Indian Council of World Affairs

Recently Australia announced its new ‘National Defence Strategy (NDS) 2026’, in April 2026, following a hiatus of two years. Canberra had launched its first NDS in 2024 with plans to release subsequent strategies biennially, so as to evaluate the strategic environment for the country and lay out the policy thinking accordingly. Along with the NDS, the Australian Department of Defence also announced ‘2026 Integrated Investment Programme’ (IIP), aimed at supporting efforts to deliver the NDS 2026. These documents along with NDS 2024 and Defence Strategic Review (DSR) 2023 reflect a change in the way Canberra perceives its strategic setting and considers the need to review its defence and strategic preparedness in the face of a more competitive and unpredictable Indo-Pacific region. 

Shift in Australia’s Strategic Posture and Key Takeaways of NDS 2026

In the recent years, Australia’s defence and strategic posture has undergone shifts, as the country now focuses on a more forward-leaning, deterrence-oriented strategy. This reflects Canberra’s concerns about the geopolitical shifts in the larger Indo-Pacific region and also a desire to play an active role in shaping the regional order. With the DSR 2023, Australia highlighted the need for “ambitious but necessary reforms”, to its defence posture, structure, and preparedness.[1] The DSR also included a recommendation for Australia to have national defence strategy encompassing “a comprehensive plan of defence policy, planning, capabilities and resourcing”.[2] The recent release of NDS is a continuation of policy efforts by the Australian Government in that direction.

The latest NDS of Australia highlights that, global order is characterised by “more overt struggle among states where thresholds against the use of force are being eroded”[3]. It emphasises that the world is likely to undergo more ‘fracture, rivalry and disorder’ in the coming years. The intense competition between the US and China will continue and the flashpoints in the Taiwan Strait, the South and East China Seas and on the Korean Peninsula, could result in a larger conflict. The war in Ukraine and conflicts in the Middle East, have implications for the wider Indo-Pacific. Given the seismic geopolitical developments in the region, the Strategy notes that there has been an increasing surge in military spending by countries across the world. It also emphasises that the current strategic environment means an increased level of the risk to Australia’s security and prosperity in the coming years. The Strategy introduces a concept of ‘National Defence’, which stands for a ‘whole of government’ and ‘whole of nation’ approach, to deal with strategic challenges Australia faces, including the ‘threat of conflict and the prospect of coercion’, to protect Australia’s security and interest.[4]

Reflecting pragmatism in the face of a fractured global order, Canberra as a middle player, is strategically hedging in an unpredictable security environment to reduce over-reliance on traditional multilateralism and bilateral alliances. Canberra has been leveraging a number of minilateral platforms in the Indo-Pacific, as a core pillar of its foreign and security policy. The launch of AUKUS in 2021, with plans to acquire nuclear-powered submarines under the pact, was a crucial development for the country. According to the latest reports, under AUKUS, Australia is planning to buy three second-hand Virginia-class submarines from the US.[5]

It is important to note that NDS 2026 emphasises the need for Australia to have greater self-reliance in the long term, and take greater responsibility for its security. Australia is also looking forward to developing a highly skilled defence workforce with long-range strike capabilities, and adapting new and disruptive technologies into its defence capabilities.[6] The plan is to acquire an integrated and focused force, building capabilities in areas including, undersea warfare, amphibious capable combined-arms land systems, sea denial and sea-control capabilities, long-range strike capabilities, expeditionary air operations, building resilient space and cyber capabilities, missile defence, and others.[7] There’s a strong bipartisan view in Canberra that the country needs to invest more in its defence forces. According to the latest IIP, the Australian government is planning to increase defence investment by an additional $14 billion over the next four years and $53 billion over the next 10 years. Therefore, the total defence funding is expected to increase around 3.0 percent of the country’s GDP by 2033-34.[8]

While the NDS emphasises on building its own capacities for Australia, it nonetheless reiterates that the US continues to remain the most important ally for Australia, and an effective balance of power in the Indo-Pacific requires the continued presence of the US. However, it also notes that the US “increasingly expects its allies and partners to invest more in their own defences, reduce their reliance on the US military and contribute more to collective defence”.[9] Therefore, to sustain deterrence in the face of potential US retrenchment, Australia recently has been focusing on improving the country’s deterrence capabilities.

Under the Albanese administration, Australia is actively diversifying its relationships, focusing on reducing its economic dependence on China and broadening its security cooperation beyond its traditional alliance with the US. Canberra is focused on furthering closer ties with other partners in Indo-Pacific, including India, Japan, South Korea and ASEAN countries. As the NDS notes “Australia will also work with partners and allies to enhance collective deterrence to contribute to regional security and stability in the Indo-Pacific”.

On China, the new NDS once again raises concerns about it’s extensive military build-up without transparency and also warns that China’s “coercive statecraft and grey-zone operations”, raises the risk of escalation in the region. However, at the same time, the Strategy also mentions that maintaining a constructive relationship with China is in the interest of both countries. Under the current administration, Australia has made efforts, to mend ties with China. Prime Minister Albanese has undertaken a visit to Beijing in both of his terms, as the government in Australia tries to delicately balance its relationships with China and the US.  

The Strategy mentions India as a “top-tier security partner for Australia and our most important defence partner in the Northeast Indian Ocean” and supports a key role for India in the Indian Ocean region. India-Australia ties have been on an upswing in recent years, with a robust partnership in all spheres including defence. Recently the Australian Foreign Minister Penny Wong was in India for the Quad Foreign Ministers’ Meeting in New Delhi on 26 May 2026, and also to participate in the 17th India–Australia Foreign Ministers’ Framework Dialogue (FMFD). Australian Defence Minister Richard Marles also visited India in June 2026, to participate in the Second Australia-India Defence Ministers' Dialogue on 1 June 2026, to discuss overall defence and security cooperation between the two countries and ways to enhance it further. At present, India and Australia also share greater strategic alignment, with their commitment to a transparent, open, secure, inclusive, and rules-based order in the Indo-Pacific.

In addition, the Strategy mentions that Australia will continue to enhance its engagement with other key allies and partners including New Zealand, Japan and Singapore.

Without naming any particular country, the NDS, raises concerns about espionage and foreign interference, posing intensifying threats to Australia’s security and sovereignty. Australia has earlier also spoken about it on many occasions as a serious threat to its national security. It states that “authoritarian regimes and hostile nations are becoming more willing and able to disrupt critical infrastructure, particularly the seabed infrastructure to conduct cyber intrusions and engage in misinformation and disinformation campaigns”.[10]

The strategy also highlights other challenges including grey-zone activities in the Indo-Pacific, risk of nuclear escalation, transnational crimes, climate change, and conditions for unrest and state fragility, as the factors that result in a more challenging security environment and the need for the countries to reassess their defence and security capabilities.

Given the backdrop of rapid shifts in the global geo-political and geo-economic environment in recent years, Australia's strategic posture has evolved from a focus on defence to a broader approach centred on deterrence and regional security. An important role here has also been played by the political continuity that the country has experienced after a long time, given Prime Minister Anthony Albanese’s re-election in May 2025 for a second term in office. Albanese has become the first Prime Minister of Australia, after more than two decades, to win a second consecutive term. This has enabled the Labor Party administration to focus with the consistency and authority required to implement significant doctrinal changes, to pursue comprehensive defence reforms and modernisation.

Conclusion

Australia’s NDS 2026, highlights that the world at present is more dangerous and unpredictable, as the global rules-based order is in transition. Through the latest NDS, Australia has announced an overhaul in its defence spending and preparedness, to deter potential adversaries. The strategy places deterrence at the centre of Australia’s defence planning, and at the same time emphasises on working with allies and partners to maintain stability and a rules-based order in the Indo-Pacific. Therefore, the NDS presents a mature strategic posture for Australia that acknowledges the need to take proactive responsibility for its own defence and to contribute to regional peace and security in the Indo-Pacific.  

*****

*Dr. Pragya Pandey, Research Fellow, Indian Council of World Affairs, New Delhi.
Disclaimer: The views expressed are personal.

End Notes

[1] Release of the Defence Strategic Review, 24 April 2023,

https://www.minister.defence.gov.au/media-releases/2023-04-24/release-defence-strategic-review

[2] I.bid.

[3] Australian Government, Department of Defence, National Defence Strategy 2026, p. no 6 https://www.defence.gov.au/about/strategic-planning/2026-national-defence-strategy-2026-integrated-investment-program

[4] I. bid, p.19,

[5] Defence Minister says Australia could still buy five US submarines under AUKUS, June1, 2026, https://www.abc.net.au/news/2026-06-01/richard-marles-says-aukus-deal-unchanged-submarine-buy/106743696

[6] Australian Government, Department of Defence, Defence Strategic Review 2023, https://www.defence.gov.au/about/reviews-inquiries/defence-strategic-review

[7] I.bid.

[8] 2026 Integrated Investment Program, https://www.defence.gov.au/about/strategic-planning/2026-national-defence-strategy-2026-integrated-investment-program

[9] I.bid. no.4, p.13

[10] I.bid. no.4, p.14