Oz’s choice—AUKUS and the break with Paris – Observer Research Foundation

Australia’s decision to join the AUKUS was one meant to counter Chinese influence, even if it meant upsetting its ally France
Australia certainly mismanaged the emergence of the AUKUS, but it had few alternatives. Actually, the decision is  another “achievement” of Xi Jinping’s foreign policy. China is clearly the principal factor behind the emergence of the new trilateral military alliance. Though it speaks of a “Community of Common Destiny”, Chinese approach to foreign policy has been to emphasise its hierarchal nature. While it has sought parity in dealings with the US, it expects  middle powers like India, Australia and Japan—entities of a second level—to defer to China’s core interests.
By itself, Australia was emerging as a middle power, working out its minilateral relationships with countries like Japan, India and France in the Indo-Pacific region. It did have a historical relationship with the US through the ANZUS pact and with the UK, Malaysia and Singapore and New Zealand through the Five Power Defence Arrangement (FPDA), but AUKUS binds it to the US and UK alliance more firmly.
Australia was emerging as a middle power, working out its minilateral relationships with countries like Japan, India and France in the Indo-Pacific region.
China has been and remains Australia’s main trading partner for both imports and exports. In 2019, Australia’s exports to China were nearly US $ 103 billion with a partner share of 38.67 per cent. Its imports from China were nearly US  $ 57 billion with a partner share of 25.71 per cent. Note that the partner number two on account of exports, Japan, had a share of just 15  per cent and the US in the case of imports 12 per cent.
Chinese influence in Australia grew by leaps and bounds. China began investing in Australia, sending tourists and students in large numbers. Significant chunks of Australian university budgets became dependent on the Chinese connection and many also agreed to establish  Confucius Institutes to promote Chinese language and culture. In 2018, Victoria, a premier Australian state, even signed an MOU  with China’s National Development and Reform Commission (NDRC) to promote the Belt and Road Initiative. Alarmingly, China-linked businesses also began to donate to Australian political parties.
Faced with Australian disenchantment,  China thought it could successfully coerce Canberra. Instead, it has successfully persuaded the middle power, which was feeling its way about the region and emerging from the shadow of its Anglo-American American connections, to revert back to its default reliance on the US. 
From the 1990s onwards, Australia managed a difficult act of enhancing its relations with China, even while avoiding misunderstandings relating to its US alliance. This was one reason Canberra walked out of the original Quad in 2008.  The growth of the Chinese economy provided opportunities for Australian trade and investment in China.
By 2014, Australia had signed a major free trade agreement with China and a signal of their new ties with Beijing was the address by Xi Jinping to a joint sitting of the Australian Parliament. In 2015, the Aussies shocked the Americans by giving a Chinese company a 99-year lease to the strategic Port of Darwin.
The Global Financial Crisis of 2008 took China several notches up in terms of its clout. But the real shift began with the arrival of Xi Jinping in 2012. Things were going swimmingly well and Canberra’s 2012 White Paper chalked out the Australian vision of their country in the “Asian century”. It spoke of promoting the study of Mandarin, along with Hindi and other Asian languages, as well as stronger relations with key nations like China and India. It also noted that in the previous two decades, “China’s economic influence in Australia has rapidly caught up with that of the US.”
By 2014, Australia had signed a major free trade agreement with China and a signal of their new ties with Beijing was the address by Xi Jinping to a joint sitting of the Australian Parliament. In 2015, the Aussies shocked the Americans by giving a Chinese company a 99-year lease to the strategic Port of Darwin. But the Chinese were on the move. First, in trying to consolidate their hold over the South China Sea by building artificial islands and bases at the expense of their ASEAN neighbours. For Canberra, ASEAN is a buffer between the vastness of Asia where, given the geography, developments can have security implications for Australia.
By now, the Australians had begun to think of moving away from their role as an American surrogate to establishing themselves as an independent middle-power on their own right. As part of this, besides strengthening security ties with  Indonesia, they  reached out beyond the Anglosphere to develop ties with France, Japan and India.
France and Australia share maritime boundaries in both the South Pacific and the south-western Indian Ocean, and, by 2014, the two countries had been cooperating in a range of areas, like surveillance and disaster relief. New Caledonia and French Polynesia give it one of the largest EEZ’s in the world.
When President Macron visited the country in 2018, there was talk of a strategic alliance between France, Australia and India in the Indo-Pacific region.
Australia has experience in manufacturing submarines, but its Collins class, built to a Swedish design, was not a success. The competition for a successor involved France, Germany and Japan and began in the mid 2010s. The  decision to manufacture French submarines in 2016  was not unusual, though the Japanese were unhappy because they thought they had an earlier agreement, though informal, with the Australians.
This led to a greater congruence of the policies of the two middle  powers in the region. When President Macron visited the country in 2018, there was talk of a strategic alliance between France, Australia and India in the Indo-Pacific region. Indeed, in September 2020, the three countries launched a trilateral dialogue at the Foreign Secretaries level and this was elevated to the Ministerial level in May 2021. The French unhappiness is in this background and Australia can blame only itself for not handling the break with Paris better. But the logic behind Australia’s decision is difficult to question.
As the Chinese became more assertive in the western Pacific, they inevitably set off a chain reaction among the regional and extra regional states with interests in the region. Initially, the US adopted a neutral stance on China’s various island disputes with Japan and the ASEAN states, though it began carrying  out a number of Freedom of Navigation Operations (FONOPS) in the South China Sea. But this was the time in 2017 when India also ran into the Chinese in Doklam, an event that has led to rising tensions across the entire LAC.
During the 2017 ASEAN summits, a Quad  grouping, initially set up to deal with the 2004 tsunami, was revived. Though its protagonists denied it had anything to do with China, in fact, it was a calibrated response to the Chinese. But the signs of the coming crisis in Canberra-Beijing relations were evident when Huawei was banned from the Australian 5G network in 2018.
Beijing probably decided that the weakest link in this Quad was Australia given its trade relationship, as well as their growing influence in the country. Nearly 6 per cent Australians had Chinese ancestry with  a vibrant Chinese-language media, which was used by Beijing to attack Australia. There were even reports that the Australian political system was being subverted by Chinese money.
The Chinese were already diplomatically active in the South Pacific and had made inroads into the ASEAN. By 2040,  China’s growing diplomatic clout in the region around Australia would be backed by the PLA Navy with  some six big aircraft carriers, perhaps one each in the South Pacific and the Indian Oceans.
By 2020, Australian resistance to Chinese influence operations began to intensify. Confucius Institutes were shut down and Victoria’s MOU on the BRI was scrapped. China retaliated by tariffs on wine and barley exports, restrictions on coal, timber, red meat and cotton exports, though iron ore, the biggest item of export, was not touched. The cause of Chinese ire was Canberra’s support for a call to have an international inquiry into China’s handling of the origins of the coronavirus.
Rethinking began in Australia about the future of relations with China. Unlike India, which usually responds to crises when they are already upon it, Anglosphere countries think “strategically” and looking ahead, Canberra realised that instead of a partnership envisaged in the 2012 White Paper, relations with China would be hostile in the future.
The Chinese were already diplomatically active in the South Pacific and had made inroads into the ASEAN. By 2040,  China’s growing diplomatic clout in the region around Australia would be backed by the PLA Navy with  some six big aircraft carriers, perhaps one each in the South Pacific and the Indian Oceans. It would also have some 16 nuclear powered attack submarines and a large number of other warships. No combination of middle powers like Japan, India or France would be able to provide an effective balance. The only power that would be able to balance China would be the United States. So Australia, which had revived its older US alliance in the 2010s, now decided to upgrade it.
The route was through the UK, which it approached at the beginning of this year for nuclear submarine technology. This may not have been an easy decision, because it has meant an end to its effort to emerge as a middle power on its own. With the submarine deal, it will remain tied to the US for the foreseeable future, as the project will create an infrastructure which will require close US supervision and, in some cases, control.
Another key issue was the submarine deal. Australia realised that given the American mood, only a move that clearly signalled that Canberra intended to step up its own defence efforts would resonate in Washington. The American calculations had become much more transactional. Japan had realised this early and not only begin increasing its defence budget but also made moves towards accepting the burdens of collective defence. At the same time, as its 2013 National Security Strategy indicated, it began strengthening ties with middle powers like India, South Korea, Australia and the ASEAN grouping.
As a middle power with its own difficulties with China, India, too, has a strategy of band-wagoning with the US in the western Pacific. But unlike Australia, it possesses nuclear weapons, and a large military, more than sufficient to hold its own with China. It already has a fairly advanced nuclear propelled submarine programme. What it does need though are technology fixes that enable its forces, especially the Navy and the Air Force, to maintain an edge over the PLA.
New Delhi probably does not see a formal military  alliance with the US  as either necessary, or feasible, considering India’s other continental perspectives—relating to Iran and Pakistan—are different from that of the US. Indeed, its comfort zone lies along the non-military policy lines now being suggested for the Quad.
The views expressed above belong to the author(s).
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Manoj Joshi is a Distinguished Fellow at the ORF. He has been a journalist specialising on national and international politics and is a commentator and columnist on these issues. As a reporter, he has written extensively on issues relating to Siachen, Pakistan, China, Sri Lanka >>
Set up in 1990, ORF seeks to lead and aid policy thinking towards building a strong and prosperous India in a fair and equitable world. It helps discover and inform India’s choices, and carries Indian voices and ideas to forums shaping global debates. ORF provides non-partisan, independent analyses and inputs on matters of security, strategy, economy, development, energy, resources and global governance to diverse decision-makers (governments, business communities, academia, civil society). ORF’s mandate is to conduct in-depth research, provide inclusive platforms and invest in tomorrow’s thought leaders today.

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