India: A New Relationship for a New Century

20 June, 2008

Thank you for that welcome and thank you for inviting me to speak to you today.

Professor Alan Robson, Vice Chancellor of the University of Western Australia, Sujatha Singh, Indian High Commissioner to Australia, Sushma Paul, the Indian Honorary Consul in Western Australia, Eric Ripper, Deputy Premier of Western Australia, Professor Kim Beazley, distinguished guests, ladies and gentlemen:

I am very pleased to be at my old University today, in three capacities – a former student, the Member for Perth and Australia’s Foreign Minister.

I am also particularly pleased today to be speaking about the fundamental importance Australia places on its relationship with India.

It’s appropriate I do that in Perth and at UWA. UWA has a distinguished record in Indian studies. Some here will track that back to the establishment in 1993 of the School of Asian Studies. I go much further back, to the seventies, when the late Dr Hugh Owen taught South Asian studies, focusing on Indian history. Hugh had an Australian and an international reputation in this area.

After I graduated in law from UWA, as a young articled clerk and legal practitioner I completed my Arts degree here part time. It was a delight to be lectured and tutored by Hugh, with his particular expertise in the period surrounding India’s independence.

Later when I worked and studied in London, Hugh arranged for me to have access to the India Office Library on Blackfriars Road, a literal treasure trove of manuscripts and documents on India.

As the Member for Perth, my own electorate has well-established connections with India: cricket and hockey.

Firstly, cricket through the WACA and secondly hockey, generally, but also through my friend and predecessor as the Member for Perth, Dr Rica Charlesworth, an Australian Olympic hockey team captain, who is now Technical Advisor and Expert Coach for Indian hockey.

It’s a tragedy India has not qualified for the Beijing Olympics, a regrettable first in 80 years. I’m sure Rica will help ensure the Indian hockey team is at London in 2012.

Let me now make some remarks about the need for Australia to forge with India a new relationship for a new century.

Immediately after I became Foreign Minister in early December last year I had the opportunity to speak to the diplomatic corps in Canberra.It was my first formal speech as Foreign Minister.

I said then that,

“India’s remarkable development only encourages me to bring us closer together. I look forward to working with the Indian Government and the Indian people to add depth and vigour to our relationship”.

And I have repeated that sentiment many times since.

It’s in part because I’m from Western Australia that I’m conscious of India’s dynamism. Here, on the edge of the Indian Ocean, Western Australians naturally look west, to India, and we are as conscious of its great economic prospects as we are of our own. Western Australia exports more to India than any other Australian State. It is also under-appreciated that Perth and Chennai are closer to each other than Sydney is to Seoul, to Shanghai, or to Tokyo.

While many commentators have been focusing on the rise of China, not enough attention has been paid to the rise of India. India’s rising strategic, economic, political and cultural influence means it will be a key player in shaping the world in the 21st Century.

As the world sees the potential of an Asian/Pacific century unfold, Australia sees India at the heart of this historic shift in political and economic influence. And what gives Australia a feeling of optimism is that we can do more rather than just witness this economic transformation.

We are already part of the process. Our future is linked to that of India and our other Asian neighbours. Our economic growth is powered by their growth.

The Investment and Trade Dynamic

Australia and India are being bound ever closer together by a truly remarkable growth in trade.

Last year, the size of the Indian economy exceeded US$1 trillion. For the last several years, it has been growing at 8-9 per cent annually. Some economists predict that, by 2025, India will be the world’s third-largest economy.

Australia has benefited immensely from this growth, and I pay tribute to industry in both our countries who play the vital role of promoting bilateral commercial ties.

Trade with India has grown faster than any of our other top markets over the past five years. In 2004, India overtook the United Kingdom to become our sixth largest market for merchandise exports.

India has become our 10th largest trading partner. In 2007 two-way trade in goods was nearly $11 billion. Over the past five years Australian goods and services exports to India have risen at an annual average of more than 30 per cent.

Our trade has been anchored in minerals resources. Products like gold, coal, copper and diamonds will continue to dominate our exports for a period. But slowly and steadily, services like information and communications technology, education, tourism, finance and construction are becoming much more prominent. India is now the seventh-largest market for Australian services.

Indian and Australian investors are also beginning to seize opportunities in our respective markets. Australian investment in India was worth over $2 billion in 2006, including in manufacturing, telecommunications and minerals processing.

Indian companies are now investing in Australia, building on our skills in information technology, agribusiness and resources.

Gujarat NRE, a significant coal producer, listed on the Australian Stock Exchange last year, and India’s leading software firms such as Tata Consultancy, Satyam and Infosys have a growing market presence in Australia.

Importantly, in the services sector, India faces some economic challenges in areas where Australia is well placed to assist.

Australia offers expertise in agricultural logistics, to help Indian farmers get their produce to market faster. We can offer financial and legal services as well as expertise in infrastructure financing and provision. We can also work together on food products and extractive and clean energy technologies.

Last year Australia and India decided to undertake a joint feasibility study into a bilateral Free Trade Agreement. My colleague Simon Crean and his counterpart, Kamal Nath, agreed last month that our officials would complete the FTA study by the end of this year.

We are determined to now seize upon what we see as an historic opportunity to take our relationship with India to a new economic and strategic level. This momentum has occurred despite, not because of, any concerted Australian governmental effort over the past thirty years or so.

During that time, the business community has certainly pursued its commercial interests. The growth in our commercial ties has outpaced government-to-government contact. While a number of States, including my own of Western Australia, have more recently been very active, governments in Canberra have frankly both under-appreciated and neglected our relationship with India for a long period.

This cannot continue.

Our countries share too much in common. Our economies enjoy too much complementarity for our relationship to require anything less than our full and constant attention.

Since taking office, the Australian Government has sought to increase the level of our official engagement with India. So far this year, we have been fortunate enough to welcome a series of high-profile Indian visitors.

I met personally with Prime Ministerial Envoy, Shyam Saran, in January when we enjoyed a session at the WACA Test together. I also met the Secretary (East) of the Ministry of Foreign Affairs, Neelakantan Ravi in February and the former Indian Foreign Secretary and Ambassador to the United States, Lalit Mansingh, in March. In Rome, at the recent Food Security Summit, I met with India’s Agriculture Minister (and the Chairman of the Indian Cricket Board) Shawad Pawar.

This year a number of Indian Ministers have visited Australia: the Minister of Science and Technology, Kapil Sibal; the Minister for Youth Affairs and Sport, Mani Shanker Aiyer; the Minister of Civil Aviation, Praful Patel; the Minister of Commerce and Industry, Kamal Nath; the Minister of State for Steel, Jitin Prasada; and the Minister of State for Food Processing Industries, Subodh Kant Sahai. Soon I will host a visit by India’s Minister of External Affairs, Pranab Mukherjee for an Australia-India Foreign Ministers Framework Dialogue.

Common interests, common challenges

There is more than an economic complementarity between our two countries. There are more than ties of language and parliamentary democracy and respect for the rule of law, the law of contract and intellectual property.

There are profound values and interests we have in common.

There is much that Australia and India share, both in the region and globally.

India today is the world’s largest parliamentary democracy, assuming the mantle of global influence which its economic size and strength, and its strategic weight and history entitle it.

India is now rightly making its voice heard in the corridors of regional and international fora. Australia sees a country that combines a remarkable pace of domestic development with an active and constructive role in the regional and international arena.

We are both members of, and cooperate closely in, the ASEAN Regional Forum and the East Asia Summit. Australia also looks forward to attending meetings of the key South Asian regional body, the South Asian Association for Regional Cooperation (SAARC) to which we have sought observer status. _[1]

India is not so far a member of APEC, although Australia’s strong view is that India should become a member when the membership moratorium ends in 2010.

India’s expanding diplomatic role in Asia, which reflects the imaginative and skilful ‘Look East’ policy launched by former Prime Minister Narasimha Rao in the early 1990s, offers much scope for regional cooperation between India and Australia.

As the current Prime Minister, Dr Manmohan Singh has said, ‘Look East’ was,

“not merely an external economic policy, it was also a strategic shift in India’s vision of the world and India’s place in the evolving global economy”._[2]

Just as India now looks east, so must Australia now look west.

In this context, I look forward to discussing with Minister Mukherjee our Prime Minister’s idea for a new Asia-Pacific community, an idea that will work to promote greater strategic stability in our rapidly-developing part of the world.

As Minister Mukherjee said on 6 June, in Beijing: Asia needs,

“an open and inclusive architecture, which is flexible enough to accommodate the great diversity which exists in Asia…we must ensure that regional integration processes are inclusive so that they can contribute towards binding an Asian Economic Community that is open, transparent and inclusive, and that provides a platform to create ever widening economic opportunity”._[3]

Our cooperation is not just regional, it’s multilateral.

In 1947, when India achieved its independence, Australia and India then worked together to bring the conflict between the Indonesians and the Netherlands to the United Nations Security Council.

Following this cooperation, Prime Minister Nehru invited Australia to be represented at the Conference on Indonesia.

From this beginning, India has been a major contributor to the peacekeeping operations of the United Nations, as has Australia.

In recent times, we have worked together in East Timor, where India has deployed police officers. We both support the UN’s current peacekeeping efforts in Sudan.

India has a vital contribution to make as a serious and positive force in Asia’s future

Australia strongly believes that India, with its firm commitment to multilateralism, should have a permanent seat on a reformed United Nations Security Council. That world body must properly reflect the modern world.

I spoke before of the interests and values we share with India. These values underpin shared goals, such as our commitment to combat terrorism and extremism. And to tackle the adverse consequences of climate change, a global debate in which India will play such an important role.

Australia is ideally placed to work with India as it addresses two of its most critical strategic concerns, energy and food security. We also have shared interests in a stable, prosperous region, with a focus on maritime security and counter-terrorism.

In recent years, our defence forces have begun to engage in joint exercises, particularly maritime exercises. Military engagement is now occurring across the full range of activities, including ship visits, professional exchanges, and collaboration in research and development. There is much more that can, and will, be done in the fields of law enforcement and scientific and technical cooperation.

I plan to take these ideas forward and to advance practical initiatives in talks with Minister Mukherjee.

Australia and India are both committed to addressing the critical challenge of nuclear non-proliferation and disarmament, about which both of our two Prime Ministers have spoken publicly in recent days.

India shares our ultimate objective of nuclear disarmament and has a strong record on non-proliferation. Indian participation in the International Commission on Nuclear Non-Proliferation and Disarmament would of course be of great assistance.

Australia is developing a mature and broad-ranging relationship with India, one that can and does accommodate differences of opinion on particular issues, and one that still moves forward constructively and positively.

The Australian Government’s policy not to supply uranium to non-Nuclear Non-Proliferation Treaty countries is of long standing and well known.

The important point to note, however, is that Australia’s relationship with India goes far beyond this single issue.

Hidden changes, quiet achievers

In parallel with the growth in trade and investment I have described, we can see another quiet but powerful trend developing.

The fabric of our relations with India are being increasingly interwoven by enhanced people-to-people exchanges, people to people exchanges in educational, scientific, cultural and sporting areas.

This is greatly benefiting our society and our economy.

According to the 2006 census, the Indian community in Australia was the ninth largest ethnic group in Australia, at over 230,000. Their numbers are being swelled by what is now the largest source of skilled migrants to this country.

I’m proud to say that our country still offers opportunities to anyone determined to succeed. And Indians are certainly determined.

Take, as an example, Lisa Sthalekar. She was born in Pune and is the Australian women's cricket team vice-captain and New South Wales captain. For the second successive year, Lisa was named Women's International Player of the Year in February 2008.

These citizens and permanent residents are being joined by a stream of Indian students. Australia is now the second favourite destination for Indian students, worldwide.

There were over 50,000 enrolments last year alone.

In some ways, it’s easy to see how this can happen. We both speak English and argue about cricket. Our universities meet the standards and the curriculum choices of India’s high-achieving youth.

Graduates from our universities, like Kiran Muzumdar-Shaw, a prominent and highly successful businesswoman in India, who studied in Ballarat, do much to strengthen the network of ties between India and Australia.

It’s very noticeable that Indian-born immigrants are among the most highly qualified of any group in Australia. A very high number hold post-secondary qualifications and many are employed in professional and technical occupations.

Education provides unique opportunities for cultures to learn more about each other. Social interactions of this kind have a profoundly transforming effect.

We will continue to do all we can to strengthen ties between Australian and Indian educational institutions.

The Australia-India Strategic Research Fund, established in 2006, will provide A$20 million over five years to support a range of high quality joint projects.

It’s Australia’s largest bilateral science and research fund.

There is strong Indian interest in this fund, just as there is a considerable Indian appetite for greater cooperation with Australia in the field of biotechnology. Australia and India concluded a MoU on intellectual property in May this year.

The social networks between our two countries offer enormous potential for developing commercial and other relations.

Migrants from India are filling vital skills gaps in this State’s booming economy, and in Australia at large.

And just as Australians are acquiring a taste for all things Indian, Indians are increasingly aware of our own culture.

India is now Australia’s second fastest-growing tourism market. The number of Indian visitors is projected to grow at an average annual rate of 18 per cent over the next decade, helped by the resumption of direct air services between our two countries in 2004.

A growing number of Indian films – such as Chak De - are being shot on location in Australia, or having post-production work done here.

Our very own Brett Lee last year performed a duet with India’s favourite songstress, Asha.

In these endeavours which strengthen educational, cultural and scientific links, we have an active partner in the Indian Government.

India takes very seriously the potential of its enormous diaspora, which now exceeds 20 million people.

Conclusion

Today, I’ve spoken about why Australia attaches such fundamental importance to the relationship we have with India and why we want to take it to a new level.

India is emerging as an economic and strategic giant.

It is a country in our region with whom we have a lot in common and with whom we share close values and interests.

Australian industry already understands the importance of India to its future.

Universities such as this one, which host significant numbers of Indian students, have also seen the future.

The Australian Government fully appreciates how central India is to our future.

Just as India’s time has come, so too the time has come for our bilateral relationship with India to be a major foreign policy priority for Australia. We are committed to transforming our relationship with India for the long term: a new relationship for a new century. And in this great endeavour, we have a willing partner in India.

Thank you.