INDIA - AUSTRALIA RELATIONS – INTERNATIONAL
News: The
India-Australia relationship
What's in the news?
● After
a visit to the cricket stadium in Ahmedabad with Prime Minister Narendra Modi
Thursday, Australian Prime Minister Anthony Albanese tweeted about the fierce
but friendly sporting rivalry between the two nations.
● "At
the heart of this contest is genuine respect, reflecting the affection and
friendship between our peoples...On the field, Australia and India are
competing to be the best in the world. Off the field, we are co-operating to build a better world,"
Albanese, the first leader of his country to make a bilateral visit to India
since Malcolm Turnbull in 2017. posted.
● The
first in-person India-Australia Annual
Summit was held recently.
India - Australia Relations:
Historical perspective:
● The
India-Australia bilateral relationship has been underpinned by the shared values of pluralistic,
Westminster-style democracies, Commonwealth traditions, expanding economic
engagement, and increasing high-level interaction.
● Several
common traits, including strong, vibrant, secular, and multicultural
democracies, a free press, an independent judicial system, and English
language, serve as the foundation for closer co-operation and multifaceted
interaction between the two countries.
Evolution:
● The
end of the Cold War and beginning of India’s economic reforms in 1991 provided
the impetus for the development of closer ties between the two nations.
● The
ever-increasing numbers of Indian
students travelling to Australia for higher education, and the growing tourism
and sporting links, have played a significant role in strengthening
bilateral relations.
● With
the passage of time, ties evolved in the direction of a strategic relationship,
alongside the existing economic engagement.
● In
recent years, the relationship has charted a new trajectory of transformational
growth.
● With
greater convergence of views on issues such as international terrorism, and a
shared commitment to a rules-based order in the Indo-Pacific region, the two
democracies have taken their cooperation to plurilateral formats, including the
Quad (with the United States and Japan).
Strategic ties:
● In
September 2014, Australia’s Prime Minister Tony Abbott visited India, and in
November that year, Modi became the first Indian Prime Minister to make an
official visit to Australia after Rajiv Gandhi in 1986. He also became the
first Indian PM to address a joint sitting of the Parliament of Australia.
● At
the India-Australia Leader's Virtual
Summit in June 2020, Modi and Prime Minister Scott Morrison elevated the
bilateral relationship from the Strategic Partnership concluded in 2009 to a
Comprehensive Strategic Partnership (CSP).
● At
the 2nd India-Australia Virtual Summit
in March 2022, several key announcements were made, including on a Letter of
Intent on Migration and Mobility Partnership Arrangement to foster the exchange
of skills, and a Letter of Arrangement for Educational Qualifications
Recognition to facilitate the mobility of students and professionals.
China factor:
● Ties
between Australia and China were strained after Canberra in 2018 banned Chinese
telecom firm Huawei from the 5G
network. Later, it called for an inquiry into the origins of Covid-19, and
slammed China’s human rights record in Xinjiang and Hong Kong. China responded
by imposing trade barriers on Australian
exports, and by cutting off all ministerial contact.
● India
has been facing an aggressive Chinese military along the border. New Delhi and
Canberra have been assessing the Chinese challenge since 2013.
Economic cooperation:
● The
Economic Cooperation Trade Agreement
(ECTA) - the first free trade agreement signed by India with a developed
country in a decade entered into force in December 2022, and has resulted in an
immediate reduction of duty to zero on 96% of Indian exports to Australia in
value (that is 98% of the tariff lines) and zero duty on 85% of Australia’s
exports (in value) to India.
● Bilateral
trade was US$ 27.5 billion in 2021. With ECTA, there is potential for it to
reach around US$ 50 billion in five years.
People-to-people ties:
● India
is one of the top sources of skilled
immigrants to Australia. As per the 2021 Census, around 9.76 lakh people in
Australia reported their ancestry as Indian origin, making them the second
largest group of overseas-born residents in Australia.
● To
celebrate India@75, the Australian government illuminated more than 40
buildings across the country, and Prime Minister Albanese issued a personal
video message.
Education:
● The
Mechanism for Mutual Recognition of Educational
Qualifications (MREQ) was signed on March 2 this year.
● This
will facilitate mobility of students between India and Australia. Deakin
University and University of Wollongong are planning to open campuses in India.
● More
than 1 lakh Indian students are pursuing higher education degrees in Australian
universities, making Indian students the second largest cohort of foreign
students in Australia.
Defence cooperation:
● The
2+2 Ministerial Dialogue was held in
September 2021, and the Deputy Prime Minister and Defence Minister of Australia
visited in June 2022.
● The
Mutual Logistics Support Agreement
(MLSA) was concluded during the Virtual Summit in June 2020, and the two
militaries held several joint exercises in 2022.
● Australia
will host military operations with India, Japan, and the US in the “Malabar” exercises off the coast of
Perth in August, and has invited India to join the Talisman Sabre exercises
later this year.
Energy security:
● Australia
is a natural partner for India in the energy sector.
● Four
products such as coal, non-monetary gold, copper ores & concentrates, and
petroleum accounted for over 80 percent of India’s imports from Australia,
thereby having immense potential on India's energy security.
Clean energy:
● The
countries signed a Letter of Intent on New and Renewable Energy in February
2022 which provides for cooperation towards bringing down the cost of renewable
energy technologies, especially ultra low-cost solar and clean hydrogen.
● During
the Virtual Summit in March 2022, India announced matching funds of AUD 10
million for Pacific Island Countries under Infrastructure
for Resilient Island States (IRIS) and of AUD 10 million for Pacific Island
Countries under International Solar Alliance (ISA).
Rising QUAD:
● Both
India and Australia are members of QUAD (India, US, Australia, Japan).
● Australia-India
Indo-Pacific Oceans Initiative Partnership (AIIPOIP)
helps shape maritime cooperation in the Indo-Pacific to support an open,
inclusive, resilient, prosperous and rules-based maritime order.
Issues in India-Australia relations:
Economic relations:
● The
trade between the two countries has been at a modest $31 billion, largely composed of resources like coal and
other minerals.
● The
problems faced by the Adani Group to begin work on a coal mining project in
Queensland did not go down too well with investors from India.
Visa issues:
● India’s
desire for visa reforms in Australia, which would permit more Indian workers to
seek employment in Australia, remains unmet.
● India wants greater free
movement and relaxed visa norms for its IT
professionals, on which Australia is reluctant.
Nuclear power issue:
● Building
consensus on non-nuclear proliferation
and disarmament has been a major hurdle given India’s status as a nuclear
power.
Bilateral defence cooperation:
● Although
security has received a lot of significance in the relationship, in practice
Australia-India defence cooperation remains relatively undeveloped.
● There
are a considerable number of defence and security dialogues between the two
countries, but none has been translated into more substantive cooperation.
Attacks on Indians:
● Increasing Racist attacks
on Indians in Australia has been a major issue.
● The
relationship was further strained over the attacks on Indian students studying
in Melbourne, and the resulting media coverage caused serious damage to
Australia’s standing in India.
Chinese influence:
● China is Australia's
largest trading partner in terms of both imports
and exports which leads to increased chinese influence in Australia's foreign
policy.
WAY FORWARD:
Investment Protection:
● India’s overly defensive
stand on investment protection under
international law is a consequence of several international claims under BITs.
● India
should come out of its shell and accept investment protection as part of its
broader economic commitments under international law. This will enable India to
realize the full potential of these CECAs.
Improving Competitiveness:
● While
the Government of India has successfully negotiated an excellent trade deal for
businesses, it is important to realise that accessing the Australian market
wouldn’t be a cakewalk given the fact that Australia has currently 16 FTAs
under operation.
● We
would still have to work on improving our competitiveness, as in most trade
sectors, India would be competing with the likes of China, ASEAN, Chile, Japan,
Korea and New Zealand, which have already-functional FTAs with Australia.
APEC Partnership:
● Time
is also opportune for India’s
Asia-Pacific Economic Cooperation (APEC) membership, the goal of a free and
open Indo-Pacific is incomplete without the presence of the world's fastest
growing major economy in APEC.
● Also,
with the deepening of Australia India bilateral ties, Australia can explore
initiating a support lobby within APEC for India’s membership.