Cocos Islands (Keeling islands), located 1,703 kilometres from Singapore and 1,296 kilometres from Jakarta and the adjacent SLOCs, is administered by the Australian federal government’s Department of Infrastructure, Transport, Regional Development and Communications as an Australian external territory and together with Christmas Island (which is about 960 kilometres to the east) forms the Australian Indian Ocean Territories administrative grouping. It is not to be confused with Myanmar’s Coco islands, which are close to India’s Andaman and Nicobar Islands and a Tatmadaw base and suspected Chinese military installation in the Indian Ocean. The Australian Cocos Islands is a pressure point to all three straits (Malacca, Sunda and Lumbak) and will be decisive to countering Chinese spy submarines in the Indian Ocean.

Australia is set to start co-manufacturing guided weapons with the United States next year, aiming to bolster supply for allies in the Indo-Pacific and increase the U.S. military presence in the country, including bomber aircraft. This announcement came after the annual AUSMIN defense talks between the two nations.

The territory consists of two atolls made up of 27 coral islands, of which only two – West Island and Home Island – are inhabited. The population of around 600 people consists mainly of Cocos Malays, who mostly practise Sunni Islam and speak a dialect of Malay as their first language.

The two countries are already collaborating to upgrade air bases in northern and western Australia, strategically located closer to potential conflict zones like the South China Sea than Canberra. Following the talks in Annapolis, Maryland, U.S. Defense Secretary Lloyd Austin stated that the presence of rotational U.S. forces in Australia would increase. This includes more maritime patrol and reconnaissance aircraft operating from bases across northern Australia, along with more frequent rotational bomber deployments.

Austin highlighted shared security challenges, such as “coercive behavior” by China, during his remarks. Japan would increase exercises with U.S. Marines in Darwin, while Australia and the U.S. would hold regular exercises in the Philippines exclusive economic zone, the statement said as reported by Reuters. The joint statement from the talks also noted Australia’s strategic Indian Ocean territory, the Cocos Islands, for the first time.

The U.S. expressed support for Australia’s planned infrastructure upgrades there, which are crucial for maritime surveillance operations amid China’s increasing submarine activity in the Indian Ocean.

Australia plans to start expanding the airfield on the Cocos Islands this year to accommodate heavier military aircraft, such as the submarine-hunting P-8A Poseidon. The Cocos Islands, located 3,000 kilometers west of the Australian mainland, are key to Australia’s defense strategy in the region.

Justin Bassi, executive director of the Australian Strategic Policy Institute, emphasized the importance of the joint statement’s “clarity on the threat from Beijing and support for the Philippines” as vital for Manila.

Additionally, the Cocos Islands are among several sites in the region earmarked for U.S.-funded construction and refurbishments as part of the Pacific Deterrence Initiative. This initiative, established by Congress in 2021, aims to maintain the U.S. military advantage over China by modernizing and strengthening its presence in the Indo-Pacific. The planned projects include new facilities, repairs, and infrastructure upgrades across the Cocos Islands, the Philippines, Timor-Leste, and Papua New Guinea, with funding potentially reaching $15 billion.

Upgrades to the Cocos Islands’ facilities will enable operations by P-8 Poseidon reconnaissance planes, E-7 Wedgetail early warning aircraft, and aerial refuelers. The Australian air force’s MQ-28 Ghost Bat multirole aircraft is also expected to begin operations there within two years. Although the Cocos Islands offer strategic advantages, their remote location and limited infrastructure pose challenges for large-scale operations.