Australia and India have talked for years about improving defence ties and the first joint naval exercise is finally about to happen.
Defence Minister Kevin Andrews said this first bilateral naval exercise, called Exercise AUSINDEX, would be held off India later this month.
Australia will contribute an Anzac frigate, oil tanker, Collins submarines and a Orion maritime surveillance aircraft, with some 400 personnel.
Mr Andrews, in India for talks with ministers and officials, told India's Institute for Defence Studies and Analyses in New Delhi that both nations bordered the Indian Ocean and had a shared interest in maintaining freedom of navigation and trade.
He said Australia viewed India as a key strategic partner and there was scope to co-operate further on broader global issues.
Despite close historic, cultural and sporting ties, the Australia-India security relationship has been marked by talk but not that much action. An Indian defence minister visited Australia for the first time in 2013.
That appears to be changing.
Mr Andrews said Exercise AUSINDEX marked a new and important stage in the defence relationship.
Potential for greater defence co-operation wasn't confined to navies, with both air forces working towards a joint humanitarian assistance and disaster relief exercise.
The RAAF has invited India to attend air combat Exercise Pitch Black next year.
"We see enormous potential in our bilateral defence relationship so we look forward to working with India towards that goal," Mr Andrews said.
While boosting the defence relationship is important, he said the government's top bilateral priority was concluding a free trade deal, termed the Comprehensive Economic Co-operation Agreement.
Australia wants that finalised by the end of this year.
"Australia and India are natural economic partners and a mutually beneficial, high quality agreement will help unlock the potential of the already strong Australia-India relationship," he said.
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