Australia should consider establishing a dedicated centre for advancing breakthrough technologies, akin to the United States Defense Advanced Research Projects Agency (DARPA). An Australian Advanced Research Projects Agency (AARPA) would ensure the nation remains competitive in critical areas such as artificial intelligence (AI), quantum computing, and biotechnology, particularly in the context of Indo-Pacific dynamics.
China‘s strategic approach underscores the transformative power of state-led initiatives in fostering high-risk, high-reward technological innovation. The Chinese government has allocated substantial funding to dominate these fields, with more than USD 15 billion for quantum computing, USD 220 billion for biotechnology, and USD 184 billion for AI, guided by its meticulous five-year plans. This deliberate investment reflects China’s ambition to lead in these cutting-edge domains.
Recognizing the strategic importance of such advancements, other nations have already taken steps to emulate the DARPA model. In 2023, the United Kingdom established the Advanced Research and Invention Agency (ARIA). An Australian version would add to the existing AUKUS programs, making a three-way base for working together on breakthrough technologies under the second pillar of the agreement.
In December, the Australian government initiated a review of its research and development (R&D) framework. If the government is serious about strengthening its role within AUKUS and contributing to Indo-Pacific security, it must make significant reforms to its research funding structures.
The Case for Increased Investment in Australian Research
Australia has demonstrated significant potential in global research but continues to underinvest in science and innovation. Government R&D spending has been stagnant at less than 0.2% of GDP for years, while total R&D expenditure—including the private sector—is only 1.68% of GDP. This is well below the Organisation for Economic Co-operation and Development (OECD) average of 2.7% and far behind China’s 2.4% and the United States’ 3.5%.
Despite these limitations, Australia outperforms major countries like the United States, the United Kingdom, and China in the number of academic papers published per capita. This highlights the untapped potential that could be unlocked through greater investment in research and development. With proper funding, Australia could generate a significantly higher volume of impactful innovations.
Strategic Imperatives for Sovereign Capability
Australia’s reliance on mineral exports to China is unsustainable and poses long-term risks to national security and sovereignty. In a world that increasingly prioritizes onshore advanced manufacturing, building sovereign capabilities in critical technologies is essential. An AARPA could play a pivotal role in achieving these goals.
The Chinese Communist Party’s ambitions, as outlined in its five-year plan through 2025, focus on becoming the global leader in AI, biotechnology, and quantum computing. These technologies are converging at an unprecedented pace, enabling rapid advancements in fields such as drug development through AI. However, they also present dual-use risks, including the potential for advanced bioweapons. The BGI Group, a Chinese company with ties to the military, has raised concerns due to its extensive genetic data collection during the COVID-19 pandemic. This led to restrictions on its operations in the United States over national security concerns.
In response to such risks, the United States has established the National Security Commission on Emerging Biotechnology. Its inaugural report highlighted the transformative potential of AI, quantum computing, and biotechnology for security and underscored the need for Western democracies to maintain a technological edge while reducing dependency on Chinese supply chains.
Lessons from DARPA and the Path Forward
Australia’s current research funding model is inadequate. Success rates for government grants have fallen below 20%, a trend that risks driving talented researchers abroad. This brain drain could severely impact the nation’s ability to innovate.
DARPA offers a proven framework for addressing these challenges. For decades, it has led the world in funding transformative technologies, including GPS, the internet, drones, and mRNA vaccines. Its structure relies on sector-specific experts who serve as program managers with the autonomy to design and oversee high-risk, high-reward projects. This approach enables rapid responses to emerging trends and fosters innovation that might otherwise go unsupported.
Ensuring Technological Leadership
The 21st century will be defined by the integration of AI, quantum computing, and biotechnology. These technologies carry profound national security implications and will reshape global risks in unpredictable ways. Australia is already a hub for innovation in these areas, with researchers capable of delivering groundbreaking projects swiftly. Establishing an AARPA would not only secure Australia’s position in a competitive global landscape but also bolster its contributions to Indo-Pacific security and technological collaboration.
