Scott Morrison has warned of escalating regional tensions and stressed the need for like-minded countries to band together against a multitude of threats.
In a recorded speech to the Raisina Dialogue in India, the prime minister described the Indo-Pacific as the epicentre of strategic competition.
He said the region was dynamic, diverse and full of promise.
"But we're also not blind to the geopolitical realities," Mr Morrison said.
He said tensions over territorial claims were growing and military modernisation was happening at an unprecedented rate.
"Democratic sovereign nations are being threatened and coerced by foreign interference. Cyber attacks are becoming more sophisticated, including from state-sponsored actors, and frequent," Mr Morrison said.
"Economic coercion is being employed as a tool of statecraft. Liberal rules and norms are under assault."
The prime minister warned the world was at risk of moving towards "a great polarisation".
"A polarisation between authoritarian regimes and autocracies, and the liberal democracies that we love," he said.
"A liberal democracy and a liberal set of values that underpin the global world order that has delivered so much for the world."
Mr Morrison said the coronavirus pandemic had accelerated and accentuated strategic tensions.
"However, the pandemic has also given us a fresh perspective and created new opportunities to build a durable strategic balance in the Indo-Pacific."
The prime minister emphasised the need for Australia and India to work more closely together and praised India's increasing regional presence, which is considered a crucial counterbalance to Chinese expansion.
He praised India's leadership with the manufacture and distribution of coronavirus vaccines, which have been shipped to more than 80 countries.
Mr Morrison talked up the importance of the Quadrilateral Security Dialogue, known as the Quad, which includes Australia, India, the United States and Japan.
He also spoke of fostering stronger ties with Southeast Asia nations.
Mr Morrison said the region confronted some formidable challenges and the pandemic had sparked a renewed appreciation of like-minded nations working together.
"It has inspired action to defend our collective interests," the prime minister said.
"Together, we carry the aspirations for the future. A region stable, a region prosperous with healthy people and a clean environment. We will continue to work together to achieve those goals."
Australian Associated Press
