Overview of strategic importance
1.1
Christmas Island and the Cocos (Keeling) Islands (an archipelago with population centres in Home Island and West Island) are located strategically in the Indian Ocean and are much closer to Asia than they are to mainland Australia. Christmas Island is 2,650 kilometres northwest of Perth and 494 kilometres south of Jakarta, Indonesia—Australia’s largest neighbour and an important strategic partner. The Cocos Islands are located 2,950 km northwest of Perth and 1,274 km west-southwest of Jakarta. Singapore is just 1,680 kilometres from the Cocos Islands.
1.2
The Indian Ocean Territories are a part of Australia’s interests in the Indian Ocean and Indo-Pacific region. This is increasingly important because the region can be described as a ‘dynamic strategic theatre’. In addition to being a crucial conduit for Australian and global trade, and host to some of the fastest growing economies and populations, there is growing strategic competition in the region, particularly between China and India.
1.3
Australia’s Indian Ocean Territories are close to significant geographical features, including the Malacca, Sunda and Lombok Straits and vital sea lanes, including primary export routes between Western Australia and North and East Asia. Maritime threats originating from Southwest and Southeast Asia, including illegal fishing, people smuggling and other forms of transnational crime all rely on sea routes that pass near Christmas Island and the Cocos Islands.
1.4
Despite their relatively small size, the island territories have full maritime entitlements under the United Nations Convention on the Law of the Sea; that is, a 12 nautical mile Territorial Sea and 200 mile exclusive economic zone. Australia’s rights extend to the airspace above and resources in the seabed below this area.
Referral of the inquiry
1.5
On 10 November 2016 the Joint Standing Committee on the National Capital and External Territories (the Committee) agreed to inquire into and report on the strategic importance of the Indian Ocean Territories (Christmas Island and the Cocos Islands) in accordance with the terms of reference referred by Senator the Hon. Fiona Nash, Minister for Local Government and Territories. The Committee was asked to focus on:
the changing regional security environment and security contingencies;
defence capability in the territories and associated infrastructure development;
the scope of maritime, air and other cooperation with Indo-Pacific partners; and
impacts on local communities.
Scope of the inquiry
1.6
This inquiry is a departure from some of the previous inquiries the Committee has undertaken into the Indian Ocean Territories, namely into governance, administrative arrangements, infrastructure, and economic development. The present inquiry does not seek to replace the good work done by the current Committee’s predecessor, and the Committee endorses the previous findings. Instead, the current Committee aims to build on previous conclusions and recommendations and consider the Indian Ocean Territories from a more strategic perspective.
1.7
The previous Committee tabled its comprehensive report into governance matters in March 2016 and the Australian Government provided a response to that report in March 2017. While there is some overlap between that inquiry and the present inquiry—particularly in relation to the need for enhanced community consultation, improved service delivery arrangements, and development of the tourism industry—the present report will consider these areas again only insofar as they are relevant to the current inquiry.
1.8
It is worth restating that the governance and administrative arrangements in the Indian Ocean territories are unique. Namely, that the Australian Government, through the Department of Infrastructure and Regional Development, is responsible for managing Commonwealth infrastructure assets and the delivery of state-type services to residents. This includes port, airport, air-service and water contracts with the private sector, service delivery arrangements with the Western Australian Government, and directly by federal government officials and the locally-based Indian Ocean Territory Administration. The Shires of Christmas Island and the Cocos Islands provide additional local government services.
1.9
The 2016 Committee report summarised the various views about the governance and administrative arrangements in the Indian Ocean Territories, ranging from unclear delineations of responsibility and layers of bureaucracy, to inadequate community consultation. That report also made clear that the Committee recognised the challenging situation that the Department of Infrastructure and Regional Development finds itself in trying to deliver on all fronts—managing strategic and policy direction in Canberra, running schools, hospitals and utilities on the ground in a remote location, and being responsible for asset management, all with limited resources.
1.10
The 2016 Committee report explored the reasons why it has been and is difficult to grow tourism. Despite some real difficulties, there remains potential for development. The Indian Ocean Territories have extraordinary natural offerings, including national parks with rich flora and fauna, Christmas Island’s red crab population and annual migration, and the Cocos Islands’ pristine coral atolls and diverse sea life. These assets contribute significantly to the territories’ value.
1.11
The same could be said of the unique resident population mixes on the Cocos Islands and Christmas Island. The population figures have fluctuated over the years, particularly on Christmas Island, but generation after generation of communities on Christmas Island and the Cocos Islands continue to want to live in these special places.
1.12
Given the changing nature of the region, its strategic importance to Australia’s defence, and the importance of ensuring the evolving needs of local communities can be adequately assessed, this Committee’s review into Australia’s relationship with the Indian Ocean Territories is timely.
Conduct of the inquiry
1.13
The inquiry was advertised by media release and on the Committee’s website on 17 November 2016. Submissions were invited from individuals and organisations addressing the terms of reference, initially by 20 January 2017, but extended on a rolling basis through May 2017.
1.14
The Committee also advertised the inquiry in the Indian Ocean Territories Administration Community Bulletin (A31/2016) on 17 November 2016, and the two local newsletters, The Islander and The Atoll, on Christmas Island and the Cocos Islands respectively. Further notices were placed in these same publications in March 2017, ahead of the Committee’s visit in April 2017. The notices were advertised in English, Chinese and Malaysian for Christmas Island, and English and Cocos Malay for the Cocos Islands.
1.15
The Committee received 17 submissions and 3 exhibits. A list of submissions and exhibits is at Appendix A.
1.16
The Committee held five public roundtable-style hearings, two in Canberra and three in the Indian Ocean Territories. The Canberra hearings involved senior government departmental officials, subject matter experts and academics, and focused on the first three terms of reference. The hearings on Christmas Island and the Cocos Islands focused on the fourth term of reference—the local impacts—and included opportunities for community statements. The hearings and witnesses are listed at Appendix B.
1.17
The Committee also received private briefings from the Department of Infrastructure and Regional Development and the Department of Defence.
Committee visit to the Indian Ocean territories
1.18
The Committee visited Christmas Island from 3 to 4 April 2017 and the Cocos Islands from 4 to 6 April 2017.
1.19
In addition to the public hearings and community statement sessions, the Committee undertook extensive inspections of Commonwealth infrastructure and assets.
1.20
On Christmas Island the visit program included the airport, port and crane, the Australian Federal Police Response Centre, contingency detention centre facilities, health services, communications tower, power service, and fuel tank farm. The Committee met with members of the Christmas Island Inter-agency Coordination Committee comprising representatives from the Islands major stakeholders (the Administrator and Indian Ocean Territories Administration, Indian Ocean Territories Health Service, Shire of Christmas Island, Australian Federal Police, Australian Border Force, Department of Agriculture, Australian Navy, Parks Australia, Serco and the Indian Ocean Territories Regional Development Organisation). The Committee also toured the disused Christmas Island Casino Resort and visited teachers and students at an after-school program at the Christmas Island mosque.
1.21
On the Cocos Islands the Committee similarly inspected Commonwealth infrastructure and assets on West Island and Home Island, visiting the port facility, health service and school as well as the former quarantine facility, housing, light industrial area, waste management transfer station and erosion control measures.
1.22
The Committee met with members of the Regional Development Organisation on West Island and had an opportunity for informal discussions with Shire Councillors on Home Island during an evening reception hosted by the Committee.
1.23
On both Christmas Island and the Cocos Islands the Committee hosted morning and afternoon teas to meet with the local communities.
1.24
The Committee was pleased to be able to participate in self-determination day celebrations with the local community on Home Island on the morning of 6 April 2017.
Report structure
1.25
The remainder of this report consists of four chapters that deal with each of the inquiry terms of reference in turn. Chapter 2 focuses on the changing regional security environment and contingencies, chapter 3 on regional partnerships, chapter 4 looks at defence capability and associated infrastructure development in the Indian Ocean Territories, and chapter 5 examines the impacts of all of the above on the local communities.