AUKUS and Australia's Strategic Dilemma: Deterrence, Diplomacy, and Regional Stability in the Indo-Pacific
AUKUS
Abstract
Australia's engagement in the Indo-Pacific has taken a significant turn with the formation of AUKUS, a trilateral security partnership with the US and the UK. The agreement, which involves Australia acquiring nuclear-powered submarines, represents a strategic response to growing regional instability, particularly amid China’s assertiveness. This paper explores the motivations behind AUKUS, its strategic and economic implications, and the varied reactions from regional partners. While AUKUS enhances Australia's defense posture and deepens military cooperation with allies, concerns persist regarding its potential to trigger an arms race. The document also examines the interplay between AUKUS and the QUAD, as well as the possibility of expanding the partnership to include additional Indo-Pacific nations. While AUKUS is designed to bolster regional stability, its success depends on careful diplomacy and sustained multilateral engagement.
The Indian Ocean as a Geopolitical Battlefield
Strategic Importance and Trade Routes
The Indian Ocean which spans over West Asia, Africa, South Asia, Southeast Asia, and Australia is the third largest water body in the world. It covers 17.5% of the world’s land area. This region is home to various important trade routes that connect Asia, Africa, and Europe.
Chokepoints, Energy Security and Global Trade
Important chokepoints like the Malacca strait and the Hormuz strait are present in this region.[1] They are responsible for more than 50% of the world's oil shipment. Any conflict or maritime blockade in these areas could significantly impact global trade, energy supply chains, and economic interconnectedness, underscoring the Indian Ocean's role as a pivotal geopolitical battlefield in the 21st century.
Climate and Navigability
Due to its strategic geographical location, this region has been a recent hotspot amongst the world powers. It has emerged as the most contested region, as each country wants to protect their Sea Lines Of Communication (SLOC) for their energy security. This region is called the Heat engine of the globe due to its unique warm surface temperature.[2] This warm ocean remains navigable throughout the year, facilitating smooth trade and navigation.[3]
China’s Expanding Influence in the Indian Ocean
China’s Strategic Maritime Shift
The Indian Ocean's strategic significance extends beyond its maritime trade routes. The region hosts critical mineral resources, including offshore oil and gas reserves, rare earth elements, and significant fishing zones. Approximately 40% of the world's offshore oil production occurs in this region, making it a crucial energy corridor. Therefore, due to its significance, several key players like India, China, The U.S., Japan, Australia, and France exert their influence through numerous ways.
China’s Interest in the Region
While there are many key players in this region, in recent years China has emerged as a prominent player in the Indian Ocean Region. China has extended its influence throughout the region including showcasing a profound interest in Africa. Therefore, this article will specifically analyse the rising influence of China in the Indian Ocean Region and will also analyse the response of one of another major player India, which is often called as the ‘net security provider’ of the region.
China’s Naval Modernization and Doctrinal Shift
China released its ‘Near Coast Defence’ doctrine in the 1980s, which primarily aimed to protect the country’s coastal areas. In 2004, China shifted its strategy to ‘Near Seas Control’ doctrine, which aimed to control the areas till the first island Chain (a series of islands stretching from Japan, Taiwan, to the Philippines). While this interest is due to China’s increasing integration with the global economy and its overseas interest, The 2010 defense white paper highlights the importance of having an overseas logistics facility to support out of area activities, and subsequently the 2013 defense white paper highlights the need for establishing a blue-water navy. The 2013 paper also brought out certain missions such as protecting and providing support to Chinese interests abroad, evacuating Chinese citizens, and investing more in domestic R&D to modernize the PLAN and PLAAF.
Chinese interests in the "far seas" were first elevated to the level of national security in 2015 when the Chinese government released a white paper on national defense that explicitly stated Chinese aspirations to establish a blue-water navy and introduced a two-tiered maritime strategy of "offshore waters defense and open seas protection."[4] China’s interest in this region is mainly to protect its Sea Lines Of Communication for a secure flow of energy and protect its foreign trade, as China is an example for export-led growth model, so it needs the Indian Ocean to transport its goods across the markets.
The Indian Ocean is important for China due to its warm surface temperature. The Chinese ports such as Ying Kou, Jinzhou, Hulu Dao, Dandong, Qinhuangdao, Tangshan, Weifang, and Dinging on the northern border freeze during winter and halt all commercial activities for more than half a year.[5] Therefore, China needs warm water ports for its energy security and trade. Energy security is the paramount concern for China to increase its presence in this region.
China’s Energy Security and the Malacca Dilemma
Approximately forty per cent of China’s oil imports pass through the Strait of Hormuz and around eighty-two per cent of oil pass through the Malacca Strait. This ‘Strait’ indicates China’s ‘Malacca Dilemma.’ This term was first coined by Hu Jintao during his speech in 2003.[6] The Strait of Malacca is a natural strategic chokepoint since Singapore, a significant U.S. ally that regularly takes part in U.S. naval exercises, is situated at the mouth of the strait's eastern opening. A foreign country might simply block the Malacca Strait during a war, denying China access to vital oil supplies.[7]
The Belt and Road Initiative (BRI) and Its Impact on the Indian Ocean
Meanwhile, in 2013 Chinese President Xi Jinping launched the Belt and Road Initiative (BRI). This initiative aimed to connect East Asia and Europe through physical infrastructures. Under this initiative, various infrastructural projects were launched such as building ports, bridges, railway lines, pipelines, and airports. Apart from building these infrastructural projects, China has invested in the Special Economic Zones (SEZ) and has created employment opportunities.[8] This project has expanded to Africa, Latin America, Central Asia, and South Asia. The BRI is composed of two projects, the overland silk road economic belt and the Maritime Silk Road (MSR). Critics highlight the principal issues associated with the BRI such as the debt trap diplomacy of China, environmental impacts, dual-use strategy, and a lack of transparency. The BRI is seen as a policy of China to expand its presence and exert its control in the invested region.
India’s Response to China’s Expansion
India’s Position in the Indian Ocean Region
India, having a vast coastline in the Indian Ocean Region, is one of the major powers in this region. India is also called as the ‘net security provider’ in this region. While it acts as the security provider by taking up responsibilities in the region, it also faces threats from the expansion of China in the Indian Ocean Region (IOR).
Strategic Port Investments
The Chinese investment in South Asia is considered as China’s strategy of establishing a Dual-Use infrastructure, which is these establishments are more than just for commercial purposes. For example, the investment in Gwadar port that was constructed for commercial purposes is also a deep-water port that can hold submarines and aircraft carriers.
Therefore, this has been a national security concern for India, as China can use Gwadar for intelligence and Surveillance base.
China’s Presence in Sri Lanka and India’s Concerns
In Sri Lanka, the Hambantota Port, which was leased to China for 99 years after the country struggled with debt repayments, follows a similar pattern. Hambantota's strategic location in the Indian Ocean Region, making it a significant hub in maritime trade and surveillance, along with Sri Lanka's proximity to India makes it a national security issue for India to be concerned about.
There have been incidents where Chinese vessels have been docked at Sri Lanka’s port. In 2022, the Yuan Wang 5 was given permission to dock, where they have stated it as a ‘research vessel’.[9] Due to the closer proximity and tensions with China, many analysts have viewed this as a Chinese attempt to spy over India. Similar events have occurred in 2023 as well. Later, due to the rising concerns from the Indian government and other powers who are concerned about the Chinese presence in Sri Lanka, the Sri Lankan government has declared a moratorium on foreign research ships entering its water for a year.[10]
These are all part of China’s broader ‘String of Pearls’ strategy to encircle India. The ‘String of Pearls’ is a term first coined by Booz Allen in 2005 in his report named ‘Energy Futures in Asia’.[11] China has been developing closer diplomatic ties with the littoral regions of the Indian Ocean for years. The 'String of Pearls' aims to strengthen China's economic, political, and diplomatic influence in the Indian Ocean region. Each 'Pearl' in this string represents a realm of power that China must secure in the Indian Ocean region.[12] China has invested in the littoral regions by building ports such as Chittagong port in Bangladesh, Sittwe and Kyaukpyu port in Myanmar, Hambantota in Sri Lanka, and Gwadar in Pakistan. These investments create an ‘encirclement’ with its bases around India and threaten India’s interests.[13]
India’s Strategic Countermeasures
In response to the ‘string of pearls’ strategy, India has used the strategy of ‘Necklace of Diamonds.’ This term was first used by India’s former Foreign Secretary in 2011.[14] This strategy includes enhancing India’s diplomatic relations with key littoral states such as Iran, Oman, Japan, Vietnam, Singapore, Vietnam, Mauritius, Seychelles and other states.[15] Therefore, by investing in key infrastructure projects and ports, India aims to safeguard its energy lines and ensure a free flow of trade. In 2024, India signed a 10-year with Iran to develop the Chabahar port. This deal was signed between the Indian Ports Global Limited (IPGL) and the Port and Maritime Organisation of Iran.[16] By investing in this port, India will be able to access the markets of Central Asia and Afghanistan, by bypassing its rival Pakistan.
China’s Expanding Influence in Africa and the Western Indian Ocean
China’s Military Presence in Africa
China's strategic expansion extends beyond Asia into Africa, following a similar pattern of infrastructure development and port acquisitions. The most prominent example is Djibouti, where China established its first overseas military base in 2017, positioned at a crucial choke point between the Red Sea and the Gulf of Aden.[17]
China’s Naval Expansion and Military Exercises
In 2015, during the discussions on this base, the Djibouti was considered only as a ‘support facility’ for the PLAN to engage in anti-piracy operations and for UN Peacekeeping Missions, it later turned up into a military base. China’s economic footprint in Djibouti was not due to its raw materials, but its strategic location in the Western Indian Ocean, along with its presence in the eastern edge of the African continent. The PLAN frequently takes part in Anti-Piracy and counterterrorism operations in the Western Indian Ocean. In December 2008, the PLAN sent out two guided missile destroyers and a supply ship to take part in international anti-piracy operations off the coast of Somalia in the Gulf of Aden region.[18] This was the first time that the Chinese had conducted an operational mission outside its territory. It positions itself as a responsible leader in this region. The PRC has also established its first multilateral forum in 2000 that is outside its periphery, which is the Forum on China-Africa Cooperation (FOCAC).[19] The PRC also conducts Professional Military Education (PME) to the African military leaders.[20] China’s investments have increased over its years spreading to other regions of Africa. These commercial projects in Africa are a way for PLAN to increase its influence in the Eastern Indian Ocean.
India’s Naval Modernization and Defense Strategy
Project 75 and Project 77
India being an important strategic player engages in diplomatic activities and naval modernization. The main objective of India’s naval modernization is for India to become a regional leader and counter the rise of China in the Indian Ocean Region. Significant investments have been made by the Indian government on the naval modernization such as the ‘Project 77’ and ‘Project 75’.[21] The Project 77 or P77 is about the construction of India's indigenously built new nuclear-powered submarine. Only two nuclear-powered ballistic missile submarines (SSBNs) from India's "Arihant-class" program are in service at the moment. INS Arihant, which was commissioned in 2016, is the first, and INS Arighaat, which was inducted in August 2023, is the second. Because these submarines are capable of carrying nuclear-tipped ballistic missiles, they have improved India's deterrent capabilities.[22]
Project 75 is a 43,000-crore deal to build six diesel electric submarines for the Indian Navy to stay submerged for a longer time.[23] There have been some efforts in creating an integrated theatre command to bolster the deterrence posture of India. The command structure that was released this year, highlights the maritime theatre command that will be established at Coimbatore, Tamil Nadu, which will further increase India’s strategic position in the Indian Ocean Region.
Military Cooperation with Southeast Asia
Along with the naval modernisation process, the Indian Navy has been used as a tool for diplomacy. The Indian Navy has conducted various bilateral and multilateral exercises with the foreign countries. There has been an emergence of minilateral forums such as the QUAD. The QUAD primarily focuses on the Indo-Pacific region consisting of the U.S., India, Australia, and Japan. Other forums such as the Colombo Security Conclave and IORA also address the maritime security challenge of the current times. India has also boosted its defense exports to Southeast Asian countries. In 2022, Philippines signed a $375 million deal with India for the delivery of Brahmos missile, a joint venture missile between India and Russia. The first batch of these missiles were successfully delivered to the Philippines in April 2024.[24] In 2023, India has also gifted the indigenously built naval corvette INS Kirpan to Vietnam. Therefore, exchange of such sensitive technologies demonstrates the trust the partner nations have over India.
Conclusion: The Future of Indo-Pacific Geopolitics
Shifting Currents: The Indo-Pacific in the 21st Century
In conclusion, the metaphor ‘shifting currents’ clearly highlights the dynamic and evolving geopolitical landscape of the Indian Ocean Region. Unquestionably, China's strategic actions in this vital maritime area have changed the status quo, forcing India to reevaluate its responses and strategies. “Whoever controls the Indian Ocean will dominate Asia. This ocean will be the key to the seven seas in the 21st Century. The destiny of the world will be decided on its water.” This quote of Mahan has proved to be true due to the growing geopolitical tensions in the Indian Ocean Region, to control the important Sea Lines of Communication.
Geopolitical Power Struggles and Future Stability
As each state follows a different Indian Ocean Strategy, India also tackles the security issues through various methods which also includes diplomacy, new policies, and naval modernization.
[1] The Importance of the Indian Ocean: Trade, security, and norms - The Lakshman Kadirgamar Institute. (2019, February 1). The Lakshman Kadirgamar Institute. https://lki.lk/publication/the-importance-of-the-indian-ocean-trade-security-and-norms/
[2] Kalim, I., Saud, A., Ikram, S., Butt, H., & Salman, M. (2023). Geo-Political Dimensions of the Indian Ocean Region in the 21st Century: A Critical analysis. Journal of Xi’an Petroleum Institute (Natural Science Edition), 1231–1244. https://www.researchgate.net/publication/372585897
[3] Ibid.
[4] Author, G. (2015, July 1). China’s Military Strategy White Paper 2015: Far Seas Operations and the Indian Ocean Region | Center for International Maritime Security. https://cimsec.org/chinas-military-strategy-white-paper-2015-far-seas-operations-indian-ocean-region/
[5] Kalim, I., Saud, A., Ikram, S., Butt, H., & Salman, M. (2023). Geo-Political Dimensions of the Indian Ocean Region in the 21st Century: A Critical analysis. Journal of Xi’an Petroleum Institute (Natural Science Edition), 1231–1244. https://www.researchgate.net/publication/372585897
[6] Ibid.
[7] Ibid.
[8] McBride, J. (2023, February 3). China’s massive belt and road initiative. Council on Foreign Relations. https://www.cfr.org/backgrounder/chinas-massive-belt-and-road-initiative
[9] Muzaffar, M. (2022, August 16). Yuan Wang 5: Chinese ‘spy ship’ docks at Sri Lanka’s Hambantota port despite India’s security concerns. The Independent. https://www.independent.co.uk/asia/china/chinese-spy-ship-sri-lanka-b2145980.html
[10] Francis, K. (2024, January 5). Sri Lanka declares moratorium on research ships for a year amid Indian concerns over Chinese vessels | AP News. AP News. https://apnews.com/article/sri-lanka-india-china-research-ships-42ddb725105eb32b3b43fee8fff3838c
[11] Kalim, I., Saud, A., Ikram, S., Butt, H., & Salman, M. (2023). Geo-Political Dimensions of the Indian Ocean Region in the 21st Century: A Critical analysis. Journal of Xi’an Petroleum Institute (Natural Science Edition), 1231–1244. https://www.researchgate.net/publication/372585897
[12] Ibid.
[13] Ibid.
[14] Mengal, J., & Mirza, M. N. (2022). STRING OF PEARLS AND NECKLACE OF DIAMONDS: SINO-INDIAN GEO-STRATEGIC COMPETITION IN THE INDIAN OCEAN. Asia Pacific, 40, 21–41.
[15] Ibid.
[16] Haidar, D. P. (2024, May 13). India, Iran sign 10-year contract for Chabahar port operation. The Hindu. https://www.thehindu.com/news/national/india-iran-sign-long-term-bilateral-contract-on-chabahar-port-operation/article68171624.ece
[17] Unbound, G. B. F. A. (2018, April 13). China’s strategy in Djibouti: mixing commercial and military interests. Council on Foreign Relations. https://www.cfr.org/blog/chinas-strategy-djibouti-mixing-commercial-and-military-interests
[18] Ditter, T., Haney, K., Tsai, T.-K., Reid, C., & CNA Corporation. (2024). The military and security dimensions of the PRC’s Africa presence. In CNA Corporation [Report]. https://www.cna.org
[19] Ibid.
[20] Ibid.
[21] Naqvi, S. I. A. (2024, November 28). India’s Naval Modernization Plan: implications for China, Pakistan, and regional stability. Modern Diplomacy. https://moderndiplomacy.eu/2024/11/29/indias-naval-modernization-plan-implications-for-china-pakistan-and-regional-stability/
[22] Ibid.
[23] MoD issues RFP for construction of six P-75(I) submarines for the Indian Navy. (n.d.). https://pib.gov.in/pressreleasepage.aspx?prid=1737191
[24] Peri, D. (2024, April 20). India delivers first batch of BrahMos to Philippines. The Hindu. https://www.thehindu.com/news/national/india-delivers-first-batch-of-brahmos-to-philippines/article68084161.ece