Amidst these discussions, the ongoing drought and natural disasters have resulted in significant economic losses in Australia, prompting government support for recovery efforts.

Albanese reaffirmed that his government will shape Australia's defense policy independently, despite US recommendations for increased military investment.

Currently, Australia's defense budget stands at approximately $53 billion per year, or about 2% of its GDP, with plans to increase to an estimated $100 billion, or 2.4% of GDP, by 2033-34.

During the Shangri-La Dialogue in Singapore, US Defence Secretary Pete Hegseth urged Australia to increase its defense spending to 3.5% of its GDP, which would require an additional $40 billion annually.

In response, Australian Prime Minister Anthony Albanese has consistently resisted these demands, emphasizing that Australia will determine its defense spending based on its specific needs rather than external pressures.

Secretary Hegseth highlighted the urgency of raising defense spending, although Australian Defence Minister Richard Marles noted that a specific GDP percentage was not discussed in their talks.

The Albanese government has committed to an additional $10 billion in defense investment over the next four years, equating to 2.3% of GDP, rather than the requested 3.5%.

While there is support for increasing defense spending, Liberal Senator James Paterson insists it should be driven by Australia's national interests rather than solely by US requests.

Hegseth's comments reflect an ongoing US push for Asian allies to raise military spending, particularly in light of perceived threats from China.

This meeting marks only the second interaction between US and Australian defense officials since President Donald Trump took office, highlighting the significance of their discussions.

Albanese is set to meet with former President Trump during the G7 summit in Canada, where defense cooperation in the Indo-Pacific and trade tariffs will be key discussion points.

Marles acknowledged the US's clear expectations regarding defense spending but emphasized that Australia has already initiated the largest peacetime increase in defense expenditure in its history.