Australia and India in the Indo-Pacific
High Commissioner’s Address to the National Defence College
3 May 2018
(check against delivery)
It gives me great pleasure to join you today.
And a sincere thanks to Commandant Vice-Admiral Srikant, for inviting me to address you all.
This is my fourth visit to the National Defence College in the past year alone.
I accompanied our Prime Minister to the College in April last year, our Minister for Defence Industry in January 2018 and the Governor General in March.
The College is starting to feel like a second home!
We place a high value on our relationship with the NDC, not just because of its reputation and high quality graduates.
We have been sending Australian military staff to study at the College almost every year since 1966.
The relationships forged here have helped build the trust and genuine friendships which underpin our strategic partnership.
You will recall that our Governor-General, General Sir Peter Cosgrove, graduated in 1994. He was so pleased to be able to connect with his batch mates during his recent visit here.
And the Defence Adviser at the Australian High Commission, Captain Simon Bateman who joins us today, graduated from the College just last year.
Australian Foreign Policy and the White Paper
I have been impressed, in my engagements with the College, by the depth and breadth of strategic thinking that you do.
To contribute to that, I want to talk with you today about Australia’s vision for a stable and prosperous Indo-Pacific region. And I want to talk about where Australia sees India in this vision.
In November last year, the Australian Government did something it had not done for over 17 years.
We published our foreign policy.
Foreign policy is usually a fairly nebulous and abstract thing. But now, you can read it. You can access it on a really excellent website (www.fpwhitepaper.gov.au). You can even print it out.
The culmination of an intense and months-long process, the Australian Foreign Policy White Paper is a clear articulation of how Australia sees current global opportunities and challenges. It describes the kind of world we want to see. And it sets out a path to get there.
The Global Context: A Shifting Landscape
The core conclusion of the White Paper is that we are experiencing an unprecedented period of global strategic and economic transition.
In this transition there are both challenges and opportunities.
Multiple, concurrent trends are having a significant impact on relations within societies and between nations.
The most pronounced trend is the shift of global power from West to East. Globalisation and dynamic growth in Asia has seen a dramatic shift of strategic weight to the Indo-Pacific.
Asia’s share of world merchandise trade rose from 23.7 per cent in 1990 to 38 per cent in 2015. By 2030, we predict the top five economies will all be in the Indo-Pacific: China, the United States, India, Japan and Indonesia. In this time:
• China’s GDP is expected to double to over $42 trillion
• India’s GDP will more than double to reach nearly $21 trillion
• Asia will deliver two thirds of global growth.
The same economic success that has presented opportunities, growth and pulled hundreds of millions of people out of poverty, has also raised strategic competition.
The capabilities and projection of hard power by Indo-Pacific states is rapidly increasing. For example:
• Asia is the second largest region in terms of military expenditure at $447 billion in 2017 – this rose from approximately 17 per cent of global expenditure to 27 per cent over the past 10 years.
• Of the top 10 states with the highest military expenditure, six are located in the Indo-Pacific.
• India has been the world’s largest arms importer in recent years.
So power relativities within the Indo-Pacific are shifting. The White Paper concludes that the United States will remain the pre-eminent global power for the foreseeable future.
But, like all great powers, China will increasingly seek to influence the region to meet its own interests.
Other megatrends are also playing out in our region.
Technological advances have delivered economic opportunities and greater productivity while also disrupting the job market and posing challenges to security.
These trends are compounded by demographic changes. Ageing populations in some countries contrast with massive youth bulges in others. Shifts in global migration patterns and urbanisation place pressure on the existing order.
Climate change, transnational crime, terrorism and displaced populations due to violence and state fragility will also bring profound economic and political consequences.
The current post-Cold War order, as we know it, is under immense pressure. It is easy to see how these trends give rise to anxiety and competition.
This anxiety is manifesting in challenges to the post-war order which has served Australia – and India – well for over 70 years.
So we are seeing greater challenges to globalisation and the rise of nationalism. Global governance is becoming more complex, as emerging economies and non-state actors exercise greater influence. International rules designed to maintain peace are being challenged.
The risk we face is that the international order gets hollowed out and is unable to manage the increasing complexity of our environment.
Left unchecked, nationalist, inward-looking policies chip away at our confidence in cooperation and international norms.
It makes it harder for countries to tackle global and regional challenges.
Australia’s Foreign Policy Priorities and Values
In tackling this collection of challenges, the Australian Government has set five clear priorities in the White Paper.
• working to keep our Indo-Pacific region peaceful and prosperous at a time of change
• maximising opportunities for Australian businesses by keeping markets open and trade and investment flowing
• ensuring Australians remain safe, secure and free in the face of threats like terrorism
• promoting a world with rules that support stability and prosperity and that also enable cooperation to tackle the many challenges that states cannot deal with alone; and
• stepping up support for a more resilient Pacific, which is of fundamental importance to Australia.
The foundations of Australia’s foreign policy, and of all these objectives, lie in our values.
Insofar as some of the geostrategic challenges we face today are challenges to our values, then the best way to meet them is to assert our values clearly and effectively.
Our values define our institutions and society. They operate at two levels.
At an individual level, they are defined by our Anzac spirit.
Commandant Vice-Admiral Srikant was gracious enough to attend our Anzac Day service last week – a day borne out of the great and tragic experiences of the Australian and New Zealand Army Corps in the First World War.
Australian soldiers fought side by side with Indian soldiers in Gallipoli, East Africa and on the Western Front.
For those unfamiliar with the tradition, the Anzac spirit captures the qualities we value in times of hardship and adversity. Military historian Charles Bean defined it as “reckless valour in a good cause, for enterprise, resourcefulness, fidelity, comradeship and endurance.”
Values also exist at a national or country level.
As a nation, we Australians do not define our identity by race, religion or common cultural heritage.
Rather, we are defined by our shared values as a nation. Pre-eminent among these are acceptance of the rule of law; political, economic and religious freedom; liberal democracy; and racial and gender equality.
These are values that are deeply held by India too. And by many other countries in the Indo-Pacific.
We do not impose these values on anyone, but we do advocate and advance them internationally. For the idea of the Indo-Pacific we seek is a region aligned with our values.
Australia’s Vision: A Stable and Prosperous Indo-Pacific
Providing security and prosperity to your citizens is the first goal of any government. Security and prosperity are therefore also the twin goals of any foreign policy for any country.
The White Paper goes a step further. It defines the kind of security and prosperity we seek. It is clear about the kind of Indo-Pacific region we want.
And that is a region where adherence to rules delivers lasting peace. Where the rights of all states are respected. And where open markets facilitate the free flow of trade, capital and ideas.
Too often, strategic policy thinkers pay too little attention to the importance of economic policy as a contributor to strategic goals. So let me dwell on this a bit before I go any further.
The case for open trade is worthy of a speech of its own. But, for now, I will underscore a few key points.
The bottom line is that a more integrated world will be more prosperous and more secure than one characterised by protectionism and geo-economic rivalry.
For one, an open world economy drives trade, investment and economic growth for all countries.
It builds resilience and flexibility in national economies by encouraging competition, adaptation and connectivity to international markets.
Second, open trade is the surest way to deliver prosperity to citizens. In the case of Australia, foreign owned companies generate revenue and employ over 700,000 people domestically. One in five Australian jobs are trade-related. And three decades of trade liberalisation has made Australian households better off by around $8,500 annually.
And finally, strong and connected economies are also the best counterweight to tensions emerging from geo-economic rivalry.
Achieving our Goals in the Indo-Pacific
In recent years, Australia and India have increasingly adopted the phrase “Indo-Pacific” to describe the region of our strategic interest.
We can debate semantics and geographic definitions, but for Australia, the Indo-Pacific is more a strategic, rather than a geographic, concept.
It has two consequences for our strategic thinking. First, its unifying feature is maritime security and interests. And second, it brings India firmly into Australia’s strategic frame.
For Australia, achieving the kind of Indo-Pacific region we want rests on several elements:
• Our alliance with the US remains at the core of our strategic and defence planning. So a priority is to broaden and deepen our alliance cooperation with the US.
• Equally, Australia, along with many other countries, also seeks strong and constructive engagement with China. China is a major geopolitical player and Australia’s largest trading partner. We wish to see China play a leading role in a way that strengthens the regional order.
• Work more closely with the region’s major democracies, bilaterally and in small groupings. Aside from the US, this includes Japan, Indonesia, the Republic of Korea and, of course, India.
• Increase our efforts to be a security, economic and development partner for Southeast Asia.
• Stronger defence cooperation and engagement in the region; and
• Working to ensure that regional investment and infrastructure building is inclusive and based on market principles.
India’s Place in Australian Foreign Policy
Where is India located in our foreign policy approach?
While India has always been an important partner for Australia, our strategic alignment is stronger now than it has ever been.
We are two Indo-Pacific democracies. We are both G20 economies. We are both countries with strong maritime interests and capabilities in the Indian Ocean. And we both share common values.
Our diaspora and education links are adding depth and texture to our relationship.
We have a strong defence and security partnership. Defence cooperation is the highest it has been in our two countries’ histories.
Australia is a valuable partner for India in maritime security, counter-terrorism and cyber cooperation.
We bring high-end military capabilities and investments in intelligence, surveillance and reconnaissance.
Our military relationship is deepening.
Last year we concluded the second iteration of our bilateral naval exercise, AUSINDEX.
Our two Armies are now working more closely together with the Special Forces exercise AUSTRAHIND scheduled for later this year.
And Indian Air Force fighter aircraft will be participating in Australia’s largest multilateral air exercise PITCHBLACK in August. This is intended to include the first air-to-air refuelling between Indian Air Force SU30s and an Australian Air tanker.
It is no wonder, therefore, that the White Paper places India at the front rank of Australia’s international partnerships.
Working Bilaterally and in Small Groups
To pursue our shared goals in the Indo-Pacific, we need to work together.
And traditionally, we have relied on multilateral and regional institutions to help us do this – the UN, for instance, the East Asia Summit or even the Indian Ocean Rim Association (IORA).
While these institutions are important, they have their constraints. They may not always be sufficiently flexible or agile to respond to the complexity of challenges we now face in our region.
So we need to expand our toolkit. We need to invest in new forms of collaboration that are agile, quick and flexible. This requires creativity, vision and courage.
Small groups, overlapping groups and minilateralism now provide new platforms to coordinate. They can comprise different countries and inject flexibility to achieve common goals.
More and more, Australia and India are participating in small group meetings. We hold trilaterals together and separately with partners like the United States, Japan, France and Indonesia.
India has its own set of smaller engagements including the BBIN, BIMSTEC, BRICS and trilaterals with Russia and China.
Much attention has been given to the meeting of Senior Officials from Australia, India, the United States and Japan—otherwise known as the Quad—which held its first meeting last November.
The Quad in many ways is no different to other minilaterals. It brings together likeminded countries to share assessments, shape views and navigate strategic challenges from infrastructure to maritime security and counter-terrorism.
It is important to underscore here that there is no silver bullet. No one grouping or tool will deliver the kind of strategic order we wish to see. We need them all.
The complexity, change and uncertainty that characterises our world is not new. However, the pace and scale is unprecedented.
Ten years ago, leading international relations scholar John Ikenberry warned that we must prepare for a more decentralised distribution of power. This required countries to think about the question:
“What sorts of investments in global institutional architecture do [we] want to make now so that the coming power shifts will adversely impact [us] the least?”
This is particularly relevant for the Indo-Pacific.
There is no place for complacency.
If we miss the opportunity to strengthen a rules-based order and embed shared principles, then we leave ourselves open to a future in which anxieties and assertiveness will only intensify.
Without effective mechanisms of cooperation, transnational issues and unilateral actions that cut across the region will prove too difficult to manage.
To retreat from this challenge is not an option.
What we need now is the conscious decision to invest in partnerships and build habits of cooperation so we may shape the kind of future that we want.
Democratic countries in the Indo-Pacific like Australia, India, Japan, the US and Indonesia share an interest in working together to ensure stability and prosperity. Where we share values and a common interest, we need to act.
Australia and India already share a broad and comprehensive partnership. We have the foundation for deeper cooperation.
For Australia, the Foreign Policy White Paper sets out a strategy for how we will pursue engagement and under what terms.
For India, this may require some difficult decisions. To project and protect interests abroad requires firm foundations and a clear vision at home. This takes time and sustained effort.
It also means that in an environment of strategic rivalry and competition, we cannot always balance everyone’s interests.
Standing up for values, rules and international norms can also raise some risks. But, in my view, these are risks worth taking.
I am now into the second half of my posting as High Commissioner. In the short time I have been here, I have seen the Indo Pacific become an increasingly complex environment. At the same time, I have also witnessed countries explore and pursue cooperation with renewed vigour. This is a good thing.
A peaceful, prosperous region requires vision, courage and sustained investment in relationships.
I am hopeful we can rise to the challenge. And I look forward to working closely with my Indian counterparts to do just that.