Australia, the UK and the US early on Thursday launched a trilateral security partnership called AUKUS.
The alliance will involve the three nations working together on areas such as artificial intelligence and long-range strike capabilities and the US and UK sharing technology with Australia to build a fleet of nuclear-powered submarines. The Royal Australian Navy has, to date, only operated conventional diesel-electric submarines.
The alliance is being seen as a response to growing Chinese forays into the Indo-Pacific region.
However, one western nation has responded angrily to the announcement: France. While France has been among the nations that have stepped up military deployments to the Indo-Pacific to counter China, Paris had also signed a massive contract to supply the Royal Australian Navy a fleet of 12 cutting-edge diesel-electric submarines. This deal has been invalidated with the announcement of AUKUS.
In 2016, the government of Malcolm Turnbull selected French state-owned company DCNS (now known as Naval Group) to build 12 submarines for the Royal Australian Navy at an estimated cost of US $40 billion. The French company had offered the Royal Australian Navy a new class of submarine called the Shortfin Barracuda, that was derived from the French Navy's new class of nuclear-powered submarines. The contract was one of the largest military export deals at the time.
The Shortfin Barracuda project was christened the 'Attack' class submarine programme in the Royal Australian Navy. All the ships were to be built at the Osborne Naval Shipyard in South Australia.
The Attack class submarines were intended to be among the most advanced conventional submarines in the world, meant for long-range missions and featuring weapons for anti-ship, anti-submarine and land-attack missions.
In a statement issued on Thursday, Naval Group had described the Australian decision as a "major disappointment". The statement said "Naval Group was also offering Australia a sovereign submarine capability making unrivalled commitments in terms of technology transfer, jobs and local content. For five years, Naval Group teams, both in France and in Australia, as well as our partners, have given their best and Naval Group has delivered on all its commitments."
French Minister Of Europe and Foreign Affairs Jean-yves Le Drian and Minister of the Armed Forces Florence Parly issued a statement, expressing disappointment at the fact France was excluded from the partnership. "The American choice to exclude a European ally and partner such as France from a structuring partnership with Australia, at a time when we are facing unprecedented challenges in the Indo-Pacific region, whether in terms of our values or in terms of respect for multilateralism based on the rule of law, shows a lack of coherence that France can only note and regret."
The statement referred to the Future Submarine Programme (FSP), the name given to the Attack submarine project in French-Australian communications. "The regrettable decision that has just been announced regarding the FSP program only reinforces the need to make the issue of European strategic autonomy loud and clear... There is no other credible way to defend our interests and our values in the world, including in the Indo-Pacific."
History of delay
Despite the French protests, there had been indications of problems with the Attack submarine project for several years now. Australian media reports have indicated there were concerns in Canberra about extent of workshare given to Australian companies by Naval Group and delivery timelines and costs.
In January, media reports indicated the cost of the Attack submarine project had risen from Australian dollar 50 billion to nearly Australian dollar 89 billion (US $65 billion). While the first submarines were originally intended to enter service by the "early 2030s", in November 2018, vice admiral Michael Noonan, the chief of the Royal Australian Navy, admitted the first ship may not be operational until 2035.
The last submarine would have entered service by 2050, according to the delayed timeline. The delays had raised concern about the relevance of the new ships, particularly given the continuing growth of China's navy and also Beijing's development of unmanned underwater vessels.
Ever since news of delays in the submarine project surfaced, Australian politicians and analysts had called for Canberra to junk the deal and examine buying nuclear submarines from the US.
According to the US Congressional Research Service report on China's naval modernisation in September, as of 2020, China had 46 diesel-electric submarines, six nuclear-attack submarines and four nuclear submarines meant to carry nuclear-armed ballistic missiles. The Royal Australian Navy currently has a fleet of six 'Collins' class submarines that were inducted in the late 1990s and are based on a Swedish design. The delays in the Attack programme had led to calls to upgrade the Collins class submarines.