More than 80% of the world’s maritime oil trade passes through the Indian Ocean, but a new report from the United States Studies Centre (USSC) at the University of Sydney finds that Australia expends far fewer resources towards Indian Ocean security than it does towards Pacific Ocean security.

In An Australian Indian Ocean agenda to 2035, authors Professor Peter Dean (USSC Senior Adviser for Defence Strategy) and Alice Nason (USSC Non-Resident Fellow) analyse Australia’s engagement with the Indian Ocean region and provide a roadmap towards strengthening its strategic positioning over the next ten years.

“Historically, Australia has poured more energy and resources into bolstering security, protecting trade and supporting partners in the Pacific region than it has the Indian Ocean region,” Director of Foreign Policy and Defence Dr Lavina Lee noted, “Meanwhile, China has stepped up its efforts. Australia’s security agenda for the next ten years must include a larger and more strategic approach to the Indian Ocean region.”

The report finds that while Australia has closer proximity to the Indian Ocean than the United States or China, it has only 32 diplomatic posts in the region, compared to 49 for the United States and 60 for China. The report argues that resource scarcity and a predisposition towards Pacific-first thinking have constrained Australia’s efforts in the region.

Prof. Peter Dean said, “The Indian Ocean will be of critical importance over the next 10 years, but the good news is that strong progress on improving relations has been made and capitalising on this trajectory will mean that additional investments in diplomacy, security, infrastructure and economic ties will have an outsized influence in terms of driving Australia’s strategic agenda.”

An Australian Indian Ocean agenda to 2035 is now available to view or download.

Key recommendations

Diplomatically, Australia should:

  • Strengthen political representation: Building on the recent appointment of an Indian Ocean Envoy, appoint an Assistant Minister for the Indian Ocean to elevate regional engagement, akin to ongoing efforts in its Pacific strategy.
  • Expand diplomatic presence: Strengthen diplomatic posts in the Indian Ocean, especially in small states, enabling deeper engagement and supporting more frequent senior-level visits.

Economically, Australia should:

  • Develop a comprehensive Indian Ocean strategy: Create a dedicated Indian Ocean economic strategy as a successor to the 2018 India strategy, to both clarify and grow momentum around trade and investment priorities for smaller Indian Ocean states.
  • Support regional port infrastructure: Help develop port infrastructure in small states, in partnership with the private sector, with a focus on decarbonisation, digitalisation and operator capacity-building to stimulate intra-regional trade.

In the security sphere, Australia should:

  • Ensure AUKUS supports a regional balance of power in the Indian Ocean:Ensure AUKUS makes a purposeful contribution to ensuring Indian Ocean stability by investing in the necessary partnerships, infrastructure, workforce and public support to make the program sustainable.
  • Accelerate force posture initiatives: Fast-track the development of key defence facilities in Cocos-Keeling Islands and Northwest Western Australia.

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