Ruddying relations

A closer strategic India-Australia relationship—the “how”

The Lowy Institute has released an excellent policy brief, authored by Rory Medcalf, coinciding with Australian prime minister Kevin Rudd’s first visit to India. You should read it in full—but the cogent executive summary is worth reproducing on this blog.

What is the problem
Strategic ties between Australia and India keep falling short of expectations, despite strong growth in trade. Controversy over the welfare of Indian students has added to differences over uranium exports to cloud what should be promising links between two countries with many common concerns. The relationship will weather recent turbulence. But without major diplomatic initiatives soon, the prospects for a truly strategic partnership between these Indian Ocean democracies will be set back for years.

What should be done?
The relationship needs to be invigorated through a leaders’ commitment to a strategic partnership, informed by a fresh awareness of how each country can help the other increase its security. This needs to be more than rhetoric.

A bilateral security declaration would add Australia-India relations to a regional web of defence ties involving Japan and South Korea. India should reciprocate Australia’s overtures to engage as a priority maritime partner, including in exercises. The two armies should help each other too, for example in special forces training.

Australia and India should work to expand common ground on nuclear non- proliferation and disarmament, which might help open the way on uranium sales. Both governments need fully to grasp Australia’s vast potential in ensuring India’s energy security.

Regular strategic dialogue should focus on common interests, including relating to China, Pakistan, Afghanistan, terrorism and maritime security. Options should also be explored for new regional arrangements including a three-party forum with Indonesia. [Lowy]

Related Link: Mr Medcalf also has an op-ed in today’s Indian Express. In the February 2008 issue of Pragati he argued that closer India-Australia ties requires political will on both sides.

Uranium reservations

The Rudd government has created a window of opportunity for China to lock in Australia’s uranium supplies

Greg Sheridan writes that Australia’s policy on rejecting uranium sales to India will eventually change, but step by step.

Now, however, Australian policy suffers a serious contradiction. In supporting the deal, Australia is urging all other members of the international community to engage in full nuclear trade with India, including the supply of uranium, without which it will be impossible for India to build nuclear power stations.

Yet official Australian policy is that while it supports the deal and will engage in nuclear technology trade with India, it won’t supply uranium to the world’s biggest democracy because New Delhi is not a signatory to the NNPT.

This contradiction is, of course, madness. And make no mistake: while New Delhi fully understands Canberra’s position, deeply appreciates its support at the IAEA and the NSG and understands that the Rudd Government won’t support the various stages of the deal until they are actually agreed to, eventually a refusal by Australia to sell uranium to India, while selling it to China and Russia, would lead to deep trouble between Canberra and New Delhi.

That’s why eventually the Rudd Government will move away from its ban on uranium to India. Step by step, one stage at a time, in concert with the international community, but the destination of selling uranium to India is surely now inescapable as a result of the sensible decisions we’ve taken up to now. [The Australian]

Having overturned its predecessor’s decision, the Rudd government has only set the clock back by a few years. This gives China the opportunity to lock in Australia’s uranium supplies, and Chinese state-owned firms are doing just that. China’s failed attempt to block the NSG’s waiver to nuclear trade with India should be seen in this context.

Discussing Australia’s domestic debate on regulating Chinese investment into the country’s natural resource sector, Lowy’s Mark Thirlwell argues that while changes to rules on foreign investment are not necessary, “the number of cases where foreign government ownership will represent a challenge to Australia’s national interest will turn out to be very small. But ‘very small’ is not the same as zero.” It is for thinking Australians to consider whether it is their interest to allow the Chinese government to buy into its uranium mines before Indian companies are even allowed to purchase the ore.

Concerning Australia’s uranium sales

The Rudd government would do well to climb out of an unnecessary hole it has dug for Australia

Greg Sheridan has a very insightful piece on the India-US nuclear deal and the stakes for Australia (linkthanks V Anantha Nageswaran). He gets it right when he argues that Australia can’t hope to enjoy a close relationship with India if it maintains a discriminatory policy on uranium sales.

Then the deal must be approved by the Nuclear Suppliers Group. Here’s where Australia comes in. With something like 40 per cent of the world’s known uranium reserves, Australia is a key member of the NSG. So far, the Rudd Government has not said whether it will support the US-India deal at the NSG or oppose it.

It has however hinted that it would support the deal at the NSG, a hint Foreign Minister Stephen Smith repeated yesterday. Certainly Australia could kiss goodbye forever the idea of any decent relationship with India if it opposes the deal at the NSG.

Accepting the deal at the NSG would not commit Australia to supplying uranium to India. However, that will be the next big question…

Opposition foreign affairs spokesman Andrew Robb has effectively homed in on the contradiction between the Rudd Government selling uranium to China – which has a terrible, though not recent, record of nuclear proliferation – while refusing to sell uranium to India, which has never passed on nuclear technology to anyone.

..the Rudd Government will face a deep contradiction between supporting the US-India deal in the NSG, then saying it will not sell uranium to India. It will face an even bigger contradiction between its concern with greenhouse gas emissions and taking action, by refusing uranium to India, that impedes the development of clean energy. [The Australian]