Swap plays into Malaysia's explosive racial divide

WHICHEVER way the High Court rules on the Gillard government's so-called Malaysian solution, the issue has profound implications for either Australia's domestic political uncertainty or our regional diplomacy.

While the deal has the potential to stem the flow of boats, which is a desirable humanitarian outcome, it is impossible to overlook the fundamental problem that makes the arrangement unacceptable: it sees Australia officially enter into a trading agreement involving human beings.

Given the tri-partisan consensus that people-smuggling is repugnant, broad uneasiness about a government-to-government asylum-seeker-refugee swap is understandable.

Myriad complications always were certain to arise from such an adventurous policy, which is why, as sources confirm, the Prime Minister was advised by the Department of Foreign Affairs and Trade and her own department, not to announce the proposed deal as early as she did. Having disregarded this advice, Julia Gillard jeopardised the negotiations and was fortunate any agreement was reached. Yet even if it survives the High Court challenge, the arrangement will remain vulnerable to Malaysian domestic politics.

I spent the past week in Malaysia, where it is impossible to ignore aspects of the deal that receive little or no attention in Australia.

The refugee swap plays directly into Malaysia's explosive ethnic-religious divide, a fracture that continues to define the federation's politics and deliver injustice to the country's non-Muslim population.

Australians are right to be concerned about the human rights abuses that could be inflicted on asylum-seekers sent there, where the standards of care and access to justice are vastly inferior to that on offer in Australia.

But the unspoken advantage most of the asylum-seekers will have in Malaysia, should they be sent, is their Islamic faith. It will help them gain legal status, then bestow on them social welfare benefits and financial advantages.

To some oppositionists and ethnic minorities in Malaysia, the asylum-seekers from Australia are seen as just another example of the Malaysian government conferring preference on Muslims over non-Muslims.

Even four decades after Singapore seceded from the Malaysian federation, and with serious race riots a distant memory, the educational, professional and financial advantages bestowed on the so-called Bumiputra, or indigenous Malays, continues to fuel resentment among the non-Muslim Malaysians, mainly ethnic Chinese and Indians, who make up 40 per cent of the population.

In a country where the terms indigenous and Muslim are seen almost as interchangeable, some see the present amnesty on illegal immigrants as a way of fast-tracking more Muslims on to government benefits and the electoral rolls, with the asylum-seekers from Australia expected to join that preferential queue.

Successive Australian governments have turned a blind eye to these human rights issues in Malaysia, and the ongoing debate about whether it should aspire to be a secular or Islamic state.

There have been good reasons for Australia's soft approach: Malaysia has been firm against extremism, co-operating in the struggle against terrorism; strong people-to-people links, especially through the education sector, are mutually beneficial; and in a world where democracy is a relative term, Malaysia's is very successful by the standards of Muslim nations.

Yet at a time when any Australian diplomatic capital might best be spent urging Malaysia towards more openness and fairness, the people-swap deal trades on Malaysia's chauvinistic policies for Australia's domestic political advantage.

The Malaysian opposition has condemned the deal as appalling and characterises it as Malaysia doing Australia's bidding in an inhumane arrangement.

The 4000 Burmese refugees who will be welcomed to Australia are Christian, or at least non-Muslim. So in the ethno-religious politics of Malaysia, this is seen as a swap of 4000 non-Muslims for 800 Muslims; as squeamish as we may feel about describing the equation in those terms, it is clearly one way in which the deal supports the interests of the ruling Muslim majority.

This comes at a time when the People's Pact coalition of opposition parties is campaigning strongly against claims of electoral unfairness. In recent weeks, protests for cleaner and more equal democracy - in part, code for an end to Muslim preference - have been met by government crackdowns and arrests.

The currency and passion of these tensions was laid bare when the People's Pact Chief Minister of Penang, Lim Eng, told a Singaporean audience this month: "To attain peace Malaysians must stand united and reject those who wish to divide us by preaching racial and religious hatred."

Common sense, and national dignity, would suggest Australia should not play itself into this volatile situation through its people-swap diplomacy.

This is another reason the Gillard government ought to find a way out of the deal. While it has finally recognised the critical role of pull factors in our border protection policy, any good that may come from this potential solution will be outweighed by the bad.

On the domestic political front, the imbroglio dramatically exposes the shortcomings of the Labor minority government's executive power, highlighting the balancing power of the judiciary and the parliament.

The High Court will rule on the legality of Labor's policy under existing law. Ordinarily, if it were to lose, the government might hold fast to its policy and pass new laws to enable it.

On this occasion that option is not viable. The parliament opposes the Malaysian deal; both houses have already passed a motion to that effect. Even if Labor could do a deal with the lower house independents, it is impossible to imagine the Greens supporting any compromise in the Senate.

So defeat in the High Court likely would force the government to process asylum-seekers onshore or at Manus Island and Nauru. Either would be preferable to Australia engaging in a live people trade with a country where human rights are dictated, officially, by religion and race