Deputy High Commissioner Rod Hilton's Speech at the Chanakya Chakra forum on Foreign and security policies
“Towards a Secure and Prosperous Indo-Pacific”
4 December 2019, Claridges Hotel, New Delhi
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Thank you very much for the opportunity to address this Chanakya Chakra, and a big thank you to the organisers for pulling together so many eminent speakers on these important topics.
Today I will offer an Australian perspective on some of the strategic dynamics in the Indo-Pacific, outline our approach we are taking to these, and conclude with how we are working with India on this approach.
Strategic Dynamics in Indo-Pacific
While the session’s topic is about ‘challenges’, I like to also think about the opportunities. There is no doubt, uncertainty, change, and disruption characterise the region but there are good prospects for countries like Australia and India, and one is the potential for us to work together.
We are at a point in history where we are transitioning from one international order to another.
Power is on the move. From the North Atlantic, to the Indo-Pacific.
By 2030, the top five economies of the world will be in this region: China, the United States, India, Japan and Indonesia.
The Indo-Pacific will deliver over two thirds of global growth – it will be the engine of the global economy.
And as history shows, with growing economic power comes strategic weight.
Military expenditure in the region is on the rise. Already six of the 10 states with the highest military expenditure in the world are in the Indo-Pacific.
We are also seeing deepening rivalries and sharpening strategic competition over the future of the regional order.
As competition has deepened, respect for international law, rules, norms and institutions has been challenged.
Some powers are also showing a greater willingness to use power coercively.
These trends are playing out in the Indian Ocean, Southeast Asia and the Pacific.
Established institutions, such as ASEAN and its famed unity, are under pressure.
In Australia’s immediate region, the Pacific, external powers are seeking to exploit some of the more fragile developing small island states to further their strategic ambitions.
The nature and evolution of the relative roles and relationship between the US and China will be particularly consequential for the emerging regional order.
China’s phenomenal economic growth, which has seen its share of world GDP increase from 2 per cent in 1980 to 16 per cent in 2018, is already translating into significant power and influence across the region.
China is the largest trading partner for most of the region’s economies – including Australia – and a significant investor. It has the largest navy and air force of any state in Asia. And the largest coast guard in the world. Its aid investments to the region are considerable.
At the same time, the US remains the region’s dominant military power. And it continues to wield significant soft power, as well as a strong economic presence right across the region. It leads the world in technology and innovation and is the hub of the global financial system.
It is easy to conclude that the future of the Indo-Pacific rests in how the US-China dynamic plays out, and it is correct to say that the relationship is the most important in the region and is currently strained.
But the US – China relationship, as important as it is, will not be the only determinant. The future regional order will be considerably impacted by other, powerful, players in the region.
India in particular will grow in strategic weight. As the world’s largest democracy and a growing large economy, India has shown unequivocally development and democracy can coexist. India’s voice will be particularly consequential in regional order building.
As will other emerging Indo-Pacific powers such as Indonesia and Vietnam.
Australia accepts that the rules of the region will naturally change as the geo-political power balances changes. And it is vital that countries like India, Indonesia and Vietnam have more of a say and a greater stake in institutions and norm-setting.
Australia’s Indo-Pacific approach
So given this period of rapid and complex change, what is Australia’s approach to the region?
Australia’s foremost foreign and security policy goal is fostering an open, inclusive and prosperous Indo-Pacific.
Our approach to the Indo-Pacific is based on key principles:
- A commitment to open markets with trade relationships based on rules, not coercion
- An approach which protects sovereignty and builds resilience
- Respect for international law and the peaceful resolution of disputes, without the threat or use of coercive power
- A commitment to supporting strong and resilient regional architecture
In short, Australia seeks an Indo-Pacific region of stable, prosperous and sovereign states, resistant to coercion, but open to engagement on the basis of shared interests.
We are committed to an ambitious, proactive agenda to shape such a region and want to work with all regional partners in this endeavour.
- Promoting rules and norms to guide peaceful cooperation
- Encouraging regional economic integration on the basis of open markets, strong rules and cooperation
- Building resilience and leading collaboration on issues such as cyber security, counter terrorism, infrastructure development and maritime security
- Working to support the strongest possible US economic and security engagement in the region
- Working more closely than ever before with key partners like India, Japan, Indonesia, Vietnam and the Republic of Korea
- Supporting a South Pacific that is secure strategically, stable economically and sovereign politically
- Deepening ties with Southeast Asian counties
- Strengthening engagement with ASEAN and the East Asia Summit, including by prompting practical cooperation to support ASEAN’s Outlook on the Indo-Pacific – we see ASEAN at the centre of the Indo-Pacific
- Using the Quad as a key forum for engagement on regional challenges, complementing the central role of ASEAN and ASEAN-led architecture; and
- Pursuing a constructive relationship with China, whereby we can maintain our substantial trade and wider ties, while managing differences
Australia and India in the Indo-Pacific
I would now like to turn to how Australia views our relationship with India as part of our Indo-Pacific approach.
India is a natural partner for Australia. Its growing and strategic heft is being felt beyond the Indian Ocean, creating new opportunities for our cooperation based on shared values and outlook.
For the first time in Australia’s history, our 2017 Foreign Policy White Paper identified India as in the ‘front rank’ of Australia’ international partnerships. On par with the US, Japan, Indonesia and China.
Our shared outlook and interests in the Indo-Pacific are now grounded by strong people-to-people links. On that front some quick facts:
- One in 50 Australians today (2%) were born in India;
- Currently there are over 109,000 Indian students in Australia; and
- Over 360,000 tourists visited Australia from India last year – our fastest growing group of foreign visitors to Australia.
This level of personal engagement is helping form a more accurate and contemporary understanding of each other and creating a powerful constituency for broad, deep and enduring bilateral ties.
We also have an ambitious vision for our economic relationship. Our India Economic Strategy has put forward a goal to see India become a top three trading partner for Australia by 2035, and India has commissioned an Australian Economic strategy to be released soon.
Pleasingly our trade and investment relationship is currently experiencing double digit growth, and we continue to look for further opportunities to take this even further.
Australia also strongly supports India’s ongoing economic integration into the region. We see India as having a role to play in shaping the regional trading order—prompting the benefit of free and open trade and improving economic governance in the region and beyond.
The convergence in our strategic outlooks has also underpinned a deepening of our defence and security ties.
The third iteration of our bilateral naval exercise, AUSINDEX, held this year (April 2-16), represented the largest-ever Australian defence deployment to India.
The exercise builds on a fourfold increase in our defence engagement — from 11 defence exercises, meetings and activities in 2014 to 38 in 2018.
As well as being Australia’s largest defence deployment to India, the exercise was the most complex ever carried out between our defence forces.
For the first time, our navies undertook anti-submarine warfare exercises. And Indian and Australian maritime patrol P-8 aircraft flew coordinated missions over the Bay of Bengal.
In summary, our relationship is in very good shape and on an upward trajectory.
Next steps for the Australia-India partnership
As the Australia-India relationship continues to grow we are looking to further build our cooperation across the Indo- Pacific in a range of areas, and I would briefly touch on four here today.
1. An open, inclusive and rules-based maritime order
The first area is our joint efforts to shape an open, inclusive and rules-based maritime order in the Indo-Pacific. Australia and India both have large maritime zones in the Indian Ocean and significant naval capabilities. Both countries are strong supporters of UN Convention on the Law of the Sea (UNCLOS). We are working together to strengthen the rules-based order in regional forums such as IORA, the ASEAN Regional Forum and the East Asia Summit.
Australia was one of the first countries to come out in support of India’s Indo-Pacific Oceans Initiative which Prime Minister Modi announced at the East Asia Summit. We look forward to working with India as it develops this initiative in consultation with other countries in the region.
Our bilateral defence relationship can also help shape the regional order, especially as we move towards greater interoperability and alignment of our defence diplomacy.
- Cyber and critical technologies
The second area is our cooperation on cyber and critical technologies. Our countries have a shared view that emerging and critical technologies will shape the security and prosperity of our citizens. As we both examine the coming challenges and opportunities from disruptive technologies we should work together. We want to see a global technology market place that is open and resilient. And we want to ensure our democratic values and citizen-centred approach to technology standards and ethics remains core to next generation technological advances.
Harnessing the potential but also protecting our citizens when it comes to artificial Intelligence, machine learning, 5G and 6G and quantum computing are priorities for both Australia and India. As is collaborating in these fields so that the norms, rules and standards that shape the global technology eco-system reflect our shared values.
- Responding to the threat of terrorism
A third area of cooperation is responding to the threat of terrorism. We have a growing annual counter-terrorism dialogue and are developing practical cooperation on responding to the threat across the Indo-Pacific. We both support an effective Financial Action Taskforce which addresses the financing of terrorism. Recently, I was also able to attend the Quad Counterterrorism table top exercise in New Delhi, a great example of practical cooperation focused on this important challenge.
- Promoting connectivity across the Indo-Pacific
The fourth area is our increasing support for economic governance and infrastructure across the Indo-Pacific. We see a role for both of us to promote the principles of free and open trade, grow prosperity and support trade liberalisation and shape the region’s economic rules and institutions.
Our countries are both committed, together with other partners, to sustainable, principles-based infrastructure investment that is transparent, promotes open competition that upholds robust standards, avoids unsustainable debt burdens, targets the needs of nations of the region and unlocks the potential of private sector investment in the region.
Australia for its part has announced new initiatives across the Pacific, Southeast Asia and South Asia. We will use our Southeast Asia Economic Governance and Infrastructure Initiative to unlock the next wave of Southeast Asia’s economic growth.
Australia’s Minister for Foreign Affairs launched in January the new South Asia Regional Connectivity initiative, known as SARIC. SARIC will focus on the transport and energy sectors and we will seek to support connectivity between South and Southeast Asia, a priority of both India and ASEAN members.
And among a major package of initiatives, known as our Pacific Step Up, Australia has announced a A$2 billion financing facility for the Pacific.
We have likewise seen India increase its contribution across the region and Minister Jaishankar has made his intention clear to strengthen India’s role in this field even further.
In conclusion, it is an exciting time right across the Indo-Pacific as well as for the Australia-India bilateral relationship.
If countries like Australia and India can find ways to take forward the potential of our relationship we can shape the regional order, respond to uncertainty and bring about shared prosperity and security.
We are very pleased that our Prime Minister, Scott Morrison will soon be in New Delhi, to give the key note speech at the upcoming Raisina Dialogue. No doubt he will be addressing many of the issues we are discussing today, and I promise will give you a much better articulation of Australia’s approach than I have. I am also sure we may hear about some new announcements but I am definitely not going to steal his thunder on that!
Thank you again for the opportunity to address you today, and I look forward to the rest of the discussions.