Australia: The Bomb Could Be An Issue

ECONOMIC reform has been the driving force behind the deepening relationship between India and Australia. "We welcomed the whole process of economic reform and liberalisation in India in 1991...which seemed to move away from past introspection and self-reliance towards greater engagement with the outside world," says a senior Australian government official in Canberra. But India's increasing importance in the Asia-Pacific region will depend heavily on which party comes to power following the 1996 general elections. "A relationship that draws from the fact that we both speak English, we play cricket, we have a common system of law and democracy...all those things were and are relevant, but what we both need now is a relationship that reflects India's role in the region, and our capacity and role in the region as well," he adds.

Canberra believes that under a non-Congress government, reforms may take a different turn. "It may be at a slower pace, if there were a non-Congress government in power, or if there were a coalition," say government sources. "One might see a focus on poverty alleviation and a desire to divert funds into protecting more areas of the economy." Under a coalition, there's an apprehension that foreign investment in consumer goods and the role of transnationals in foreign investment might be negatively affected.

According to Shabbir Wahid, president of the Australia-India Chamber of Commerce, there is mounting concern among those who still don't have a foothold in the Indian market that five years of speedy growth will be followed by political and economic confusion. "It is the people standing on the sidelines (in telecom, roads and port development, to name a few), that we need to concern ourselves with," he says. "Because they are the ones who are going to see whether it is worthwhile going into the Indian market, or whether it is time to go elsewhere." While big companies like BHP, ANZ Grindlays and Kinhill Engineers already have a presence in the country, it is the bulk of the medium and small size companies that might be affected by a change of government.

Australia is hopeful that if, on the outside chance, the BJP does win the elections, its views on nuclear tests while in opposition will be quite different from the policy it adopts in government. "I think there is a strong streak of nationalism in the BJP—how far that will be translated into economic policy is difficult to tell. To what extent it would hold out against the NPT would also have to be tested," says the government official.

According to Sandy Gordon, an authority on India at the Strategic and Defence Studies Centre at the Australian National University in Canberra, even if India were to exercise its nuclear option and detonate a nuclear device, business relations with Australia would remain unaffected. "We would come in line behind the US and condemn it, but I don't think we would be in any position to take a high moral ground and impose an economic boycott or anything. But then again, we are not big players," he says.