The Turnbull Government will establish a $3.8 billion fund that will offer loans to local arms manufacturers in a bid to boost Australia's defence export industry.
Defence industry minister Christopher Pyne said it was "very realistic" for Australia to join the ranks of the world's 10 largest exporters of arms because the government was "putting the heft behind it", speaking with ABC Radio on Monday morning.
The government's push on arms sales will also see a special exports division created within the Department of Defence, Mr Pyne confirmed.
He said the plan could create "tens of thousands" of jobs for Australian manufacturers.
The loans program, named the Defence Export Facility, will aim to help companies access overseas markets.
Australia currently is ranked 20th in arms exports with a 0.3 percent share of the global market, according to a widely-cited 2017 report from the Stockholm International Peace Research Institute.
The Coalition wants Australia to enter the top 10. Israel is currently ranked tenth with 2.3 percent of the market.
Head of the World Vision charity Tim Costello has previously denounced the government's arms export drive as "exporting death and profiting from bloodshed".
But foreign minister Julie Bishop said Australia would base its decisions on who to tell weapons to on "strategic concerns". She said the country was bound by various international treaties and would negotiate sales on a "case by case" basis.
Defence Industry Minister Christopher Pyne says Australia already exports a substantial amount - such as the Bushmaster armoured vehicles, parts for the new Joint Strike Fighter planes and life rafts for ships - but there is potential to create thousands more jobs if this is boosted.
Australia had a high reputation for quality and capability, but needed to turn that into sales of products and services.
"There's a veritable welter of products, but we haven't really taken it to the next level, which is to seriously compete in the world for (a part of) what is a $1.5 trillion part of the world economy," Mr Pyne said.
"I think we have every chance of success."
As well as expanding the Export Finance Investment Corporation's remit with the new $3.8 billion loan facility, the government will spend $80 million over four years on a grants program to support small and medium businesses who want to export, another program to help local companies build export capacity, and a focus on trade shows and long-term campaigns.
Priority markets for Australian arms include the US, Canada, the UK, New Zealand, the Middle East and the Indo-Pacific.
Trade Minister Steve Ciobo says Australia will also look at opportunities in Japan.
"What we are looking for are countries where we have got a strong human rights track record and, of course, have safeguards in place," he told the Nine Network.
- with AAP
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