Australian Army soldiers on parade at Darwins Robertson Barracks.

"The strategic shift in our region ... has continued" ... Julia Gillard. Photo: Glenn Campbell

AUSTRALIA will significantly upgrade its military presence in the north and north-west of the country to confront the strategic challenges expected to be posed by the growth of India and China during the so-called Asia Pacific century.

Plans include upgrading bases and other facilities near commercial centres such as Cairns, Darwin and Broome.

The plans are the result of the Defence Force's posture review, by the former Defence Department secretaries Ric Smith and Allan Hawke, which was released yesterday.

''The strategic shift in our region … has continued as global weight has moved to our region of the world,'' the Prime Minister, Julia Gillard, said.

Mr Smith and Dr Hawke found ''significant weaknesses and risks'' in the military's posture and said such issues would become even more acute in the coming decades as India and China increasingly exert power in the region.

The military modernisation and growth of those two powers would likely involve the development and proliferation of missiles, cruise missiles, submarines, strike aircraft, and electronic warfare systems, the pair write.

''This has implications for Australia's ability to maintain a capability edge and for the potential vulnerability of bases and logistics in the event of conflict,'' they say.

The report also calls for an increased focus on Australia's two major fleet bases, particularly HMAS Sterling in Western Australia, and upgrading a number of air force bases to allow high-tech aircraft to use them.

The strategic repositioning was also needed to protect Australia's resources in the north, and to provide a higher visibility in the area.

The pair also recommended upgrading a military airstrip in the Cocos Islands to allow drone and other surveillance aircraft to operate there, given its strategic location close to south-east Asia.

They also chastised the navy for lacking an overarching plan to confront the challenges to be presented in coming decades: ''Defence should develop a more comprehensive long-term master plan for meeting navy's Force 2030 basing requirements, which also addresses the implications of increased US activities and presence in Australia.''

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