The Australian government plans to invest nearly US $578.6 million to modernise four military bases as well as conduct joint military exercises with the US in a bid to make its forces battle-ready.

In a statement on Wednesday, the Prime Minister’s office said: “The Morrison Government will invest (Australian) $747 million to upgrade four key training areas and ranges in the Northern Territory to enable the Australian Defence Force to conduct simulated training exercises and remain battle-ready.”

Australian Prime Minister Scott Morrison said Canberra would work with allies including Washington to focus on "pursuing peace, stability and a free and open Indo-Pacific".

The budget also includes plans to hold military exercises with other Indo-Pacific countries as well. The ten-year project is expected to boost local economy as the government plans to sign contracts with local enterprises.

Reports indicate that the military bases that Australia is upgrading lie in the northern part of the nation. After upgradation, American military too will be in a position to use these bases in case hostilities arise in the region.

In separate news, Australia is procuring Abram tanks and other armoured vehicles from the US. The aim is to meet its current and future needs. This would allow Australia to be able to better support US forces in times of possible conflict.

Australia is spending to fortify itself as relations with China have declined fast in just a year. Australian Defence Minister Peter Dutton said late last week that a conflict with China over Taiwan cannot be discounted. He was referring to increased military activity by China in the South China Sea and also the militarisation of bases in the region.

On the other hand, China has made no bones about its intentions to invade Taiwan and take over the tiny island nation by force. It has been provoking the country by sending fighter jets as well as naval vessels into Taiwanese territory. In retaliation, Taiwan has inched closer to the US and sought increased military support.

Three days back Australian home secretary Michael Pezzullo raised eyebrows globally with his remark that the "drums of war are beating" and the country must be prepared to send its warriors to fight, as it had done so in World Wars I and II.

Australia is one of the few countries which has demanded a thorough investigation into the origins of the coronavirus that spread worldwide from Wuhan in central China. This pitched it head-on into a bitter verbal and economic confrontation with China. The communist giant has since then reduced Australian imports with a view to teaching it a lesson and unleashed its wolf warrior diplomacy trying to humiliate Australia publicly. Recently, Australia cancelled projects related to China's ambitious Belt and Road Initiative (BRI), further infuriating Beijing.

Australia has been building its maritime capabilities by participating in naval and maritime exercises with like-minded countries. Last year it joined the QUAD countries – USA, India and Japan in the Malabar exercises in the Arabian Sea and the Bay of Bengal. Recently, Australia conducted patrolling exercises with the French Navy as the two nations sailed in the disputed South China Sea, all of which is claimed by China causing consternation among numerous south-east Asian nations.