WASHINGTON ― Australia’s defense minister said that his country’s nuclear-powered submarine pact with the U.K. and the U.S. still faces regulatory hurdles that hinder defense industrial cooperation.

Speaking after a meeting of top U.S. and Australian officials here this week, Richard Marles said there was more work to do, despite “real steps” so far, to “create a more seamless defense industrial base between our two countries” and a shared commitment to do so.

“We need to be working closer together to enhance our military capability and to develop new technologies. But for all of that to happen, it’s really important that we do everything we can to break down barriers which exist in regulation between our two countries,” said Marles, who is also deputy prime minister.

The tri-national pact between Australia, the U.K. and the United States – known as AUKUS – will eventually provide Australia with nuclear reactors to power its submarines and permit collaboration on a range of technologies, including hypersonics, artificial intelligence and undersea warfare.

Washington announced plans this week to increase U.S. rotations of bomber task forces and fighters in Australia in addition to adding Army and Navy rotations there.

The moves in 2023 dovetail with rotations this year of F-22, B-2 and B-1 aircraft, and with fuel, runway and ordnance storage infrastructure projects underway at the Darwin and Tindal air fields.

With logistics cooperation, the countries are expanding locations for U.S. Army and Marine Corps forces in Australia. The sites would chosen to best enable exercises, activities, and opportunities for regional engagement, according to a Pentagon spokesman.

U.S. Defense Secretary Lloyd Austin made the announcement after meeting with Marles, Australian Foreign Minister Penny Wong and U.S. Secretary of State Tony Blinken.

Amid concerns Australia’s nuclear-powered submarines won’t be built and come online until the 2030s, Austin vowed that Australia would not be left with a capability gap while it waits. He said the goal was for Australia to receive the submarines “as quickly as possible.”

The three countries plan to announce the optimal pathway for Australia’s acquisition of the subs in early 2023, which would cap an 18-month consultative period.

“So we will not allow Australia to have a capability gap going forward,” Austin said.

Asked whether Washington would consider selling Australia the newly unveiled B-21 Raider bomber, Austin said it was not part of the discussions.

Austin also said that under the AUKUS arrangement, the U.S. will also expand logistics and sustainment cooperation to deepen interoperability ― and find ways to integrate the two countries’ defense industrial bases.

On Thursday, at the Aspen Security Forum, Australia’s ambassador in Washington, Arthur Sinodinos, expressed some confidence the U.S. was driving the process of defense industrial integration forward but, like Marles, pointed to bureaucratic speed bumps.

“The other part of this is that the Congress is taking an interest in industrial base integration,” Sinodinos said. “And so they’re keen to find ways to also reduce the red tape around this. So I think this is a pincer movement, both from the administration perspective and the Congress perspective.”

Canberra’s concerns are said to focus on U.S. regulations aimed at protecting defense technology.

Australian officials have been pushing their U.S. counterparts behind the scenes for reforms of how they’re treated under the U.S. International Trade and Arms Regulations, or ITAR, for many years but the Biden administration has yet to take on the complex issue.

“It’s incredibly complicated for the interagency so the Australians are pushing hard for it,” said Josh Kirshner, a former State Department defense trade official, now with Beacon Global Strategies. “It’s a very technical issue but as technology becomes the coin of the realm, the whole national security world has to be versed in it.”

A group of former U.S. diplomats wrote this week that restrictions on trade with Australia under ITAR undermines AUKUS and U.S. national security overall. The lead author, James Carouso, who is a former adviser to U.S. Indo-Pacific Command, was joined by four former U.S. ambassadors to Australia.

“U.S. law and bureaucracy creates months of delays to service U.S.-made helicopters, prevent the repair of U.S. naval fighter aircraft, and even transfer bolts for U.S.-made aircraft flown by the Australian military,” their essay reads. “The United States needs to be thinking and acting now with the sense of urgency demanded by the rapidly deteriorating and extremely difficult threat environment.”

Congress is expected to pass legislation this week to aid implementation of AUKUS. The compromise 2023 National Defense Authorization Act includes language to permit Australian officers to participate in training programs for U.S. Navy officers assigned to nuclear-powered submarines.

The British announced a similar move earlier this year.

A related provision orders a federally-funded study of the implementation challenges for AUKUS, in the realms of personnel shortfalls, information-sharing, laws and regulations, export controls, intellectual property and security protocols.

The study, due in by 2024, would also cover ways to accelerate Australia’s national security posture, including interim submarine options and the potential conveyance of B-21 bombers.

Joe Gould was the senior Pentagon reporter for Defense News, covering the intersection of national security policy, politics and the defense industry. He had previously served as Congress reporter.

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