INDO-PACIFIC · Indo-Pacific Insight Series, Volume 13, December 2018 PAGE 3. The rise of the...

INDO-PACIFICINSIGHT SERIES

The rise of the ‘Indo-Pacific’ in Australian grand-strategic discourse

Daniel Baldino, University of Notre Dame and Alan Bloomfield, University of Western Australia Volume 13, December 2018

Australia has enthusiastically embraced the "Indo-Pacific" as a way of defining its region. It has done so to: raise Australia’s profile; improve ties with India and Indonesia; to promote inclusivity, especially vis-à-vis China; and to facilitate balancing against China if Beijing becomes more assertive. Recent trends suggest Beijing really is set on dominating the region, and America’s credibility as an ally has diminished somewhat too. Accordingly, we explore coalition-building options with like-minded regional partners – "minilateralism" – designed to signal resolve to Beijing and form the basis of future "hard-balancing" policies if necessary.

Executive Summary 3

Introduction 4

The Rise of the Indo-Pacific in Australian Strategic Discourse 4

Improving bilateral relations 6

Reassurance and inclusivity 7

A China hedge? 8

Policy implications 10

Conclusion 12

About the Authors 14

CONTENTS

• Australia has adopted the Indo-Pacific concept to respond to changes in the international order. The Indo-Pacific is an important conceptual mechanism to accommodate and manage long-term geo-political and geo-economic shifts.

• Australia is refocusing its foreign policy on the Indo-Pacific region for four reasons: to increase Australia’s profile as a regional player; to improve bilateral ties with various regional states (particularly India and Indonesia); to promote inclusivity, especially vis-à-vis China; and potentially to allow for balancing against China in the event of more assertive Chinese behaviour.

• There is an inherent contradiction between these latter two purposes. Such actions represent a sort of ‘grand strategic hedge’ given the region’s stability cannot be assumed. In particular, the US-China relationship will remain a major source of strategic tension.

• Australia should play a more proactive leadership role in building and directing Indo-Pacific institutions and relationships. Further, managing future uncertainties will entail planning for a spectrum of potential scenarios.

• Australia’s options should therefore incorporate middle-power coalition-building strategies. This can make use of a ‘diplomatic entrepreneur’ role that strengthens regional economic, security and diplomatic networks.

EXECUTIVE SUMMARY


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1 P Michael Richardson, ‘Australia-Southeast Asia Relations and the East Asia Summit’, Australian Journal of International Affairs 59:3 (2005), 363.2 Shinzo Abe, ‘“Confluence of the Two Seas”, speech at the Parliament of the Republic of India, 22 August 2007.3 Australia’s top five trading partners in 2015 were: China (22.7%), Japan (10.3%), United States (9.8%), South Korea (5.3%) and Singapore (4.3%)): Department of Foreign Affairs and Trade, Australia's Trade in Goods and Services 2014-15 http://dfat.gov.au/about-us/publications/trade-investment/australias-trade-in-goods-and-services/Pages/australias-trade-in-goods-and-services-2014-15.aspx. Accessed 8 April 2018.4 Australia in the Asian Century (Canberra: Commonwealth of Australia, 2012); Strong and Secure – A Strategy for Australia’s National Interest (Canberra: Commonwealth of Australia, 2012); Defence White Paper 2013 (Canberra: Commonwealth of Australia, 2013).5 2017 Foreign Policy White Paper (Canberra: Australian Government, 2017), chapter 3; 2016 Defence White Paper (Canberra: Australian Government, 2016), chapter 2.6 ‘In Defence of the Indo-Pacific: Australia’s New Strategic Map’, Australian Journal of International Affairs 68:4 (2014), 471 & 473.7 Quoted in David Scott, ‘Australia’s Embrace of the “Indo-Pacific”: New Term, New Region, New Strategy?’, International Relations of the Asia-Pacific 13:3 (2013), 426.8 ‘The New “Pacific Century” and the Rise of China: An International Relations Perspective’, Australian Journal of International Affairs 64:4 (2010), 390.

INTRODUCTIONScientists have talked about a single Indo-Pacific biosphere for decades, but geo-strategists have only recently begun speaking in similar terms. This change in terminology towards an Indo-Pacific geopolitical region began in the mid-2000s: Michael Richardson argued that the East Asia Summit’s (EAS) creation heralded the dawn of a wider Indo-Pacific region .In 2007 Japan’s Prime Minister Shinzo Abe, while visiting India, proposed ”a dynamic coupling” of the Pacific and Indian Oceans ”seas of freedom and of prosperity”. Since then the concept has gained traction in America, India and to some extent Indonesia. Australia has also embraced the notion of an Indo-Pacific region enthusiastically.

This paper explores why Australia has done so, and identifies four broad purposes that substantially explain this shift in both focus and emphasis. The paper will then offer some policy advice, given the combination of China's rise and anxiety about America's global commitments. It argues that Australia should continue to formulate policy based on the assumption that the US will remain closely engaged with the region. But it should also take seriously the possibility that America’s commitment is unsteady and may waver. Accordingly, Australia should begin to (cautiously) explore other grand strategic options, including middle-power coalition-building strategies. Such a transparent strategy is designed, in part, to signal to China that regional states have the will and capacity to protect their own common interests without substantial American backing.

THE RISE OF THE INDO-PACIFIC IN AUSTRALIAN STRATEGIC DISCOURSEStarting in the 1980s, Australia preferred to define its region as the Asia-Pacific, reflecting the fact Australia’s trade flowed increasingly towards rapidly industrialising East Asia.3 The definitional shift identifying the Indo-Pacific as Australia’s region was enshrined in several key foreign policy documents released by the Gillard Labor government.4 The term has also featured very prominently in similar documents released by the Turnbull Coalition government.5

Material factors certainly played a part in explaining the shift: Rory Medcalf has argued that the Indo-Pacific formulation is descriptively accurate given ”accelerating economic and security connections between the Western Pacific and the Indian Ocean region are creating a single strategic system” and that ”organising principles … knit this region together, most notably the economic and strategic interactions of great and rising powers”.6 At the same time, Peter Katzenstein has argued that ”regions are, among other things, social constructions created through politics”.7 Thus, as Thomas Wilkins has put it, a regional definition is coined by some party for some scheme, recalling Robert Cox’s maxim that “theory is always for someone and for some purpose”.8 In other words, those who promote a particular definition of Australia’s region are acting purposefully. Advocates claim that their interpretation is superior to others, meaning it should inform concrete policy reactions like the reallocation of resources and refocused diplomatic manoeuvres.



9 ‘The “Indo-Pacific” Places Australia at the Centre of the Action’, The Australian, 14 April 2013.10 David Walker, Anxious Nation: Australia and the Rise of Asia, 1850-1939 (St Lucia: University of Queensland Press, 1999); Alison Broinowski, About Face: Asian Accounts of Australia (Melbourne: Scribe Publications, 2003); Richard A. Higgott and Kim Richard Nossal, ‘The International Politics of Liminality: Relocating Australia in the Asia-Pacific’, Australian Journal of Political Science 32:2 (1997), 169–185.11 Mark Beeson and Hidetaka Yoshimatsu, ‘Asia’s Odd Men Out: Australia, Japan, and the Politics of Regionalism’, International Relations of the Asia-Pacific 7:2 (2007), 227–250.12 Politics Among Nations: The Struggle for Power and Peace, 5th Ed. (New York: Alfred A. Knopf, 1978 [1948]), 77–78.13 ‘Interview with Alan Bloomfield’, University of Western Australia, Perth, 6 February 2018?.14 ‘Interview with Alan Bloomfield’, University of Western Australia, Perth, 22 February 2018?15 Colin Dueck, ‘Trump’s national security strategy: 10 big priorities’, The National Interest, 9 January 2018.16 Michael E. O’Hanlon, ‘On the 2018 National Defense Strategy’, Order From Chaos (Brookings Institution), 21 January 2018.17 1.

What, then, are Australia’s purposes? We identify and explore four principal policy directions and rationales.. First, to increase Australia’s significance and profile in the region. Second, to create the conditions for improved bilateral ties with various regional states (especially India and Indonesia). Third, to promote inclusivity, especially vis-à-vis China, to ensure the region remains peaceful and stable. And finally, to create the potential for balancing against China should it destabilise the region by launching a sustained bid for primacy. Notably, there is an inherent contradiction between these latter two purposes as they cannot happen simultaneously. Therefore, together they represent a sort of grand strategic hedge.

The first purpose is to make Australia a more important international player on the basis it has moved conceptually from the periphery of the Asia-Pacific to the pivot-point of the Indo-Pacific region. Brendan Taylor, for example, has argued that Australia is ”at the centre of the action” in the Indo-Pacific region.9 But why, precisely, would Australia want to do so? Arguably it does so in part for perceptual and diplomatic reasons; debates about whether Australia fits in Asia have raged since the 1980s10 and Australia has at times been considered one of ‘Asia’s odd men out’.11 Yet it is also linked to instrumental reasons. At the same time, Hans Morgenthau argued decades ago that all states seek prestige because

the policy of prestige is one of the instrumentalities through which [states] … try to achieve their ends.… [It] is as intrinsic an element of the relations between nations as the desire for prestige is of the relations between individuals.12

In particular, Australia wants to make itself indispensable to its primary ally, the United States. Former Defence Ministers Kim Beazley13 and Stephen Smith14 both confirmed in interviews with one of the co-authors that their understanding, after years of close contact with US policy-makers, is that American policy-makers value the Australian alliance highly, especially for geographical reasons. For instance, the so-called joint facilities (i.e. surveillance and communication bases) are an integral part of America’s global defence and intelligence infrastructure. It seems likely they will become ever-more important given the latest iterations of America’s National Security Strategy (NSS)15 and National Defence Strategy (NDS)16. Both flagged a significant US military build-up in the Indo-Pacific after confirming that geostrategic threats emanating from peer-competitor states – primarily China – will henceforth be prioritised over threats from non-state actors (including terror groups).

Australia’s 2017 Foreign Policy White Paper acknowledges that, with the backdrop of the Trump presidency and the uncertainty of his supposedly ‘America First’ foreign policy, age-old certainties about US primacy in the Indo-Pacific have become more contestable because:

Powerful drivers are converging in a way that is reshaping the international order and challenging Australia’s interests. The United States has been the dominant power in our region throughout Australia’s post-second world war history. Today, China is challenging America’s position.17



Indeed, Trump’s election – and his confrontational approach to the region since taking office – has caused some Australians to question the propriety of remaining a close US ally18. Nevertheless, both major parties have publicly committed to supporting and even upgrading ties to America, suggesting they believe Australia’s security is enhanced overall, for example, by ensuring military interoperability and other capabilities, especially long-range air power. For the foreseeable future, therefore, the US alliance will remain the cornerstone of Australian foreign policy despite policymakers stressing that ”Australia must be sovereign not reliant”.19

IMPROVING BILATERAL RELATIONS The second purpose behind Australia’s promotion of the Indo-Pacific formulation is more instrumental: to directly improve Australia’s relations with key like-minded regional partners. The 2017 Foreign Policy White Paper emphasised that the Indo-Pacific democracies of Japan, South Korea, India and Indonesia were of critical importance to Australia.20 Importantly, Australia’s relationship with India has often described as neglected by both scholars21 and policy-makers22. Similarly, the Australia-Indonesia relationship is crisis-prone despite the fact Canberra regularly identifies it as one of Australia’s most important partnerships.23

Regarding India, when its Prime Minister Narendra Modi visited Australia in late 2014 there was much optimistic Australian commentary concerning the prospect of improving bilateral ties with India.24 Indeed, one

commentator even argued that India might one day take up the slack if China’s demand for Australian resources diminishes.25 Both Australia and India are increasing the tempo of naval exercises and signing bilateral security co-operation agreements. Overall, they have been said to be ”natural partners to work together to resolve the issues facing the region”,26 particularly non-traditional threats like economic regulation and piracy. It seems reasonable to conclude that Australia’s promotion of the Indo-Pacific formulation is linked to these bilateral efforts. Unfortunately, however, the free-trade negotiations which had been ongoing from 2010 stalled in 2017. This was particularly seen regarding agricultural market access, when it became clear that India would not substantially open its highly-protected economy.27 Chacko and Davis have argued, the commonalities between Australia and India which are so often highlighted – English language, parliamentary democracy, common law, cricket, etc. – are actually little more than skin deep because the two states’ deeper worldviews are very different. Such divergences in reconstructing an interest-led regional strategy and related factors are likely to prevent the forging of something like a formal strategic alliance.28 Nevertheless, given such large untapped potential, Australia should continue to forge ahead with efforts to improve political ties and deepen trade links with India while being aware of the natural limits in the co-ordination of policy.

Similarly, Indonesia and Australia share the interest of maintaining regional stability to provide the conditions for continued security, development and economic growth.

18 ‘Paul Keating in Conversation’, Australian Foreign Affairs 1 (October 2017), 22-23; James Curran, ‘The Case for Recasting Australia’s Relationship with the US’, Australian Financial Review, 15 June 2017; Emma Alberici, ‘Exploring the Future of the US-Australia Relationship’ (transcript, interview with Bob Carr and Jeffrey Bleich), ABC News, 3 May 2017; Benjamin Zala, ‘Issues in Australian Foreign Policy: January to June 2017’, Australian Journal of Politics and History 63:4 (2017), 612.19 Foreign Policy White Paper 2017, iii.20 Foreign Policy White Paper 2017, 40.21 Peter Mayer and Purnendra Jain, ‘Beyond Cricket: Australia–India Evolving Relations’, Australian Journal of Political Science 45:1 (2010), 134.22 Tony Abbott, ‘India and Australia: Ties that Bind’, The Hindu, 5 September 2014.23 Ken Ward, Condemned to Crisis?. Melbourne, Lowy Institute Paper.24 Abbott, ‘India and Australia’; Amanda Hodge, ‘At Last, a Serious Passage to India’, The Australian, 19 November; ‘Australia-India Roundtable Report: Outcomes Statement and Summary Record of Proceedings’, Lowy Institute, February 2014; Sunil Venaik and Paul Brewer, ‘India-Australia Trade Push Another Win for Bilateralism’, The Conversation, 19 January 2015.25 Greg Sheridan, ‘India Our Third Great Asian Growth Story’, The Australian, 19 November 2014; Judith Ireland, ‘How Narendra Modi turned Parliament House into a rock star's stage’, The Australian, 19 November 2014. 26 Julie Bishop, ‘Charting the Future of Australia-India Relations’, Australian Polity, 2:3 (2012). At http://australianpolity.com/australian-polity/charting-the-future-of-australia-india-relations. Accessed 22 July 2018.27 Mark Kenny, ‘Malcolm Turnbull Kills off Tony Abbott's India Free Trade Deal, for Now’, Sydney Morning Herald, 11 April 2017. Australian policies, especially the decision to restrict temporary work permits, also contributed to the breakdown: see James Bennett, ‘Government’s 457 Visa Scrapping Could Affect India Trade Negotiations,’ ABC News, 19 April 2017.28 Priya Chacko and Alexander E. Davis, ‘The Natural/Neglected Relationship: Liberalism, Identity and India–Australia Relations’, Pacific Review, 30:1 (2017), 26-50.

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Nevertheless, a disturbing tendency for recurring crises to upset ties remains over issues such as: the rights of refugees seeking to reach Australia; the ethics of the live cattle trade; criminal justice (i.e. especially the sentencing of Australian drug traffickers); freedom of expression in Indonesia; and the status of West Papua.29 Indonesia’s ambassador to Australia Nadjib Riphat Kesoema, however, has described these as ”short-term shocks” and confirmed that he believes the bilateral relationship remains on an ”upward trajectory”.30 The advance of closer ties are most-evident in the security realm. Australia and Indonesia remain committed to actively cultivating ties to combat transnational terrorism and to counter the threat of foreign fighters returning from Syria and Iraq. Further, consecutive Australian governments have pledged new levels of co-operation on defence including increased military exercises, extended maritime security cooperation and, more recently, the full restoration of military-to-military links. Likewise, Australia’s 2016 Defence White Paper claimed that the modernisation of the Indonesian armed forces and Indonesia’s mounting regional influence in the Indo-Pacific were ”positive developments” in efforts to consolidate bilateral relations.31

Progress has been more difficult in the economic realm, although there have been positive signs. In 2015, the Australian Prime Minister and Indonesian President declared the countries wanted to improve economic ties by liberalising trade and investment. Indonesia subsequently lowered its sugar tariffs to 5%, in line with other ASEAN states. In return, Australia abolished tariffs on pesticides and herbicides.32 However, further progress has been difficult. As 2017 ended, Indonesian officials were lowering expectations regarding both when a free-trade deal might be signed and how comprehensive it might be33. Like India’s, Indonesia’s economy is heavily protected.

More could also be done in the realm of security policy. For example, reports emerged in early 2017 that Indonesia floated the possibility of conducting joint freedom of navigation patrols with Australia near the newly-constructed Chinese islands in the South China Sea. However, the Australian government reportedly sent back-channel messages that, in effect, ‘now was not the time’, so a formal request was never made.34 Still, it is notable that Indonesia has indicated that it wants to continue to co-ordinate with Australia in the Indo-Pacific waters which are of great trade and strategic importance to both countries. This remains a positive development. Australia needs to build and retain a strong and productive relationship with Indonesia across political, security and commercial links.

REASSURANCE AND INCLUSIVITYThe third purpose behind Australia’s Indo-Pacific redefinition is to foster a more inclusive and resilient region, and in so doing, to enhance regional stability. This is the purpose articulated most often by policy-makers. For example, the 2017 Foreign Policy White Paper argued that:

The stability and prosperity of our region will depend on how major-power relations evolve, particularly between China, India, Japan and the United States. A degree of competition is inevitable as Asia’s strategic order changes. But all countries in the region have a deep investment in stability and economic growth: the complex interdependencies and growing bilateral engagement are strong stabilising forces.35

In particular, Australian policy-makers want to reassure China. The 2016 Defence White Paper addressed the competitive geopolitical

29 Greta Nabbs-Keller, ‘A frank and refreshing assessment of Australia-Indonesia relations’, Lowy Interpreter, 23 July, 2015; Ward, Condemned to Crisis?; Andrew Phillips and Eric Hiariej, ‘Beyond the “Bandung Divide” Assessing the Scope and Limits of Australia-Indonesia Security Cooperation’, Australian Journal of International Affairs 70:4 (2016), 422-440.30 Paul Osborne, ‘Turnbull to make first trip to Jakarta’, SMH, November 2, 2015.31 Defence White Paper 2016, 59.32 Paul Karp, ‘Australia and Indonesia announce restored defence cooperation’, The Guardian Australia, 26 February 2017.33 Matthew Busch, ‘The Ill-Advised Rush for Australia to Strike a Trade Deal with Indonesia’, The Interpreter (Lowy Institute), 7 December 2017.34 Amanda Hodge, ‘Indonesia Backs Away from Joint Patrols with Australia in the South China Sea’, The Australian, 7 March 2017; Prashanth Parameswaran, ‘The Truth About Joint Indonesia-Australia South China Sea Patrols’, The Diplomat, 25 February 2017.



dynamics in the Indo-Pacific – noting regional points of friction and intensifying China-US rivalry – but it also confirmed that Australia does not approach China as an adversary. Rather, Australia’s ”policy is aimed at encouraging China’s peaceful rise and ensuring that strategic competition in the region does not lead to conflict”.36 Specifically, Australia believes that China should recognise that it has benefited enormously from the liberal trading order and, therefore, it should accept and support this status quo.37 Accordingly, it can be argued that the purpose is to encourage China to play by the rules – the established rules-based order, shaped during America’s hegemony – in the Indo-Pacific.38 The 2017 Foreign Policy White Paper pointedly encouraged China to ”exercise its power in a way that enhances stability, reinforces international law and respects the interests of smaller countries”.39

A CHINA HEDGE?Accordingly, some scholars have concluded that the fourth – and in their view, the primary – reason for promoting the Indo-Pacific formulation is that Australia wants to, if not precisely contain China, then at minimum actively dissuade it from taking more assertive and possibly reckless unilateral steps which might excite confrontational responses from other actors. Bisley and Phillips have argued that ”[v]iewed from Beijing, … [the Indo-Pacific] appears to … keep the United States in, lift India up, and keep China out”.40 Despite the scale of strategic and economic shifts, the Chinese government itself has been decidedly dismissive of the Indo-Pacific concept, characterising it as an idea which will ”dissipate like ocean foam”.41

Some have argued that Australia’s efforts to improve its ties to India are motivated in part by a desire to essentially recruit India as a potential balancer against China.42 It is therefore worth noting that the Indo-Pacific formulation has found much (but not universal) support in India. Priya Chacko found the most enthusiasm in think-tanks, especially those with close links to similar American and Australian institutions; but, ultimately official government statements always stress the inclusive interpretation. Chacko attributes this to India’s long-standing, deep-seated attachment to non-alignment – or, in modern parlance, strategic autonomy – which makes it difficult for Indian policy-makers to openly embrace balancing against China.43 Yet outside official circles some individuals – especially former generals and admirals – are much more forthright about what they see as the ‘China threat’ and the necessity to balance against it.44 Indeed, others have argued that India has been actively balancing against China for over a decade.45 Nevertheless, the recent move in 2017 to re-establish the Quadrilateral Security Dialogue – or ‘the Quad’, as it is often called – as a loose but still formalised diplomatic and potentially military counterweight to China is highly relevant.

Previously, in 2007 – and during the same speech to India’s parliament in which he promoted the Indo-Pacific – Japan’s Prime Minister Shinzo Abe called for US-Japan-India-Australia ties to evolve into a broader partnership of Asia democracies.46 But the initiative largely failed. China reacted angrily, arguing it was reminiscent of a cold-war mentality and marked ”the formation of a small NATO to resist China”47. Subsequently all four prospective members effectively shelved the

35 14. 36 Defence White Paper 2016, 6. 37 Foreign Policy White Paper 2017, 20-21; Andrew Clark, ‘Julie Bishop and the Australia-China Relationship’, Australian Financial Review, 18 May 2018.38 Michael Wesley has called this policy ‘socialisation by inducement’; ‘Acronyms at Twenty Paces: Regional Agreements and Strategic Rivalry in Asia’, paper presented at Ten Years Since the Australia-US Free Trade Agreement: Where to for Australia’s Trade Policy?, Sydney, UNSW, 26 September 2014, 9.39 Ibid., 39.40 Nick Bisley and Andrew Phillips, ‘The Indo-Pacific: What Does it Really Mean?’, East Asia Forum, 6 October 2012. At http://www.eastasiaforum.org/2012/10/06/the-indo-pacific-what-does-it-actually-mean/. Accessed 8 April 2018.See also: Chengxin Pan, ‘The “Indo-Pacific” and Geopolitical Anxieties about China’s Rise in the Asian Regional Order’, Australian Journal of International Affairs 68:4 (2014), 45441 Bill Birtles, ‘China Mocks Australia over 'Indo-Pacific' Concept it says will “Dissipate”’, ABC News, 8 March 2018.42 Jeffrey Wilson, ‘Rescaling to the Indo-Pacific: From Economic to Security-Driven Regionalism in Asia’, East Asia 35:2 (2018), 181.43 ‘The Rise of the Indo-Pacific’, 445-447. More detail?44 For examples, see: Chunhao Lou, ‘US-India-China Relations in the Indian Ocean: A Chinese Perspective’, Strategic Analysis 36:4 (2012), 629–633.45 Mohan Malik, ‘India Balances China’, Asian Politics and Policy 4:3 (2012), 345–376.46 Abe, ‘Confluence of the Two Seas’. More detail?47 Cheng Sun, ‘A Comparative Analysis of Abe’s and Fukada’s Asia Diplomacy’, China International Studies 58 (Spring 2008), 66.

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idea. However the Quad has been revived as an informal alignment of like-minded states to advance common goals (i.e. not a formal multilateral alliance to coordinate hard-balancing and/or outright containment).48

There is therefore some degree of natural affinity between the Indo-Pacific regional formulation and the Quad. But redefining the region in Indo-Pacific terms is a more ambiguous – and so more-diplomatic, less-threatening – way of sending cautionary signals to China (as opposed to joining a Quadrilateral alignment of regional democracies with a military bent).It can be argued that Australia embraced the Indo-Pacific regional formulation, at least in part, to add some additional ballast to the ‘balancing’ side of the grand strategic hedging policy it has been pursuing towards China for over a decade.49 Further, one might surmise that doing so failed to rein in China’s nationalism and assertiveness, such as a pattern of aggressively contending sovereignty claims in the South China Sea. Hence the Quad has been revitalised to send a stronger message in more explicit terms.

Thus, the third and fourth purposes behind Australia’s promotion of the Indo-Pacific formulation constitute a grand-strategic hedge. In other words, Australia would prefer that China becomes a responsible regional stake-holder and supporter of the status quo. But if it fails to do so, the conditions will be more conducive to balancing more directly and harder against China.50 Having said this, such assumptions have no doubt been complicated somewhat by a Trump administration that appears inward-focused, fickle and indifferent to improving America’s diplomatic capacity.51 While the recent NSS and NDS called for the US to continue to demonstrate leadership and remain committed to allies – as opposed to retreating into isolationism – Trump himself remains a very

impulsive policy-maker. Hugh White’s recent claim that ‘America seems to have abandoned the objective of resisting China’s Challenge in Asia’ is arguably premature.52 All the same, the Indo-Pacific is in transition, the US is facing declining relative power and the Trump White House is defined by its unpredictability. Australian policy-makers will no doubt watch very carefully to confirm that America’s actions match its rhetoric.53

Additionally, when asked to comment on Australia’s 2017 Foreign Policy White Paper, a spokesperson for China’s Ministry of Foreign Affairs, Lu Kang, noted the pace and scale of China’s maritime behaviour – including its territorial claims and island-building activities – would not abate anytime soon. This illuminates the complexity of the challenge Australia faces to maintain the regional geopolitical status quo. Despite the paper’s mild criticism and circumspect language, Kang urged Australia to ”stop making irresponsible remarks on the South China Sea”.54

While Australia has been willing to scold and even implicitly-threaten China rhetorically, it has not backed up the tough talk in the realm of action, most notably by refusing Indonesian and (repeated) US requests to conduct freedom of navigation operations in the South China Sea.55 Ultimately Australia’s current grand-strategic hedging strategy towards China relies heavily on America remaining strategically engaged and invested in the region. This in turn might be jeopardised if America’s allies continue to (from Trump’s perspective) ‘free-ride’ on America’s strategic commitment to the region. In other words, simply redefining Australia’s region as the Indo-Pacific is arguably not enough. Australia (and other US allies) may have to begin shouldering more of the balancing burden in regard to alliance commitments.

48 ‘J Berkshire Miller, ‘The Quad: Security Cooperation Between the US, Japan, India and Australia’, Indo Pacific Insight (Perth US-Asia Centre), 49 Alan Bloomfield, ‘To Balance or to Bandwagon? Adjusting to China’s Rise During Australia’s Rudd-Gillard Era’. Pacific Review 29:2 (2016), 259-282.50 I.e. strategic hedging involves ‘a country seek[ing] to offset risks by pursuing multiple policy options that are intended to produce mutually counteracting effects, under the situation of high-uncertainties and high-stakes’: Cheng-Chwee Kuik, ‘The Essence of hedging: Malaysia and Singapore’s Response to a Rising China’, Contemporary Southeast Asia 30:2 (2008), 168. For a sustained illustration that Australia pursues grand strategic hedging vis-à-vis China, see: Bloomfield, ‘To Balance’.51 Julian Borger, ‘Trump sticks to the script on Asia tour – but still leaves confusion in his wake’, The Guardian, 14 November 2017.52 ‘Without America: Australia in the New Asia’, Quarterly Essay 68 (2017), 20.53 Ashley Townshend, ‘Donald Trump is ripping up the Pacific Status Quo’, The Australian Financial Review, 12 July 2018.54 Cited in Lowy Interpreter, ‘How the region reported the Foreign Policy White Paper’, 15 December 2017. 55 ‘Without America’, 48. More details?



POLICY IMPLICATIONSGiven such a back-drop of inter-state strategic uncertainty and competition, policymakers will need to identify realistic objectives and propose careful policy limits. Australia should build on its well-established middle power tradition to play a ‘diplomatic entrepreneur’ role. This will require recognising the limits of the US alliance while investing time and effort in building Indo-Pacific institutions like the Indian Ocean Regional Forum (IORA) and the EAS, to promote and direct a collection of rules, beliefs and practices which support a more stable and interest-led security setting for the Indo-Pacific. Additionally, Australian policy makers should explore the possibility of, as Medcalf and Mohan have put it, forming middle-power coalitions with other like-minded regional states as a form of security multilateralism to advance goals and reduce risks in the region.

In regard to investing in classic multilateralism, Australian regionalist proposals have at times faced resistance from ASEAN states, who traditionally prefer to drive regional initiatives.56 Nevertheless, Australia must step up its leadership. Policymakers should grasp the opportunity afforded by the widening of what constitutes ’the region (and the growing doubts about ASEAN’s effectiveness in the era of a rising China57) to make existing regional institutions more effective, in part, to build trust and confidence. For instance, while Australia chaired IORA (2013-2015) it sought to re-engage a more inclusive, future-orientated focus by promoting issues such as maritime safety and security, the blue economy and women's economic empowerment. Given the growing unease over China’s steady push into the Indian Ocean – the so-called ‘string of pearls’ strategy58 – in the US, Indonesia and India (see below), Australia should continue to try to strengthen IORA as a forum at which both traditional and non-traditional (i.e. piracy, people-smuggling, disaster relief, etc.) security issues are addressed and managed. Importantly, a refusal by China

to play the role of a responsible stake-holder would help to justify subsequent moves towards more assertive and co-ordinated policies. Specific blueprints about what sort of assertive, principle-led policies could be pursued, and how they might be implemented, are inspired by a policy paper written by as Rory Medcalf and C. Raja Mohan.They premised their advice on the assumption that:

[u]ntil recently it was widely hoped that a combination of economic interdependence and regional institutions would mitigate great power rivalry... This hope, however, now seems forlorn… [given] the risky trajectory of US-China relations’.59

They noted that Japan, India, Indonesia and Australia, combined, exceed China’s population, match its GDP and spend about 70% of what China spends on defence, suggesting these Indo-Pacific middle powers “have their own kind of strength in numbers, if only they can coordinate their capacities better”.60 Specifically, Medcalf and Mohan rejected forming yet another formal regional multilateral organisation in favour of ”an array of overlapping coalitions… [and] flexible partnerships… [or] loose, self-selected minilateral arrangements”. Such arrangements would aim to coordinate political interests, diplomatic initiatives, intelligence exchanges, war gaming (and possibly even military interoperability), technology-sharing and, finally, capacity-building in other, small regional states.61

As such, Australian policy-makers must begin to seriously explore the feasibility of such an approach. Initially such arrangements should broadly focus initially on coordinating policy with regard to less-contentious non-traditional security concerns. If such efforts succeed in the main, efforts to tackle more difficult geo-strategic issues could begin. These could take the form of military capacity building

56 Frank Frost, Engaging the Neighbours: Australia and ASEAN since 1974 (Canberra: ANU Press, 2016), 163.57 Mark Beeson, ‘Living with Giants: ASEAN and the Evolution of Asian Regionalism’, TRaNS: Trans-Regional and -National Studies of Southeast Asia 1:2 (2013), 303-322.58 David Brewster, ‘Beyond the ‘String of Pearls’: is there Really a Sino-Indian Security Dilemma in the Indian Ocean?’, Journal of the Indian Ocean Region 10:2 (2014), 133-149.59 ‘Responding to Indo-Pacific Rivalry: Australia, India and Middle Power Coalitions’, Lowy Institute: Analysis, August 2014, 2.60 Ibid., 7.61 Ibid., 13-15.



and regular joint military exercises (without US forces). For instance, joint weapons-procurement programmes along similar lines to how European states built the Eurofighter Typhoon (although naval building programmes would seem more suitable in the Indo-Pacific context). Likewise, maritime activities like the Indo-Pacific Endeavour should be prioritised in ongoing efforts to build partner capacity and improve military interoperability throughout the Indo-Pacific.

More assertive actions to build up maritime security might also include India, Japan and Indonesia (or even just one or two of these Indo-Pacific middle powers) contributing maritime surveillance assets to Australia’s long-established Operation Gateway. This program has conducted regular surveillance over-flights of the South China Sea since 1985. If doing so did nothing to change Chinese behaviour the ante could be upped by, for example, conducting one or more joint freedom of navigation operations (i.e. sailing within 12 nautical miles of one of China’s artificial islands).Crucially, these engagement activities should proceed without US Navy vessels to demonstrate that the participating states were not ”paper cats”62 and were, instead, capable of standing up to China without direct American involvement.

Such advice is controversial, not least because China would likely regard the last option just described as very provocative. Nevertheless, this broader minilateral strategy is an option that should be considered by Australian policy-makers. At the very least, it would enable participating states to jointly and repeatedly send unmistakable signals to China that they share similar perceptions on China’s behaviour. In short, it would demonstrate a preparedness to act jointly to protect common interests and manage strategic tensions.

In fact, there are some tentative signs of this sort of approach developing already. Japan and India are reportedly close to signing a deal for India to receive 12 US-2i maritime surveillance planes63. India and Indonesia also

recently signed an agreement to develop Sabang as a naval base at which Indian Navy vessels could resupply64. Furthermore, after signing the Framework of Security Cooperation in November 2014, Australia and India have committed to holding regular AUSINDEX naval exercises.65 However, sending a collective message to China might require more joint and regular initiatives.

Such advice remains conditional. The argument is not that Australia should immediately begin to assiduously coalition-build against China. Instead, it should move forward in a carefully-calibrated manner, only escalating the joint-signals being sent to China if it is clear that the last initiative tried had no appreciable effect on China’s behaviour. The dangers of moving too-fast along a pre-determined path are two-fold; doing so might unnecessarily provoke extreme responses from China while also undermining the integrity of the coalition-building process itself.

To clarify further, Australia’s current default grand-strategic posture remains characterised by a close strategic alliance with the United States. This paper does not challenge the validity of this position in the main. Australia should continue to look for opportunities to strengthen US influence in the Indo-Pacific region by encouraging economic, political and military interactions that range from port visits to intelligence sharing to technological exchanges. This framework is based on the premise that US policy will continue to reflect what is said in formal policy documents like the NSS rather than what Trump said while on the campaign trail and during his presidency. The pursuit of minilateralism should thus be considered a ‘second hedge’ against the possibility of America substantially downgrading its strategic engagement with the region. At the same time, good relations with the US should not be seen as an end goal in itself. The US and Australia will continue to have overlapping but not automatically identical national interests.

62 Chinese journalists described Australia as ‘not even a “paper tiger”, it’s only a “paper cat” at best’ after Australia endorsed the Permanent Court of Arbitration’s adverse ruling against China concerning the South China Sea; ‘“Paper Cat” Australia will Learn its Lesson’, Global Times, 30 July 2016.63 Franz-Stefan Grady, ‘Are India and Japan About to Conclude a $1.3 Billion Military Aircraft Deal?’, The Diplomat, 17 April 2018.64 Agustinus Beo Da Costa, ‘Indonesia, India to Develop Strategic Indian Ocean Port’, Reuters, 30 May 2018.65 ‘India-Australia Joint Statement during the State visit of Prime Minister of Australia to India’, Ministry of External Affairs (India), 10 April 2017.



CONCLUSIONThis paper has argued that Australia has enthusiastically redefined its region for a number of reasons. Some could be characterised as objective in the sense that the Indo-Pacific is a better description of where the most vital economic and strategic interests which Australia must advance or protect are located. Significantly, it correctly identifies the strong connection between geo-economical and geopolitical shifts and trends. However, the main thrust of the argument was that regional redefinitions are also made by purposive actors pursuing particular goals. Indo-Pacific terminology has been increasingly incorporated into formal policy documents, security dialogues and a wider bipartisan mindset, and it is also being increasingly accepted elsewhere in the region.

Notably, the 2016 Defence White Paper committed Australia to a decade-long increase in defence budgets,66 most of which will be spent on enhancing the ADF’s naval and air assets (i.e. precisely the sort of weapons systems which facilitate operations in the enormous Indo-Pacific).67 A significant portion of this new spending is tied to ensuring positive contributions to ADF military modernisation. This

includes investing in long-term defence assets such as Reconnaissance Helicopters, Hobart-Class Air Warfare Destroyers and F-35A Lighting II Joint Strike Fighters. It seems that presently (as Hugh White argues) this is designed to create a more robust ADF primarily configured to slot into America’s line of battle, presumably to confront a major conventional military power like China.68 This paper does not reject such a direction outright by calling for a revolution in Australian grand strategy by, for example, abandoning the ANZUS alliance. Instead, it would be prudent for Australia to begin diversifying its grand strategic options and expand its regional military and defence networks, slowly but steadily. In stepping up its leadership role and in seeking greater self-reliance within a wider US alliance context, Australia should re-balance and cultivate more diffuse and numerous links with like-minded Indo-Pacific middle powers. Actors who are all engaged in security co-operation and who have a sharp focus on the dynamics and inter-connectives of the region. The move to defining the region in Indo-Pacific terms provides the intellectual underpinning to support an evolution of this sort in Australian grand strategic thinking.

66 Daniel Baldino and Andrew Carr, ‘The end of 2%: Australia gets serious about its defence budget’, The Conversation, February 26 2017.67 Defence White Paper 2016, chapter 8.68 ‘Without America’, 54-56. More detail?



ABOUT THE AUTHORS

Daniel Baldino is a Senior Lecturer in the School of Arts and Sciences and Discipline Head of the Politics and International Relations program. His research focuses on Australian foreign and defence policy, security governance and intelligence, policing and spycraft. He is currently the Western Australian chapter convener for Australian Institute for Professional Intelligence Officers (AIPIO) as well as an Associate Editor for the Journal of the Indian Ocean Region.

Alan Bloomfield a Lecturer in the School of Social Sciences. His research focuses on Indian and Australian foreign policy, plus global norm dynamics, especially humanitarian intervention norms.

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INDO-PACIFIC · Indo-Pacific Insight Series, Volume 13, December 2018 PAGE 3. The rise of the...

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