Australias escalating $1.6 billion AUKUS spend promises nuclear submarines but threatens to fuel division and arms racing across the Indo-Pacific, writesImran Khalid.

ON 25 AUGUST 2025, a Centre for Strategic and International Studies (CSIS)forumin Canberra reignited debate overAUKUS, with Australian officials reaffirming their$1.6 billioncommitment for 202526 to secure nuclear-powered submarines under the trilateral pact with the U.S. and UK.

Proponents argue that AUKUS strengthens deterrence against regional threats, but its expansion risks destabilising the Indo-Pacifics delicate balance. This pledge, part of an$8.8 billionmulti-year investment, coincides with diplomatic overtures to include Japan and New Zealand, raising concerns about an arms race in the Indo-Pacific.

In a region where ancient trade routes once fostered cultural exchange, this strategic recalibration threatens to unravel prospects for peace and cooperation.

The AUKUS framework, launched in 2021 to counter perceived threats, has evolved into a sprawling enterprise that risks inflaming tensions. The recentAustraliaUK treatyto co-develop up to 20 SSN-AUKUS submarines over the next five decades solidifies a long-term military commitment, whilePillar Twos focuson hypersonics, cyber capabilities and AI expands its scope.

Sky News assembling a cabinet of experts to talk about Australia's readiness for war is a problem we should be worried about.

Recent defence briefings confirm thatNew Zealandis actively engaging with Pillar Two, signalling a shift toward broader technological integration beyond traditional submarine platforms.

Yet, flaws are evident: U.S. and UK shipbuilding programs face delays and cost overruns, with a recent report raising doubts about the viability of the submarine deal due to industrial challenges. Australias$525 million paymentto the U.S. in July 2025, even as theTrumpAdministration reviews the pact, highlights a fiscal commitment that may outpace strategic prudence.

This review coincides with the passage of the bipartisanARMOR Acton 2 September 2025, which aims to streamline AUKUS-related arms sales and tech transfers, accelerating implementation despite lingering concerns. Within Australia, growing public and parliamentary concerns over AUKUSs escalating costs and alignment with national interests reveal a pact fraught with domestic contention.

Proponents frame AUKUS as a defensive necessity to uphold a rules-based order against Chinas growing influence, citing threats to maritime security and trade routes. This narrative, however, ignores a contradiction: transferring nuclear propulsion technology to a non-nuclear state like Australia undermines non-proliferation norms, potentially encouraging others to follow.

The environmental cost is equally troubling nuclear waste from these submarines will persist for millennia, with no clear disposal plan. Similarly, Chinas rapid infrastructure projects under theBelt and Road Initiativeface scrutiny for environmental impacts, underscoring the need for sustainable regional policies. Far from stabilising, AUKUS risks escalation, echoing past Western interventions that divided Asia.

Chinas response reflects a measured approach, though not without tensions. Beijing has consistently criticised AUKUS as a relic of Cold War thinking, arguing it underminesAssociation of Southeast Asian Nations(ASEAN)centralityand regional stability.

In July 2025, amid reports of strengthened military exports and infrastructure, China bolstered its defensive posture by deepening trade ties to counter pressures like potential U.S. tariffs. However, its intensified naval patrols in the South China Sea andTaiwan Strait, while signalling resolve, have raised concerns among ASEAN states wary of escalating maritime disputes.

As the U.S. expands its military footprint across Australia and the Pacific, peace advocates warn that were being dragged into a devastating war not of our making.

Diplomatically, Beijing prioritises frameworks like the Belt and Road Initiative, fostering economic interdependence across the Indo-Pacific, though questions persist about its transparency and debt implications, complementing ASEANs multilateral efforts.

The Indo-Pacific stands at a crossroads. Southeast Asian nations likeIndonesia and Malaysia, guided by initiatives like theASEAN Outlook on the Indo-Pacific, strive to preserve neutrality amid growing pressure to align with great-power blocs. ASEANs proactive diplomacy, such as Indonesias leadership in maritime security dialogues, can steer the region away from great-power rivalries.

Japan, cautiously supporting AUKUS while expanding economic ties with China, exemplifies the regions hedging. Australia itself grapples with contradictions, balancing AUKUS commitments with vital trade links to China, as seen in recent expos highlighting bilateral cooperation.

Yet, AUKUSs push to integrate Australian submarines into U.S.-led conflicts risks entangling Canberra in distant wars, alienating regional partners. Meanwhile, Pillar Twos narrowing focus on autonomous sea and air systems highlighted in recentLowy Instituteanalyses suggests a shift toward near-term operational capabilities that could further complicate regional security dynamics.

For Southeast Asia, the stakes could not be higher. ASEAN has long sought to preserve its centrality in regional affairs, resisting pressures to align exclusively with any single great power. The rise of AUKUS threatens to erode this delicate balance by drawing member states into security commitments that may not serve their national interests.

One path forward is for ASEAN, together with China, to strengthen existing platforms such as theASEAN Regional Forumand theEast Asia Summit. By deepening dialogue on maritime security and nuclear safeguards, the region can assert agency and prevent external pacts from dictating its security future.

For China, the challenge is to translate its economic weight into security reassurance while addressing regional concerns about its assertiveness. Beijings Belt and Road Initiative provides infrastructure and connectivity, though its environmental and geopolitical impacts remain debated.

Complementing this with enhanced regional defence dialogues and crisis-management mechanisms could help build trust, provided they prioritise transparency. Confidence-building measures such as joint maritime patrols with ASEAN partners or cooperative disaster relief exercises would reinforce the idea that security in the Indo-Pacific can be built collectively, in partnership with ASEAN-led frameworks, not imposed through external alliances.

Donald Trumps likely abandonment of the AUKUS contract offers the Albanese Government a welcome reprieve from a costly folly.

Singapores advocacy for inclusive security dialogues, as seen in theShangri-La Dialogue, offers a model for bridging AUKUS and ASEAN frameworks, fostering stability through multilateral engagement.

This escalation is not just strategic but ideological. AUKUS reflects Western efforts to preserve strategic influence, driven by concerns over Chinas growing power, echoing post-war security architectures that often overlooked regional voices. Its defenders in Washington and Canberra tout deterrence, citing threats to maritime security and trade routes, yet their actions risk fueling mistrust, pushing the region toward militarisation when climate crises and economic recovery demand collaboration.

Chinas approach emphasising dialogue and development through multilateral platforms offers one possible path, though its own maritime actions complicate regional trust.

The broader implications are stark. AUKUSs expansion, including potential new members, threatens to fracture ASEANs cohesion, forcing smaller states into an unwinnable alignment game. The U.S.s deepening defence industrial ties, extending beyond submarines to advanced technologies, signal a long-term commitment to containment, which responds to perceived threats but risks escalation.

Yet, as China reiterated its opposition during the Trumpreviewin August 2025, the pacts flaws logistical, ethical, and strategic become undeniable. AUKUS risks not just regional stability but the very order it claims to protect, inviting escalation where de-escalation is urgently needed.

In this pivotal moment, Chinas approach offers one perspective, emphasising connectivity over confrontation, though its territorial claims raise concerns. Beijing seeks to position itself as a steward of a multipolar Indo-Pacific. Its diplomatic engagements with Southeast Asia and beyond can support regional stability if paired with greater transparency, contrasting with AUKUSs focus on military-centric alliances, which respond to perceived threats but risk escalation.

History warns against such overreach empires that sought to dominate Asia through force left legacies of strife. AUKUS, with its nuclear ambitions and divisive rhetoric, risks repeating these missteps.

The Indo-Pacific deserves better. As climate challenges and economic interdependence call for unity, ASEANs vision of cooperative security, supported by inclusive dialogue, offers a lifeline. AUKUS, for all its bravado, may prove a fleeting gambit, its promises of security outweighed by the chaos it courts.

In these contested waters, restraint and dialogue, not submarines, will chart the course to lasting peace.

Imran Khalidis a geostrategic analyst and columnist on international affairs. His work has been widely published by prestigious international news organisations.

Related Articles

• Force Posture, no peace: Calls to cancel Australias U.S. military ties
• AUKUS collapse offers Australia the chance to navigate an innovative future
• AUKUS at a crossroads: Testing the trust in trilateralism
• Australian independence beckons as U.S. decays
• What's in store for Australia if we persist with AUKUS