China shadow bringing India, Australia closer

India-Australia relations have gained momentum after Australian Prime Minister Anthony Albanese’s visit to India. The two sides had wide-ranging talks covering defence, clean energy, education, critical minerals, supply chains, culture, as well as trade and business. Among the pacts signed were those envisaging cooperation in sports, innovation and audio-visual co-production. They also arrived at the terms of reference for a solar task force. Albanese announced that Indian degrees would be recognised in Australia. This brings cheer to Indian students. The two sides also discussed matters of concern; Prime Minister Narendra Modi raised the recent attacks by suspected Khalistani militants on Hindu temples in Australia. Strengthening economic cooperation was high on the agenda. In December last year, the two countries signed the Economic Cooperation and Trade Agreement, the first free trade deal that India has signed with a developed country in a decade. However, a much larger Comprehensive Economic Cooperation Agreement has been stuck in talks for over a decade. Indian and Australian officials reaffirmed their commitment to finalising CECA by the end of the year. They have set a $100 billion bilateral trade target. India and Australia are Comprehensive Strategic Partners as well as partners in Quad. Security cooperation is growing. Albanese visited INS Vikrant, India’s first homemade aircraft carrier, signalling the importance New Delhi accords its defence ties with Australia.

India-Australia relations have not always been warm. The two countries were on opposite sides during the Cold War. India’s nuclear tests drew a strong response from Australia. Yet, commonalities have drawn them to each other. In addition to the bond they share as members of the Commonwealth, Indians and Australians share a passion for curry and cricket. To this, we can now add another ‘C’ – China. India and Australia are apprehensive over a rising and increasingly belligerent China and its implications for their economies and their security interests. Although neither side mentioned China publicly, Beijing was clearly the elephant in the room.

Both the Indian and Australian economies are dependent on China; a third of Australia’s exports go to China. However, Australian businesses are risk averse and find India a ‘difficult’ country to operate in. India needs to change this perception. Meanwhile, India and Australia are working on building supply chains to ease dependence on China. During Albanese’s visit, they identified five target projects in critical minerals—two lithium and three cobalt—to develop supply chains. These will help India’s transition to clean energy and also ease the dependence of the two countries on China, which currently dominates the world in the mining and processing of critical minerals. Spectacle was on display during Albanese’s visit. India must focus on substance now.