New Delhi: Australia’s escalating tensions with Beijing have shown up its reliance on China trade and propelled a push to increase links with Asia’s other giant economy, India. New enrollments of international students from India expanded 32% in 2019 from a year earlier and it’s the fastest growing major market for Australian services. India has overtaken China as the largest source of net migration to Australia, and its diaspora is the third largest Down Under, just behind China and the U.K.
India’s swelling population — set to overtake China’s in 2027 — suggests ongoing opportunities for Australia to diversify a trade portfolio that currently makes it the developed world’s most China-dependent economy. The need to switch things up has accelerated as ties sank to their lowest ebb in 30 years after Canberra’s calls for an international inquiry into Covid-19’s origins was taken by Beijing as a political attack, with China imposing barriers on barley, beef and wine from Down Under.
This has Australia looking to its democratic, cricket-loving ally to fill the void. Prime Minister Scott Morrison held a virtual summit with his Indian counterpart Narendra Modi in June and the two signed a defense agreement and upgraded ties to a Comprehensive Strategic Partnership. The trade ministers of Japan, India and Australia recently agreed to work toward achieving supply chain resilience in the Indo-Pacific region.
“We can sell India education, health care, and there’s potential in science and technology,” said Ian Hall, a professor of international relations at Griffith University in Queensland. “It’s much more the consumer market of India’s growing middle class than goods.”