Indo Australia Relations

India-Australia Relations

Overview

Australia’s relationship with India has undergone considerable evolution in recent years, developing along a positive track since a difficult point in 2009. Existing economic, security and people-to-people ties will provide an important basis on which Australia can build its relationship with this important Indo-Pacific partner.

India-Australia trade relations

India is Australia’s tenth largest two-way trading partner, with a total volume of AUD$11.9 billion in 2013. India is Australia’s fifth largest export market, with coal, gold, copper ore and concentrates and agricultural products among Australia’s major exports. These figures have fallen considerably in recent years, registering a 22% decline in two-way trade in the year up to 2013. There are, however, strong prospects for the trade and investment relationship to pick up again, with the likely revival of the Indian economy and growing Indian investment in Australia. 

India-Australia Security Cooperation

Australia and India have a growing number of shared security concerns in the Indo-Pacific region. In light of this, relations between Australia and India were upgraded to the level of a ‘strategic partnership’ in 2009. Australia and India issued a Joint Declaration on Security Cooperation with the aim of enhancing relations in this area.  This policy initiative closely followed proposals by the Lowy Institute, set out in the paperProblems to Partnership: A Plan for Australia-India Strategic Ties, which remains a blueprint for the strategic relationship. 

The opportunities for Australia-India security cooperation are particularly strong in the maritime domain. Following successful humanitarian assistance and disaster relief cooperation in response to the 2004 Indian Ocean tsunami, Australia and India briefly took part in joint naval exercises through the Quadrilateral Security Dialogue in 2007 before the grouping was discontinued following Chinese discomfort and political second thoughts. However, following the visit to Australia of the Defence Minister of India in 2013 , it was announced that Australia and India would hold joint naval exercises in 2015 with the intention of strengthening their strategic partnership. In addition, there is significant potential for enhanced cooperation through multilateral organisations such as the Indian Ocean Rim Association, and the Indian Ocean Naval Symposium, both of which Australia will chair in 2014. 

India-Australia people-to-people links

Indian-born Australians are now the fourth largest migrant community in Australia and in 2011-2012 represented the primary source of Australia’s migration program. The 2011 census revealed that the number of Australians born in India more than doubled since 2006, and Punjabi has become Australia's fastest growing language. This will provide Australia with unique opportunities to strengthen its economic ties with India. 

Beyond recent setbacks: Student attacks and uranium

Australia’s previous reluctance to export uranium to India acted as an impediment to closer India-Australia relations. In 2007, the government of then Prime Minister John Howard stated its intention to sell uranium to India for civilian purposes; however, this policy was immediately overturned following the election of Kevin Rudd’s Labor government in the same year. 

In 2008 the United States concluded a historic Civil Nuclear Agreement with India, which allowed India to purchase nuclear fuel and technology from the US for civilian purposes. In the same year, the Nuclear Suppliers Group granted India a waiver which exempted it from rules governing civilian nuclear trade.  

Following on from these developments, in December 2011 the Australian Labor party, led by then Prime Minister Julia Gillard, reversed its policy to allow the export of uranium to India at its 46th National Conference. Negotiations over a safeguards agreement covering uranium sales began in March 2013 and have continued into 2014.  

One of the most significant setbacks in India-Australia relations was the student crisis of 2009 and 2010. Following a number of assaults upon international students of Indian origin in Victoria and New South Wales in 2009, concerns were raised by the Indian media and government regarding the safety of Indian students in Australia. In response to media-driven perceptions that there was a racial motivation to some of the attacks, large-scale protests over the welfare of these students occurred in Melbourne, Sydney and New Delhi. While diplomatic and policy measures were taken by the Australian federal and relevant state governments to address the issue, the crisis had a profound effect upon both the education industry and broader bilateral relationship, and Indian student enrolments in Australian universities dropped dramatically in the years following the crisis. The crisis did however prompt enhanced diplomatic attention to the bilateral relationship, with 26 high-level Indian visits to Australia and 39 Australian visits to India since 2008. Both governments and wider civil society now acknowledge substantial improvement in the way Australia ensures the welfare of Indian studies in Australia, as noted in the outcomes report of the 2011 and 2012 Australia-India Roundtable, a forum that has helped repair damage to mutual perceptions.