India-Australia Relations | UPSC Notes

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India-Australia Relations | UPSC Notes

India and Australia have a lot in common, which can help them work together and connect in many different ways. This is similar to what India has done with other Western countries. Both are strong, lively, secular and multicultural democracies.

The English language, cricket, and the fact that a lot of Indian students go to Australia to study are all important parts of the relationship between the two countries.

They have had formal ties with each other since before they were independent. It all began in 1941, when the Consulate General of India opened in Sydney as a Trade Office.

After India made changes to its economy, the link between the two countries got stronger and grew to include trade, energy and mining, science and technology, information technology, and defence.

Areas of Cooperation


• There are frequent visits from ministers and the head of government or head of state.

Australian side. In 2009, the level of the partnership was changed to “Strategic Partnership.”

• India and Australia work together in a number of international groups. Australia backs India’s bid to join the UN Security Council if it is made bigger.

• Both India and Australia are members of the G-20, the Commonwealth, the IORA, the ASEAN Regional Forum, the Asia Pacific Partnership on Climate and Clean Development, and the East Asia Summits.

• Australia is an important part of APEC, and it wants India to join the group. In 2008, Australia joined SAARC as an Observer.

• In June 2008, India and Australia signed the Mutual Legal Assistance Treaty (MLAT) and the Extradition Treaty.

• After a series of ministerial trips, PM Narendra Modi went to Australia for the first time in 28 years on the eve of the ‘G20 Leaders’ Summit in November 2014. The relationship is getting better, and Australia says that it is a “foreign policy priority” to get along with India. In 2017, the foreign secretaries and military secretaries of both India and Australia met for the first time for a “2+2 Dialogue.”

• Other MoUs include cooperation in sports, the field of water resources management, technical vocational education and training, the field of tourism, the field of health and medicine, the field of the environment, climate, and wildlife, and the field of civil aviation security.


• As part of its efforts to build a strong economic relationship with India, the Australian government asked for the India Economic Strategy to 2035 to be written. This paper, which came out in 2018, explains how Australia can take advantage of the chances created by India’s economic growth.

• The India-Australia Joint Ministerial Commission (JMC) was set up in 1989 to help government and business leaders talk to each other about a wide range of trade and investment problems.

• Bilateral Trade

India is Australia’s 8th biggest trade partner, with a total trade value of A$26.24 billion in goods and services in FY 2019-20. This is 3% of Australia’s total trade, with exports of A$7.59 billion and imports of A$18.65 billion.

India’s biggest exports to Australia are refined oil, medicines (including those for animals), pearls and gems, jewellery, made-up textile items, women’s clothing, other textile clothing, and base metal products.

India’s biggest imports are coal, trade secrets, copper ores and concentrates, natural gas, non-ferrous waste and scrap, ferrous waste and scrap, and services related to education.

Australia’s biggest service export to India is education, which is worth $6 billion and will make up about 88% of the total in 2020.

• The India-Australia CEO Forum is a way for businesses in both countries to talk directly about ways to improve trade and investment between the two countries. It was set up in 2011 and re-energized in November 2014.

Heads of Indian and Australian businesses from a wide range of fields take part in the Forum.

• Economic Policy Dialogue Between Treasury and NITI Aayog

In 2019, the CEO of NITI Aayog led a two-person team to Australia for the first meeting of its kind.

Also, the Australian Government has started the Australia India Business Exchange (AIBX) programme to encourage more business ties between Australia and India.

AIBX offers a variety of services to help Australian companies start up and grow in India. These services range from industry-specific insights to advice on doing business with India and getting into India’s online retail market.

• Right now, the two countries are talking about a Comprehensive Economic Cooperation Agreement.

(CECA), which will make it easier for Indian companies to sell their goods and services in other countries.

• It should be noted that the relationship should move forward in a good way, since Australia is neither India’s top export market nor a source of imports.

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• There are almost 4.9 million Indian people living in Australia, and they help the country.

In their jobs as teachers, doctors, accountants, engineers, and researchers, they help the business. India sends the third most people to live in Australia.

• The Indian people who live in Australia will help India’s economic and political goals for the foreseeable future.


• The relationship between the two countries is built on the three ‘C’s: cricket, curry, and the Commonwealth.


• In 2012, the Australian government made the choice to send uranium to India.

• When the Prime Minister of Australia went to India in September 2014, the two countries signed a deal to work together on civil nuclear issues.

The agreement went into effect in 2015 and makes it possible for Australia and India to share a lot more energy with each other.

In 2016, the Australian Parliament passed the “Civil Nuclear Transfer to India Bill 2016.” This bill makes sure that Australian uranium mining companies can keep contracts to send Australian uranium to India for civil use without worrying about domestic legal action that could challenge the IAEA’s safeguards in India and Australia’s international non-proliferation obligations.


• The Memorandum on military Cooperation from 2006 and the Joint Declaration on Security Cooperation from 2009 show that Australia and India have a good military relationship.

• Australia took part in the Indian-led Exercise MILAN 2014, which gave it a chance to work together with the Indian Navy and other regional Navies.

• In 2014, the Framework for Security Cooperation was signed by both sides. The Framework sets out a plan of action that includes dialogue at the PM level, expanding defence dialogues and joint exercises, and maybe even joint defence output in addition to a joint partnership to fight terrorism.

• India and Australia agreed in 2015 to hold the first official bilateral naval exercise AUSINDEX every two years, and the next one was held in Australia in 2017.

• The Royal Australian Air Force (RAAF) holds Exercise Pitch Black every two years as a war game.

• Both countries work together in the Special Forces of Army Exercise (AUSTRAHIND).

Agriculture, Science and Technology

• A fund called the Australia-India Strategic study Fund (AISRF) was set up, and a number of study projects that could be done together were chosen.

• The Fund covers agricultural studies, astronomy and astrophysics, environmental sciences, microelectronics, nanotechnology, renewable energy, marine sciences, and earth systems sciences.

• The AISRF has been given more than $100 million by the two countries. There have been set up joint committees on S&T and Biotechnology to run the Fund. The Australian side will help us with our project to clean up the Ganga.

Energy and Mineral Resources

• In 1999, a Joint Working Group on Energy and Minerals was set up to strengthen our ties in the

energy and natural materials. On clean coal technology, both groups will work together.

• Universities in Australia work closely with the Indian School of Mines in Dhanbad to improve it.

• Indian businesses like Adani Enterprises, GVK Power and Infrastructure, and NMDC are looking for ways to find minerals in Australia.

• In 2017, Australia signed a plan to join the International Solar Alliance, which is run by the governments of France and India.

• The Australia-India Energy Dialogue is the most important place to talk about how the two countries can work together on energy and resources.

Four working groups have been set up to help with the Energy Dialogue:

o Smart Grids and Clean Energy

o Power and the Use of Energy

o Mines and coal

o Gas and Oil

• At the recent QUAD summit, both sides agreed to move forward with a low-emissions technology agreement that will focus on hydrogen development and ultra-low-cost solar programmes to help India’s energy transition.

Education, Sports, Art & Culture

• The two countries’ Joint Working Group on Education found several key areas where they could work together.

• As of 2017, there were about 78,000 Indian students in Australia. About half of them were in higher education, and the other half were in professional and educational training.

• Australian and Indian universities are working together more and more on things like the Joint Ph.D. Programme to support research and university tie-ups.

• India’s need to train its young people to take advantage of its growing population gives Australia a chance to become a centre for Indian students. In the Australian government’s India Economic Strategy Report, education is called the “flagship sector” because Australia has a lot of experience in that area.

• A sports relationship between the two countries was recently started in Mumbai.

• Giving Indian cultural items back to India

In the past few years, a number of artefacts have been safely sent back to India.

They are a Bronze Idol of Nataraja from the Art Gallery of South Australia (AGSA) (2019), a stone sculpture of Nagaraja (2020), and two stone sculptures of Dwarpala (2020).

How important Australia is to India

• India’s Act East Policy: India’s relationships with the countries covered by its Act East Policy (AEP) have grown to include security, strategy, politics, counter-terrorism, and military collaboration. Australia is one of the most important strategic players in India’s AEP, which is still centred on ASEAN.

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• Australia is a part of the MTCR, the Australia Group, the Wassenaar Arrangement, and the NSG. India wants to join the NSG, in addition to being a shareholder in the Wassenaar Agreement (of which it is a member) and the Australia Group. This is because India wants to increase the amount of nuclear power it makes and also sell more of it abroad. So, Australia’s backing is important if it wants to join these groups. India needs Australia’s help in international fora, especially the UNSC and APEC.

• Uranium: Now that the civil nuclear cooperation deal is in place, uranium can be sent to India.

• Indian Ocean Region: Since both countries are in the Indian Ocean, the biggest strategic challenges of the future are likely to be maritime. India needs Australia to keep peace and security in the area.

India and Australia’s naval reach can be greatly improved if they work together to build up the island territories in the Bay of Bengal and the eastern Indian Ocean and share facilities and information. This can also help build a stable maritime order in the Bay of Bengal and the eastern Indian Ocean.

India took part in the first official-level discussions under the regional alliance “Quad” in November 2017. This was because India’s views aligned with those of the other countries in the coalition.

• China’s rising assertiveness in the disputed South China Sea: India, Japan, and Australia are all on the “same page” about this. Given how important the South China Sea is for trade and security,

India and Australia have both called for peace and security in the area, as well as respect for freedom of navigation and international law (UNCLOS).

• Energy: India needs Australia as a key partner to meet its growing energy needs and create low-emission technologies for coal, liquefied natural gas, renewable energy, and energy efficiency.

Australia’s long-term and safe LNG supply can help India spread its imports from the Middle East, which are currently very concentrated.

It is a well-known place for Indian companies to go because it has advanced mining technology and rules that are good for business.

• Because Australia is a big country with few people living on it, it can help India meet its immigration goals.

• Australia has a lot of experience with sports infrastructure, which India can use to improve the Khelo India project and set up a National Sports University.

How important India is to Australia


• Australia’s idea of Asia has usually been centred on the Asia-Pacific region, which includes the United States, North and South East Asia, and the South Pacific. Australia has recently started using the word “Indo-Pacific” to show how important a growing India is.

• Australia also sees India getting more involved in East Asian issues, both directly and through the East Asian Summit, which is an organisation.

• The sea will be a big strategic problem in the future. Asia’s continued economic growth depends on the security of the seas and the ability to keep trade lanes open. So the idea of the sea gets India into the strategic picture of the area.

• Because Australia is the only continent that faces both oceans, it has a unique geostrategic situation that puts it in the middle of the Indo-Pacific.

The South China Sea

• Australia’s first foreign policy White Paper in 14 years was released in November 2017. It raised concerns about China’s growing aggressiveness in the Indo-Pacific region and called India, Japan, Indonesia, and South Korea “of first order importance to Australia” to counter Beijing’s goals.

Trade and Investment

• India’s needs for infrastructure, water, and roads are growing, which is good for Australia’s business.

• The Australian government’s India Economic Strategy Report set the goal of making India one of Australia’s top three export markets by 2035 and the third biggest place in Asia for Australians to invest outside of Australia.

• Australia wants India’s economy to grow along with its own, just like it did with China in the past. Australia makes a lot of money off of higher education.

• The proposed Comprehensive Economic Cooperation Agreement (CECA) between India and Australia will make it easier for the two countries to invest in each other and sell goods and services.

• The Indian government’s economic growth programmes give Australia’s energy and resources industry a lot of chances to grow.

Significance for the Region

Maritime Security

• India and Australia are in a good position to work together to solve problems in the area around the Indian Ocean. The most important

The idea of the “Indo-Pacific” is a big reason why India and Australia work together on marine security.

This new geostrategic concept, which combines the Indian Ocean and the Western Pacific Ocean into a single stage, is based on the idea that states in the area should work together more on security issues.

• Both India and Australia are members of the Indian Ocean Naval Symposium (IONS) and the Indian-Ocean Rim Association (IORA), which helps them work together to keep the seas safe.

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Regional Architecture

• The Indo-Pacific faces a wide range of traditional and non-traditional security problems, such as changing power dynamics, territorial issues, nuclear proliferation, terrorism, natural disasters, and pandemics. In this case, the strategic partnership between India and Australia can do a lot to build up security in the area.

Example: When it came to the South China Sea, India and Australia had the same ideas, which made international agreements like UNCLOS stronger.

• India, Japan, and Australia met for the first time ever in a trilateral discussion. This meeting gives an exciting option for future investments.

• Both countries are working together to improve the East Asia Summit (EAS), which is the best place in the area for strategic dialogue and solving political, economic, and strategic problems.

Revival of ‘QUAD’

• The word “quad” refers to the shape made up of Japan, India, the United States, and Australia.

• It will help keep the rules-based order in the Indo-Pacific and ensure that international law, freedom of passage, and overflight are respected. It will also make it easier for people to connect with each other and deal with the challenges of fighting terrorism and keeping maritime security in the Indo-Pacific.

Challenges in Relations

The bond between the two countries is not yet as deep or as big as what they could be. Here are some of the problems:

Different concerns: China

• Australia is worried about how much more China is doing in the Pacific, while India is worried about how much more China is doing in the Indian Ocean.

• It’s possible that Australia doesn’t trust New Delhi because it’s not clear whether it wants to balance or protect. Some of these differences might have to do with how people have used power in the past.

• From this point of view, Australia has been an American friend for a long time, while India is still not sure about alliances.

Lack of Trust

• Even though trilaterals between India, Australia, and the U.S. and between India, Australia, and Japan were a big step forward in strategic and defence cooperation with Australia, the Indian government has decided to go ahead with the 2018 “Malabar” naval exercises without the Australian Navy.

• This move shows that India doesn’t want to upset China, but it also shows that there isn’t enough strategic trust between India and Australia. This is partly because Australia left the Quad in 2007.


• Trade is still very limited. Seventy percent of Australia’s exports to India are only coal and gold, so this needs to be widened.

Australia’s ‘457 Visa’ Issue

• The scheme lets businesses hire foreign workers for skilled jobs where there aren’t enough Australians to do them for up to four years.

Concern: Under the new rules, applicants must have been permanent residents for at least four years, which is three years longer than before, and they must agree to follow “Australian values.”

• The move is a direct hit on India’s long-standing desire for labour mobility, which includes making it easier for temporary foreign workers to work on Australian projects and loosening rules for skilled foreign workers who are not Indian. At the moment, Australia has over 95,000 foreign workers, most of whom are Indian. The future will also be changed by this.

Nuclear Deal at Pivot Point

• Australia has grown its uranium export business in recent years, but many Australians still have a lot of concerns about the sale of uranium.

• The most important rule for allowing uranium mining was that uranium could only be sent to countries that had signed the Nuclear Non-Proliferation Treaty (NPT) for civilian use. India has not yet signed the NPT, so it cannot get uranium for civilian use. In this way, Australia stuck to its policy of not sending uranium to India, even though it had signed a deal to do so.


• They can work together on skill training (to help the Make in India and Skill India programmes), managing water resources, and the energy industry. So, the possibilities for working together are huge and never-ending, and they are more important than the perceived problems and obstacles.

• Australia and India’s relationships are getting stronger in bilateral, trilateral, quadrilateral, and other minilateral and international institutions, and this is not likely to change in the near future.

India and Australia will become even closer in the coming years as their strategic interests in making sure the Indo-Pacific is free of imperial and aggressive policies bring them closer together.

The two are also expected to work together on more strategic and thematic partnerships, such as the Supply Chain Resilience Initiative.

• The strategic relationship between India and Australia has made great strides in the last few years, but its full potential and promise have yet to be reached.

In order for this to become more than a work in progress, both cities will need to give it their full attention and make sure that the right people are in charge.