Australia's defense capacities remain underfunded: institute

Australia's defense capacities remain underfunded and this will have serious consequences for both the nation's strategic edge in the Indo-Pacific and the U.S. alliance, a new study from the Lowy Institute for International Policy said on Wednesday.

According to Lowy Institute Military Fellow and report co- author James Brown, Australia's military edge in its neighborhood is slipping and the new Abbott government faces tough decisions in defense policy.

"It must either increase funding to pay for a modernized military or consider drastic cuts to defense capability," he said. "Despite the best bipartisan intentions to the contrary, defense capacities remain seriously underfunded."

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