maritime security partnership between Canberra and New Delhi. In 2015, the naval forces of both countries launched the AUSINDEX naval exercise, which has involved a series of operations, including surface, sub-surface, and air operations (Naval Technology, 2021). As with the Malabar Exercise, AUSINDEX is aimed at boosting interoperability and operational familiarity in a variety of traditional and non-traditional threat scenarios (Saha & Singh, 2022). AUSINDEX and the growing number of communication platforms on security and defense have also led to an increase in the coordination between maritime security officials. Additionally, regular high-level visits and exchanges between naval officials have facilitated dialogue and increased cooperation in areas such as information sharing protocols, capacity-building mechanisms, joint training programs, and joint surveillance activities (Indian Ministry of Defense, 2022; Saha & Singh, 2022). The two countries collaborate on initiatives such as the White Shipping Agreement, which facilitates the exchange of information on commercial shipping movements and enhances situational awareness in the Indian Ocean (Saha et al., 2022). This cooperation contributes to a shared operational picture of potentially hostile maritime activities and aids in countering maritime threats such as piracy, smuggling, and illegal fishing. Regular port visits by naval vessels and logistics support arrangements, most notably the Mutual Logistics Support Agreement (MLSA), have further deepened the bilateral maritime security cooperation (Miglani & Packham, 2020). Port visits under MLSA facilitate professional interactions, cultural exchanges, and knowledge sharing between members of the naval forces. Further, the MLSA specifically strengthens operational coordination and provides mutual support for activities such as HADR missions, replenishment, and maintenance (Pant & Oak, 2019). Increased cooperation has subsequently emphasized mutual capacity-building and interoperability in the response to non-traditional security challenges. Crucially, this bilateral level is connected to but separate from the framework of the Quad, in turn boosting interoperability within the Quad.

More general coordination on information sharing procedures and intelligence cooperation have formed a crucial component of the bilateral relationship and the framework provided by the Quad. The Quad’s Indo-Pacific Partnership for MDA serves as a platform for sharing MDA-related information while aiding in identifying areas of shared interest and coordinating responses to maritime security challenges (Heiduk & Wirth, 2023). This mechanism enables real-time information exchange between partners and external actors, facilitates joint patrols, and strengthens cooperation in countering illicit activities, piracy, and smuggling. Further, the MDA partnership can function as a framework for monitoring the (sub)surface activities of the PLAN surrounding crucial SLOCs, including in the Indian Ocean.

Expanding the scope and depth of maritime security frameworks, both on a Quad-level and a bilateral basis, has functioned as a key pillar in the security component of the emerging Australia-India partnership. Through naval exercises, the development of information protocols, enhanced intelligence cooperation, and joint HADR efforts, Canberra and New Delhi have strengthened their coordination on MDA capacities, boosted their interoperability, and contributed to a growing integration of intelligence capabilities. This has been mostly driven by the Quad but augmented on a bilateral level, reflecting the degree to which both countries view one another as increasingly crucial security partners. As maritime security concerns continue to evolve, this cooperation will play a crucial role in maintaining safeguarding the freedom of navigation and ensuring a secure maritime environment.

Wider security and defense industry cooperation

The maritime security cooperation frameworks discussed above are placed in a wider effort to strengthen the overall bilateral security relationship, including via a focus on promoting collaboration on defense technology and the facilitation of technology transfers. The signing of the Framework for Security Cooperation (FSC) by Abbott and Modi in 2014 paved the way for increased dialogue and collaboration in defense technology development and the defense industry as a whole, including via frameworks for joint defense research and development (Brewster, 2015). Following the signing of the FSC, Canberra and New Delhi have collaborated to boost the shared ability to address issues pertaining to cyber security and critical technologies, including AI, quantum computing, and robotics (Minister for Foreign Affairs, 2020). This reflects a perception surrounding shared security challenges that go beyond the immediate questions raised by China’s military build-up.

Defense cooperation is situated in a deepening and broadening institutional framework. The bilateral defense relationship is supported by various institutional mechanisms, including the Australia-India Defense Ministers' Dialogue, the Australia-India Defense Policy Talks, and the Australia-India Defense Ministers' Framework Dialogue. These platforms provide the larger diplomatic framework for discussions on defense policy, defense technology cooperation, joint military exercises, information sharing, and capacity building efforts. The institutional framework in defense cooperation strengthens defense ties and enhances interoperability in the context of AUSINDEX and the Malabar exercises with Japan and the United States.

Australia and India have made notable advancements in defense technology cooperation, the transfer of defense technology, and the joint research and development of advanced military equipment. In India, wider defense cooperation with emerging partners is viewed as key to promote industrial indigenization as part of Modi’s ‘Made in India’ campaign, which has declared a more modern Indian defense industry a key policy priority (Karthikeyan, 2022). As part of this, the Australia-India Strategic Research Fund (AISRF) supports collaborative research and development projects in various areas with potential defense technology application, including remote sensor technologies, quantum mechanics, and critical materials processing (Australian Government Business, 2023). The AISRF enables scientists and researchers from both countries to collaborate on cutting-edge technologies, leading to mutual development protocols and knowledge sharing procedures. Further, the Australia-India Defense Industry Joint Working Group facilitates engagement between defense industry representatives, encourages technology transfers, and supports joint ventures and collaboration in defense manufacturing between Australian and Indian defense contractors (Das, 2023).

Both countries have also promoted academic and institutional collaboration between defense research organizations and educational institutions. The Australia-India Institute (AII), for instance, operated by the University of Melbourne, is co-funded by the Australian federal government and the state government of Victoria and promotes research by Australian and Indian scholars and analysts on a range of shared economic, environmental, and security issues (Australia-India Institute, n.d.). This collaboration encourages joint research projects, academic exchanges, and the sharing of best practices in defense research and development, providing a foundational framework for future defense innovation, technological advancements, and strategic exchanges among non-governmental actors.

Australia has also moved toward sharing its advanced defense technologies with India. The MLSA signed in 2020 allows for reciprocal access to defense logistics facilities, including technology transfer and maintenance support (Miglani & Packham, 2020). The MLSA paves the way for greater cooperation in defense technology, training, and joint operations. As part of this, India has expressed interest in acquiring Australian-origin military equipment, including the Bushmaster and Hawkei light vehicles, as well as Australian radar technologies and undersea equipment (Mehta & George, 2022). Australian government agencies and private defense contracts have emerged as a node of India’s broader defense diplomacy that has become aimed at finding alternative suppliers to diversify away from Soviet and Russian legacy equipment, a push that has been intensified following the Russian attack on Ukraine (The Economist Intelligence Unit, 2022). To promote knowledge sharing and contribute to the building of personal relationships between military personnel, Australia and India have also fostered defense personnel exchanges to promote knowledge sharing and build personal relationships between military staff (Outlook India, 2022). Growing defense industry ties and personnel exchanges allow for the facilitation of shared experiences, training, and professional development opportunities, leading to a better understanding of each other's defense practices and operational doctrines.

While maritime security cooperation has undoubtedly been the primary focus of security collaboration between Australia and India, this focus is situated in a broader push for closer bilateral defense and security cooperation. As is the case with India’s respective security and defense relations with Japan and the United States, New Delhi’s past foreign policy posture has meant that many frameworks that are already in place between Australia, Japan, and the US are still in the process of being developed. Yet, Australia and India have made significant progress in a relatively short period of time. The bipartisan support India currently enjoys in Australian politics suggests that further agreements and cooperative frameworks will likely be introduced in the coming years.

Conclusion

The bilateral relationship between Australia and India in the 21st century has been characterized by an increasing convergence in cultural, economic, diplomatic, and strategic terms. There is a distinct people-to-people element in the relationship, reflected both in Modi’s relationship with various Australian PMs over the years and the growing connection between Australia and India that has emerged as a result of Indian immigration to Australia. On a governmental level, it is the shared threat perception regarding China that has driven India’s tacit reconsideration of its partnership strategies and Australia’s attempt to diversify its security relationships without undermining its strategic ties with the US. The Quad embodies both Australia’s push for security multilateralization and its simultaneous emphasis on the key security role of Washington in wider East Asia.

Australia-India ties have come a very long way in a relatively short span of time. The significant expansion in bilateral trade, a series of security arrangements, both within the Quad and outside of it, and the strong bipartisan support for a greater Indian role in the Indo-Pacific should inspire confidence that the Australia-India relationship is here to stay and will likely grow stronger with time. The signing of a CECA would be another key step in this process. Some issues, for instance regarding non-tariff trade barriers, remain but are likely to, at least partially, be addressed in the years to come.

Playing on both the strategic convergence, a (mostly) shared vision of regional order, and the complementarities between the national economies, the ties between Australia and India are likely to emerge as one of the most crucial connections between major economies in the Indo-Pacific in the years to come.

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