Australia appears to be oscillating around the same tumult that most of the world is facing today—how to deal with the People’s Republic of China? The exertion lies in finding ways to manage ties with a nation, which has rendered itself economically indispensable, is known for its proclivity to defy international norms, rules, and [mis]use the economic indispensability to arm-twist beneficiaries strategically—to fulfil the Chinese expansionist agenda. The just sworn-in Australian Prime Minister, Scott Morrison, confronts the dilemma of Canberra’s vitally important, yet often jittery relationship with Beijing.

Hours before taking oath as Australia’s Prime Minister, Morrison, in his two-day stint as Acting Home Affairs Minister, declared a ban on Chinese telecom firms Huawei and ZTE from participating in Australia’s 5G network. Earlier in 2016, Morrison blocked the sale of the New South Wales electricity provider Ausgrid to Beijing-run State Grid Corp and Hong Kong-listed Cheung Kong Infrastructure, citing national security reasons. Belonging to the conservative faction of the Liberal Party, Morrison is known to have played a key role in introducing new foreign interference laws, causing considerable strain in Beijing’s overall relationship with Canberra.

The above protectionist grounds and agenda notwithstanding, the staring reality is that China remains Australia’s largest trading partner, accounting for 32% of its goods exports—a situation that shall continue to remain likely so in the foreseeable future. Acknowledging China’s “growing influence on the regional and global issues of greatest consequence to our security and prosperity” the 2017 Foreign Policy White Paper declares that Australia “will continue to place priority on positive and active engagement with China” by strengthening the comprehensive strategic partnership. Perceptibly, the Chinese state-run and controlled media have not taken the recent policy pronouncements too well, with a People’s Daily editorial accusing Australia of nursing a “strong ideological prejudice on China and taking a discriminative approach, trying to politicise business operations”. Besides, Caixin Global, a Chinese financial magazine dubbed Morrison as the new Australian PM who has a “history of blocking Chinese investment”.

While the politics is making seeming attempts at tightening the noose, Australian strategic approach, of late, has been rather conciliatory, looking to turn diplomatic tide favourably towards China. The PLA Navy’s naval-guided missile Chinese frigate, Huangshan (Hull 570) arrived at Australia’s Darwin Port on 30 August 2018, to take part in the currently underway, multinational naval exercise, Kakadu 2018. The manoeuvres involving naval forces and observers from 27 countries including the US, Canada, India, Japan, among others, are witnessing a first-time participation of the Chinese Navy, ever since Kakadu came into existence in 1993—signifying the turning tide in regional strategic affairs. China’s Liberation Army Daily confirmed Chinese participation in a series of joint drills including joint anti-submarine operations, air-defence operations, search and seizure operations, and replenishment-at-sea etc.

By extending Beijing an invitation for the Kakadu maritime drills, Canberra stepped away from its ally, Washington, when the latter decided to “disinvite” Beijing from the 2018 Rim of the Pacific (RIMPAC) naval exercise. While Australia confesses that the Indo-Pacific’s stability depends on the actions of, and relations between, two of its most important partners—the US and China, it is known to condemn China’s militarisation of the South China Sea in a very measured way—as can be assessed by the numerous statements of Marine Payne, the Defence Minister.

In the three Defence White Papers that Australia has published in the 21st century, in 2009, 2013 and 2016, the latest one outlined six key drivers that shall shape the development of Australia’s security environment until 2035. Of these six, the ties between the US and China, likely to be characterised by a mix of cooperation and competition has been given adequate pre-eminence. For Australia, the US remains a long-standing alliance partner, and China, its deeply engaged economic and trade partner. Hence the quandaries to maintain a tightrope balance.

The defence policy circles within Australia concede that the growth of China’s national power, including its military modernisation, is an indicator of Chinese policies and actions holding a major impact on Indo-Pacific stability. The Chinese Navy becoming the largest in Asia with a submarine force that is likely to swell up to more than 70 submarines by 2020 remains a case in point.

While making an unspoken implicit reference to China, Australia reinforces the dilemma of most regional Asian players when it admits in an official government document, the 2016 Defence White Paper that “…major powers trying to promote their interests outside of the established rules-based global order have implications… raising the risk of military confrontation”. Far from being reassuring about its defence policies through means of greater transparency, Chinese quest for grander influence and control of the Indo-Pacific through revisionist means is manifest.

Dr Monika Chansoria is a Tokyo-based Senior Visiting Fellow at the Japan Institute of International Affairs (JIIA).