Another official said Australia needed to be more active in the region and cooperate more with liberal democratic partners to promote a rules-based order, multilateral free trade and ensure the peaceful settlement of disputes.

"We shouldn't be ignoring the rise of India as a key strategic partner."

Australia's former Ambassador to China Geoff Raby warned in Tuesday's The Australian Financial Review the QSD would be counterproductive.

"Recognising that Australia is more dependent economically on China than any of the others, and by a big margin, it is curious why Australia would want to join a group which China sees as hostile to its interests," he said.

"It may seem preposterous in Canberra, but Beijing does in fact feel threatened by the United States. Japan's invasion and occupation of China is still in living memory. And China has a long-standing military conflict with India over disputed borders."

But officials said Australia saw the QSD, which embraces the rapidly emerging India, as an important counter to China's military influence and her territorial ambitions in the South China Sea.

Prime Minister Malcolm Turnbull started laying the groundwork in June in Singapore when he delivered the keynote speech at the Shangri-La Dialogue security summit.

"The gathering clouds of uncertainty and instability are signals for all of us to play more active roles in protecting and shaping the future of this region," he said.


"I believe that the Indo-Pacific, as the most dynamic region, is well-placed economically, strategically, and culturally to shape and drive the global response."

Mr Turnbull emphasised the need for a rules-based order and "a neighbourhood that is defined by open markets and the free flow of goods, services, capital and ideas".

"Where freedom of navigation goes unchallenged and the rights of small states are untrammelled," he said.

Mr Turnbull leaves Thursday for Da Nang, Vietnam, for the two-day Asia-Pacific Economic Cooperation (summit) where trade will be is main focus. On the sidelines, Australia is expected to seal a free trade deal with Peru and will meet with 10 other nations to revive the Trans-Pacific Partnership minus the US which withdrew when Donald Trump become president.

From there, Mr Turnbull will make a lightning visit to Hong Kong to finalise free trade negotiations as well as discuss anti-money laundering techniques to try and curtail North Korea. In Manila, the theme will be security with a heavy focus o both China and North Korea.

Mr Turnbull is planning on a bilateral meeting with Mr Trump in manila and one with Chinese president Xi Jinping on the sidelines at APEC. He will use the meeting to press President Xi over North Korea.