An important obstacle in the way of India-Australia relations has been removed with Australia’s prime minister Julia Gillard indicating willingness to sell uranium to India. Australia is home to 23 per cent of the world’s uranium reserves and is the world’s third largest producer of uranium after Kazakhstan and Canada. It has been reluctant to sell uranium to India so far on the grounds that India is not a signatory to the Nuclear Non-Proliferation Treaty (NPT).

Unlike the conservatives, the ruling Labour Party, especially under former prime minister Kevin Rudd was fiercely opposed to selling uranium to India. Gillard’s shift in position represents a welcome change. However, her shift will have to be endorsed by her party and it remains to be seen whether she will be able to carry the rest of her party with her. She has drawn attention to the immense benefits that will accrue to the Australian economy from selling uranium to India. There are sections within her party as well as the Australian Greens who continue to question India’s nuclear energy programme. Gillard should draw attention to India’s exemplary record as a nuclear power.

India is not in immediate need of Australian uranium. Still the Australian ban on sales was seen in Delhi as a sign of Canberra’s distrust of Indian intentions. The shift in position will go some way in changing that perception in India. With mutual suspicions likely to come down soon, the two countries can focus on economic and maritime security co-operation. In the past, cricket and the Commonwealth brought India and Australia together. But they have more in common than that. They are key players in the emerging Asia-Pacific security architecture.

The shot in the arm to India-Australia relations could result in a flowering of a closer strategic co-operation. While improving ties is to be welcomed, India must tread carefully. It has in the past engaged in joint naval exercises with Australia. In 2007, there was some animated discussion over the formation of a ‘Quadrilateral of Democracies’ including India, Australia, Japan and the US. While the four countries made no mention of China being in their crosshairs, it was seen in China and elsewhere as an anti-China grouping. Not surprisingly, it raised concern and hackles in Beijing. India must avoid going down that road again. Joining hands with countries to ‘contain’ China is not in India’s best interests.