Mumbai: Australia proposes to radically improve its ties with India in an new strategetic initiative that includes active diplomatic support for New Delhi's bid for a permanent seat in an expanded UN Security Council and a negotiated free trade agreement.

The Australian cabinet has endorsed a slew of strategic measures proposed by foreign minister Alexander Downer designed to elevate India to a level on a par with the US, Japan, China and Indonesia, The Australian reported.

Apart from allowing the export of uranium – approval for which was announced last week by Howard – the recommendations include formal and active diplomatic support for India's bid to become a permanent member of the UN Security Council. (See: Australia to sell uranium with safegaurds to India)

The proposals are based on the obvious synergy in energy trade, the familiar common-law system in India that could facilitate a free trade agreement (FTA) and the opportunities that would offer to Australian companies in the services sector, the daily said.

The growing warmth of the Australian government is also recognition of India's economic success and its growing importance to Australia, given its growing strategic power.

It also notes India's increased engagement with East Asia and the Pacific and Australia's rapidly growing trade ties.

Canberra also plans to continue its engagement in the quadrilateral talks involving the US, Japan and India, despite Chinese opposition.