From the days of former Australian prime minister Robert Menzies, Australia has desired strong ties with India. “We must learn to think together and to act together,” Menzies declared in 1950 during a state visit to the then newly independent nation.
Australia’s economic exposure – and potential vulnerability – to China requires Australia to diversify its economic risks.
Fast-forward to 2014 and Indian Prime Minister Narendra Modi’s visit to Australia after a gap of 28 years. In a speech to the Joint Sitting of Parliament in Canberra, Modi asserted that Australia was no longer at “the periphery of India’s vision but at the centre of its thoughts.” It was a sentiment echoed in 2017 when then Australian prime minister Malcolm Turnbull visited India, even Australia’s current prime minister has offered a view, with Scott Morrison likening Australia-India relations to cooking a chicken curry, cautioning “if you try and do this without a plan, it ends pretty badly.”
To me, Australia–India relations can be best described as “loaded in intent, limited in actions.” All these years of intermittent pledges of common destiny are unfulfilled by lopsided international priorities. As others have said, it’s long past time to get past a joint connection via the Commonwealth, cricket obsessions, and a love of curry.
The potential of this relationship is often overshadowed by a severe lack of enthusiasm and even episodes of outright prejudice.
Advantage Australia
It is under-appreciated and unnoticed that Perth and Chennai are closer to each other than Sydney is to Seoul, Beijing, or Tokyo (South Korea, China, and Japan are top trading partners of Australia). The two-way trade in goods and services between Australia and India stood at $19.4 billion in 2015–2016, which is far below its potential. The much-anticipated Comprehensive Economic Cooperation Agreement, or CECA, an Australia–India free trade deal, has not been signed and is presently shelved.
Over the past 25 years, India’s explosive economic growth has vaulted it into the ranks of the world’s emerging major powers. On the threshold of major reforms, India is poised to become the third-largest economy of the world by 2030. The three D’s – democracy, demographics, and demand – powered by digitisation and decentralisation, are unlocking new market potential.
The release of the India Economic Strategy 2035 last year by the Australian government is an attempt to capture these opportunities. The strategy has a set a target for India to become one of Australia’s top three export markets, to make India the third-largest destination in Asia for Australian outward investment, and to bring India into the inner circle of Australia’s strategic partnerships. The strategy is divided into 10 sectors and 10 states where Australian business should be focusing. The Indian diaspora in Australia is expected to play a big role in building these economic linkages; highlighting the importance of the largely prosperous 700,000-strong Indian-origin population in Australia.
But can Canberra take advantage and New Delhi reciprocate? What do both countries need to do differently to go beyond rhetoric and find substance? The need to “catch up” has to be complemented with precise action.
When strategy meets action
First, both countries need to be mindful of their contemporary realities, needs, compulsions, and limitations. Australia’s economic exposure – and potential vulnerability – to China requires Australia to diversify its economic risks. One-third of all Australian exports globally are China-bound. Meanwhile, India is undergoing an aspirational shift with rising demand and desire for better goods and services. Australia can understand this aspiration, and match India’s priorities with Australia’s strengths in varied sectors, going beyond energy, resources, and China.
Second, there are also geostrategic compulsions and realities to address. India and Australia are situated in the Indo-Pacific where the centre of economic and strategic gravity is shifting. Both countries are wary of China’s assault on maritime security and freedom of navigation in the region. These common concerns have strengthened the need for greater maritime cooperation between the two nations. India also needs Australia’s collaboration in regional institutions on issues of terrorism, climate change, and trade.
Third, the Indian diaspora, as the India Economic Strategy notes, offers the perfect partner. The diaspora seems to be deeply invested emotionally in affairs back home. For all the money they remit to India, they wish to be valued and counted. Embracing the contributions of the Indian diaspora and giving them prominence in bilateral relations by strengthening diaspora organisations will help attract talent in sectors that will drive Australia's growth. Ensuring this talent is mentored and supported can result in a local Indian diaspora that improves Australia’s standing and influence in India by presenting Australia as an innovative, diverse, safe, and prosperous society. The diaspora can act, as has been described, as a “living bridge” between the two nations.
Fourth, the missing ingredient in this mix of economics and geopolitics is deeper cultural understanding. Colonial histories and subsequent postcolonial identities marred by outbursts of cultural superiority of Australia have played a significant role in fracturing Australia–India ties. More people-to-people interactions and education partnerships must be enhanced to address this challenge.
Fifth, for India, Australia has never been in the first rank of India’s international priorities, the focus has been on its neighbourhood and after that on the major powers. That must change. Australia’s hybrid character offers India a singular combination of qualities as a strategic and economic collaborator – Western yet increasingly Asian, with massive natural resources yet a developed economy. Australia combines proximity as an Indian Ocean neighbour with deep enmeshment with other parts of the globe. Both countries have much more to gain from forging closer links.
Momentum is important to relationships. With elections due in both countries, let’s hope that the quality of the relationship will catch up with its ambition.
