On 8th August 2024 the AUKUS agreement was formally signed and released bringing the three countries - US, UK and Australia into a closer alliance regarding the transfer of submarine technology for nuclear-powered submarines. The US Department of Defence has identified the core aspects of the AUKUS agreement. First, it will be critical for the promotion of deeper and more sustained information and technology sharing mechanism. Second, its aim is to deeply integrate the security and defence industries of the three countries, focusing robustly on issues of interoperability, cyber and artificial intelligence capabilities and quantum technology – areas that are emerging as critical components of defence and security issues, providing these three states an added edge to their positions within the Indo-Pacific region.

Following this, last week former Australian Foreign Minister Gareth Evans, during a lecture to the Academy of Social Sciences in Australia Conference, stated categorically that AUKUS was “terrible for Australian national interest” and that Australia was probably “stuck with it”. Since the AUKUS deal went through, this is probably the second time that a senior and well respected member of the Australian establishment has openly given such a harsh critique of the AUKUS deal. Earlier, former Australian Prime Minister Paul Keating also indicated that the AUKUS deal was more likely to reduce Australian sovereignty with limited choices to make in the long running US-China rivalry in the region.

More recently, Keating has also stated that it would push Australia into being the 51st state of the US, leaving little doubt about the deep domestic divides that have emerged from the AUKUS deal. For both the US and Australia, the impact of the deal resonates both domestic challenges and foreign policy overlaps. Considering the US efforts to retain its position in a largely transitioning Indo-Pacific region, Australia’s choice as its core ally, may be a limiting one. This commentary look at three core issues: the impact of domestic politics on the AUKUS agreement; the focus on France-Australia relations following the AUKUS deal; and the shifts in Sino-Australian relations and its implications on Australian security interests.

First, the domestic debate within Australia has been heating up since the AUKUS deal was inked earlier this month with the distinct divide emerging between the Labour and Liberal party approaches. That the deal took shape under the government of Prime Minister Scott Morrison, leading a Liberal and National coalition, indicates a long-standing foreign policy convergence with everything American. Morrison’s haste to finalise the deal neither looked at the implications on Australia’s strategic sovereignty nor did it account for the domestic pressures that would emerge.

While the successive Labour government that came to power headed by Prime Minister Anthony Albanese could not really back out given the bipartisan clause, it did not clearly address two questions. First, how would the divide within the Labour party respond to the bipartisan clause? And second, regardless of assurances, how does that same clause apply across the Republicans and Democrats in the United States? As the US heads into its electoral year, the specter of a Trump victory defies all logic both domestically and on foreign policy matters. Therefore, the caution from the voices of former Labour party members such as Keating and Evans, indicates the deepening domestic concerns within Australia.

Second, the evolution of AUKUS was initiated as a trilateral dialogue between, the UK, US and Australia in September 2021 to ensure a stable and peaceful Indo-Pacific. The 2021 agreement rests on two pillars. The first initiative is the delivery of nuclear-powered submarines to Australian Royal Navy, replacing the country’s Collins class submarines that were acquired in the 1990s. Prior to the AUKUS announcement, Australia had agreed to purchase Attack class submarines from France. However, there are some reports that suggest the loss of confidence with the French leadership leading to Australia’s volte face and purchase of SSN Virginia class. The SSN AUKUS will systematically replace Astute class submarines in the UK and Collins class in Australia. The announcement abruptly ended the decision to move ahead with the French deal, leaving France red-faced. French Foreign Affairs Minister Jean Yves Le Drian stated that the move was a `stab in the back’, leading to a deterioration in the bilateral ties between Australia and France. This decision was especially difficult given the move towards enhancing interoperability through the La Perouse naval exercises, which brought together France and the four Quad members signaling the expanded French role in the Indian ocean, leading to a period of strained relations. Interestingly, Gareth Evans also reiterated that if the AUKUS were to fail, then the option of exploring a plan B could be a move back to the French deal, which is likely to be difficult given the trust deficit between the two countries following the earlier Australian pullout.  

Third, there is a direct impact of the AUKUS deal on the manner in which Sino-Australian relations are evolving. While domestically, for many, the AUKUS deal’s exorbitant price spurs concern of uncertainty, the greater worry relates to the deterioration in Sino-Australian ties. After surpassing Japan in 2007, China became Australia’s largest trading partner, and later from 2009 till the Covid 19 controversy, it was Australia’s primary export market. Almost 30% of Australia's exports and 23% of its imports respectively go to and come from China. While trade relations were high, there have also been major areas of discord such as the controversy surrounding allegations of Chinese interference and banning of the Huawei network from accessing Australian markets. The government had concerns regarding China’s wolf warrior diplomacy and responded accordingly by establishing restrictions on Australian exports to China. Moreover, the AUKUS deal clearly shows an intentional shift in Australia’s defence projections. This is well emphasized in both the Defence White Paper (DWP) 2016 and the Defence Strategic Update (DSU) 2020, where the emphasis is made on Australia’s deteriorating strategic environment and the need for upgrading capabilities. What was formerly known as the Defence of Australia Doctrine, is today reshaping itself as a national defence policy with the ability to project long range capabilities, pushing the country to a dangerous precipice vis-à-vis the regional security balance with China.

Finally, in order to enhance cooperation with the USA and UK, Australia has put both its security and sovereignty at risk, as stated by former French Foreign Affairs Minister Jean Yves Le Drian. The risk of escalation between the USA and China drags Australia into a conflict not driven by its national interests in the Indo-Pacific.

Ms. Leela Boudjema is a research scholar at the Asian-Pacific Studies at Sciences Po, Paris and Professor Shankari Sundararaman is Professor of Southeast Asian Studies, School of International Studies, Jawaharlal Nehru University, New Delhi.