05/29/2014 12:57 pm ET Updated Jul 29, 2014

Russia and Australia Should Forge a Pragmatic Relationship

On May 21, 2014, as reported by David Wroe in Sydney Morning Herald, Australian Foreign Minister Julie Bishop tightened sanctions against Russia. Wroe writes, "38 people would be subject to asset freezes and travel bans, bringing the total to 50. And for the first time, the sanctions will also be applied to 11 Russian companies," including SMP Bank, Bank Rossiya and the Volga Group. The sanctions aim to follow the United States and other Australian allies in their contention that Russia is intervening in Ukraine's internal affairs, and causing a breakup of the country following President Putin's annexation of Crimea.

While there is little doubt that Russia is intervening in Ukraine, the moral outrage being exhibited on the matter needs to be tempered with some broader perspective on what gets tolerated in the annals of Australian foreign policy. Ultimately, nation states make decisions on relations based on a balance of economic expediency and national security. Australia's ambivalent relationship with China is perhaps the most direct comparison in this regard. Marginalization of dissent, lack of democratic institutions and regional hegemonic tendencies are appropriately tolerated by Australia as well as many other Western nations because the broader importance of engaging with China trumps such matters. A similar modicum of care is in order when dealing with Russia.

Australia and Russia celebrated 70 years of diplomatic relations last year and this milestone year saw much reminiscence at the Department of Foreign Affairs and Trade with a major photographic exhibition. The cooperation between the two countries has taken on many facets from Antarctic exploration to Russian investment in Australia's mineral sector. Currently, there is a $1.7 billion bilateral trade relationship between Australia and Russia, with the single largest investment being the 20 percent ownership of Queensland Alumina by Russian firm Rusal (the world's largest aluminium company). Both countries have immense natural resources and vast geographic expanses of largely uninhabited land. They have much to gain from cooperating through epistemic exchanges, particularly research and educational partnerships. The Russian Far East even shares a time zone with Australia and has worked with the Asia-Pacific Space Centre in developing a spaceport launch site on Christmas Island.

As members of the G20, the relationship between the two nations is particularly important now since Australia's presidency of the group this year was handed over by the Russians as the preceding presiding country in 2013. It is thus particularly concerning that there is talk of somehow "banning" President Putin from attending the G20 summit in Brisbane. Such exclusionary actions within the G20 should be opposed by Australia and would signal some level of independence in foreign policy rather than just following every edict from Washington or London. Australia has shown some measure of independence on such matters in its relations with Iran (although they too remain fraught by American pressure on sanctions). For all his many dismissals of smaller states like Australia, President Putin made a gesture in 2007 to visit Australia on an extended visit for the APEC summit, making him the first serving Russian president to give the country a measure of diplomatic respect. During this visit the two countries also negotiated a historic agreement on Nuclear Partnership Agreement which came into force in 2010. At last year's APEC summit in Bali, the relationship between Australia and Russia appeared to show uneasy promise with initial reports of a Russian rebuke but with clear footage of Prime Minister Tony Abbott sharing a hearty laugh with President Putin. Barring Putin from the Brisbane summit would serve little purpose other than symbolic petulance that will only embolden hard-line Russian nationalism.

As for solidarity with Ukraine, there are many other ways to do so which would maintain Australia's positive relations with Russia and would be unlikely to alienate Western allies. Canberra should offer assistance to the government in Kiev and promote investment from Australian companies to boost the economy of the country. Australia could also provide natural gas contracts at preferred rates to the Ukranians in order to buffer them against any supply shortages due to deteriorating relations with Russia. Providing preferred scholarships to Ukranian students, helping them to gain expertise in developing their own mineral resources, would be another important contribution which Australia could make to constructively empower the beleaguered country. Genuine concern for ethnic minorities, whether Russians or Tartars should be the means by which Australia engages in principle on the Ukranian conflict which is more complex than a simple "invasion narrative."

The Abbott government has championed the concept of "economic diplomacy" in much of its foreign policy rhetoric. Given the geostrategic strength of Russia and the minimal leverage that Australia has by imposing sanctions and public rebukes, it may be opportune to give "economic diplomacy" a new connotation. Forging independent relations with Russia that are premised on common mineral fortunes and knowledge exchange will likely provide more opportunity for galvanizing positive change in the Kremlin.