By Rob Taylor
CANBERRA (Reuters) - Australia's foreign minister on Wednesday backed the formation of a security pact with India and the United States, saying it could be set up if Canberra ends a ban on uranium sales that has annoyed New Delhi.
It is the latest move by Australia to take a bigger role in the region's security. Earlier this month, it agreed to host a de facto U.S. base in the north of the country which would provide military reach into southeast Asia and the South China Sea, where China has disputes with several other states over sovereignty.
A new trilateral pact bringing in India into a U.S.-Australian security tent was worth exploring because "from little things big things grow," Foreign Minister Kevin Rudd said in an interview with the Australian Financial Review newspaper.
"The response from the Indian government has really been quite positive."
It was unclear why Rudd, a Mandarin-speaking Sinophile, would risk irritating Australia's top trade partner China which is already nervous that Obama's latest diplomatic push into the Asia-Pacific is part of broader U.S. policy to encircle it.
But Rudd earlier this month said Australia's security arrangements with the United States were not "snap-frozen in time," and while China wanted to see the elimination of U.S. alliances in East Asia, Australia disagreed.
"We are not going to have our national security policy dictated by any other external power. That's a sovereign matter for Australia," he said.
In a visit to staunch ally Australia this month, U.S. President Barack Obama also agreed with his host to explore the establishment of a joint naval base on Australia's Cocos Islands in the Indian Ocean.
Obama denied a strengthened U.S. presence in Australia and vital agreement for America's military to store equipment outside Japan and South Korea was aimed at countering a more assertive China.
But a prominent Chinese military commentator, People's Liberation Army Major General Luo Yuan, said this week that Washington was clearly trying to fence in Beijing.
"The United States is making much of its 'return to Asia', has been positioning pieces and forces on China's periphery, and the intent is very clear -- this is aimed at China, to contain China," Luo wrote on the website of the People's Daily newspaper.
China says its defense spending has grown sharply to around $95 billion, with an aircraft carrier recently launched and a stealth fighter aircraft unveiled amid renewed Chinese claims to parts of the Pacific and contested areas of the South China Sea.
Australia has embarked on its own $65 billion defense modernization including new assault ships, destroyers and warplanes, and is already involved in a tripartite economic and security dialogue with Japan and the United States.
U.S. officials have been particularly pushing Canberra to commit additionally to construction of a new fleet of 12 powerful missile submarines -- possibly of U.S. design -- in what would be the country's largest sole defense acquisition.
URANIUM SALES TO INDIA
A four-way security pact proposed by the United States in 2007 which would have drawn Australia, the United States, Japan and India together disintegrated when Japan and India floated concerns that it would look like an attempt to encircle China.
The idea of an Australian, Indian and U.S. trilateral security dialogue -- in part to counter China's rising naval power -- has been strongly pushed by a trio of influential strategic think-tanks in all three countries, but has yet to be formally adopted by any government.
But Rudd told the Australian Financial Review that a looming weekend vote and expected approval by Australia's ruling Labor Party to drop a longstanding ban on uranium sales to non-Nuclear Proliferation Treaty countries like India could help clear the way for formation of a new pact.
Michael McKinley, a security expert at the Australian National University, said an India-U.S.-Australia security pact was obviously directed at China.
"Alliances are always aimed at somebody. You don't have one just because you feel like regular cocktail parties," he said.
The influential Greens party, which controls the upper house balance-of-power, said a decision by the government to approve the sale of uranium to India would breach Canberra's obligations under a 1985 nuclear-free Pacific treaty.
"The arguments against this appalling back-flip continue to stack up, while the nuclear stooges offer nothing more than a fistful of dollars in exchange for indulging in a dangerous and illegal trade. Australia is better than that," said Greens Senator Scott Ludlam.
(Editing by Ed Davies and Jonathan Thatcher)