Aukus pact will not change Indo-Pacific power balance anytime soon

Aukus pact will not change Indo-Pacific power balance anytime soon

Sep 21, 2021

THE new trilateral defence partnership among Australia, Britain and the United States announced last week that would enable Canberra to get eight nuclear-powered submarines drew a predictable response from Beijing. What none of the three parties seems to have factored in was France's furious reaction.

The so-called Aukus pact also includes Australia acquiring long-range strike capability, unmanned undersea drones, and artificial intelligence and quantum computing technologies. But the new deal also meant cancelling a contract worth up to A$90 billion (S$88 billion) with France to build 12 new diesel-powered submarines to replace Australia's ageing and trouble-plagued Collin class fleet. Given that the French submarine was designed to be nuclear-powered and that it was Canberra's insistence that the boats be modified to fit diesel engines that caused delays, Paris may have good reason to be miffed. But beyond the acrimony that goes with any soured deal, the pact is not going to change the power balance in the Indo-Pacific anytime soon. It will take more than a decade for Australia's nuclear-powered subs to fully come into service.

So, what is the Aukus pact about? The timing of the announcement should be noted. US President Joe Biden has taken a beating in opinion polls after the Kabul pullout. He certainly needs to tilt the narrative away from the Kabul debacle which has been under relentless attack from his political opponents. The Aukus pact may help to outflank his critics; his administration will be proclaimed as being totally focused on the China threat and Pacific stability, rather than the peripheral issue of the fate of Afghanistan.

The timing may also have been coincidental in a bigger China strategy. Earlier this month, US Trade Representative Katherine Tai and Commerce Secretary Gina Raimondo were reported to have had discussions on China's use of industrial subsidies and their impact on American firms and, more broadly, the US economy. Also discussed were the undertakings that Beijing gave to get a trade truce with then president Donald Trump. Under the agreement that came into force in January last year, China committed to buying an additional US$200 billion of American goods in 2020 and 2021 relative to the 2017 import baseline. Beijing fell well short of the target last year and is again projected to be 30 per cent short this year.

If Washington begins hearings on Beijing's subsidies and its purchasing shortfalls, it could create enough diplomatic friction - and headlines - that may silence Mr Biden's Republican critics. China is the one issue on which both sides of the political aisle stand united. And the Chinese Communist Party has always used subsidies of one sort or another to propel companies and industries that it deems to be of strategic value.

For Britain's Boris Johnson, the deal provides substance for his claim that the country has a new global role after Brexit. Australian Prime Minister Scott Morrison has been politically on the ropes in recent months over his coalition's handling of vaccine supply for the pandemic. The announcement of this new military partnership has electrified his supporters. So it is a chance to change the subject and project his government as having revived an alliance with both Washington and Britain, traditional allies who trigger considerable emotional resonance with Australians.

Will the pact spark off an arms race in the region? China deploys six nuclear-powered submarines. India has one and another is being built. Both also hold nuclear weapons. Japan's submarine fleet is entirely conventional, as are those of South Korea, Indonesia, Vietnam, North Korea and Pakistan. Some of these conventionally armed nations may now reassess their requirements and seek to match Australia's build-up.