Uranium-enriched alliance: Canberra and Delhi open new chapter in bilateral relations

Burying their past differences, Australia and India opened a new chapter in bilateral ties when during Australian Prime Minister Tony Abbott’s visit to India the two nations signed the long-awaited agreement on civil nuclear cooperation that entitles India to buy uranium from Australia after years of negotiation. It was Abbott’s predecessor, Julia Gillard, who had paved the way in 2012 for a uranium safeguards agreement that has finally allowed Australia to export uranium to India. The safeguards pact is viewed as critical by those who have opposed the changing Australian policy of nuclear trade with a country like India that has not signed the Non-Proliferation Treaty (NPT). By underlying strict requirements on the safe use of nuclear fuel and specifying regulations in consonance with the global nuclear regime, Canberra is keen to signal its continued adherence to international nuclear standards even as it reaches out to New Delhi to give a boost to its mining industry. Though the safeguards pact took almost two years to finalise, the change of policy by Canberra has been a remarkable development and needs to be recognised as such. 

Australia has the world’s largest deposits of uranium, and major Australian mining companies are looking to expand production as the global demand for nuclear power grows over the next decade. India’s civilian nuclear industry is expanding, as the number of operating plants is expected to increase from 20 to more than 60 over the next decade. Gillard was successful in persuading her Labour Party in 2011 to overturn the party policy of opposing uranium sales to a nation that was not a signatory to the NPT, despite significant opposition. The Labour government’s decision to reverse the Australian policy of allowing the sale of uranium to India as enunciated by its predecessor had been a big blow to Australia-India ties. It was Kevin Rudd, the former Australian prime minister, who had imposed the ban, on the grounds that India was not a signatory to the NPT.

Washington had to pull out all the stops in convincing the Julia Gillard government that, given the strategic importance of India, Canberra needed to change its policy on uranium sales. And Gillard could point to the US-India civil nuclear pact that has brought India into the global nuclear mainstream.

Australia has the world’s largest deposits of uranium, so it always made economic sense for it to sell more to an energy-hungry India. Moreover, it is difficult for Canberra to justify a ban on uranium exports to India, a fellow democracy and a country with impeccable nonproliferation credentials, while continuing to send uranium to China, which has been the most important factor in the weakening of the nonproliferation regime in view of its relationship with Pakistan. Australia has 22 bilateral nuclear cooperation pacts with countries, including the US, China, Taiwan and South Korea.

Even as other nuclear-supplier nations have been lining up to sign civil nuclear pacts with India, Australia found itself marginalised. After the Nuclear Suppliers Group, of which Australia is a member, decided to carve out an exception for nuclear materials exports to India in 2008 by granting it a special waiver, there was no logical reason for Australia to continue with its policy of a ban on uranium sales to India.

Moreover, the geostrategic environment in the Indo-Pacific has undergone a rapid transformation in recent years, with the rapid rise of China. Washington has been working to transform the US-Australian partnership from “an Asia-Pacific alliance to an Indo-Pacific alliance.” Australia’s ties with China have also been difficult in recent years and building bridges with India underlines the evolving strategic reality in the region. The two states have a shared interest in managing the Indo-Pacific commons, including the very important sea lanes of communication. Closer maritime cooperation between New Delhi and Canberra is crucial in managing the growing turbulence in the Indian Ocean region. In a sign of growing defence ties between the two sides, AK Antony became the first Indian defence minister to visit Australia in 2013.

Bilateral trade between Australia and India is growing and is projected to reach $40 billion by 2016 as negotiations on the Comprehensive Economic Cooperation Agreement continue. India is now the fourth largest market for Australian exports. As the Indian economy grows, Australia will continue to be a major supplier of minerals and fuel. Despite recent tensions regarding attacks on students of Indian origin, Australia has continued to grow in importance as a destination for higher studies. The Indian community is Australia’s fastest-growing immigrant community.

It was in 2009 that the two sides decided to elevate their ties to a “strategic partnership.” But as is true of all such ‘strategic’ partnerships, nothing substantive has come out of it. Indian bureaucracy has mastered the art of scuttling momentum in any relationship, and India-Australia is no exception.

With Tony Abbott’s visit, Australia has underscored its commitment to its ties with India and signalled its seriousness about a robust partnership. It is time now for New Delhi to reciprocate. The last trip to Australia by an Indian Prime Minister was in 1986, 26 years ago. There is more to the India-Australia relationship than “cricket, Commonwealth and a common language.” And New Delhi should not be shy of taking advantage of this growing convergence.

The author teaches at King's College, London