By Lewis Jackson and Sakura Murakami
SYDNEY/TOKYO (Reuters) -Australia downplayed reports Japan could soon join its AUKUS security pact with Britain and the United States, saying on Tuesday any cooperation would be on a project-by-project basis as differences emerge within the pact over adding new members.
Prime Minister Anthony Albanese praised Japan as a close partner but said there were no plans to add a fourth member to the pact at a news conference called hours after the AUKUS defence ministers announced they would consider working with Japan on military technology projects.
"What is proposed is to look at 'pillar two' of AUKUS and look at a project-by-project, whether there would be engagement, and Japan is a natural candidate for that to occur," Albanese said.
"What is not proposed is to expand the membership of AUKUS."
Defence Minister Richard Marles reiterated the AUKUS partners could potentially work with Japan on specific technology projects but it would not join the pact.
AUKUS, formed by the three countries in 2021, is part of efforts to push back against China's growing power in the Indo-Pacific region.
The first stage, or "pillar", aims to deliver nuclear-powered attack submarines to Australia. The second pillar is focused on sharing military technology and cooperation in areas including quantum computing, artificial intelligence and cyber technology.
While the U.S. has previously raised the possibility of involving other nations, including Japan and New Zealand, expanding the pact faces hurdles from strict U.S. restrictions on sharing technology and hesitation in other capitals.
Canberra worries adding a fourth country to the alliance would complicate and take attention away from the already difficult task of acquiring nuclear-powered submarines, according to a diplomatic source.
A Japanese government official told Reuters on Monday discussions about formally joining the alliance would likely not be welcomed by Australia or Britain until they had concrete results from the pact.
"Talking about increasing the number of members when nothing’s been achieved with AUKUS yet would only disrupt the framework of cooperation that is meant to be its basis," said the official, who agreed to speak on condition of anonymity.
Even in the absence of political obstacles, officials and experts say Japan needs to introduce better cyber defences and stricter rules for guarding secrets before it can be incorporated in the pact.
A summit in Washington between U.S. President Joe Biden and Japanese Prime Minister Fumio Kishida on Wednesday is expected to address Japan's possible future involvement in pillar two projects.
China has criticised the pact and said it could spark a regional arms race. A foreign ministry spokesperson said on Monday expanding AUKUS would destabilise the region and Japan should act cautiously on defence issues given its history.
U.S. Deputy Secretary of State Kurt Campbell, a key architect of U.S. Indo-Pacific policy and a proponent of wider involvement in Pillar II of AUKUS, said last week the U.S. was encouraging Japan to do more to protect intellectual property and hold officials accountable for secrets.
"It's fair to say that Japan has taken some of those steps, but not all of them," Campbell said.