Australia and the United States should form a three-way security dialogue with India, in part to help counter any naval aggression from China, a paper released Friday said.

Produced by three think-tanks -- Australia's well-respected Lowy Institute, India's independent Observer Research Foundation and the conservative Heritage Foundation in the US -- the report calls for greater engagement with New Delhi, including in counter-terrorism.

"This paper provides ideas for establishing US-Australia-India dialogue and coordination across a host of economic, political, and security issues," the document said.

"As confidence and trust build among the three nations, they should explore closer strategic and operational collaboration, beginning with transnational security issues and potentially moving into more high-end areas.

"In time, these might include surveillance, maritime expeditionary operations, anti-submarine warfare and perhaps even integration of theatre missile defence."

The paper -- entitled "Shared Goals, Converging Interests: A Plan for US-Australia-India Cooperation in the Indo-Pacific" -- notes that India "does not yet treat Australia as a priority security partner".

Canberra and New Delhi signed a joint declaration on security co-operation in 2009, but the paper said that since then the tempo of military exercises had been slow.

"Apparently a major reason for this is continued Indian disappointment with Canberra's failure to change its policy banning uranium sales to India for civil purposes," it said.

The paper, which called on Australia to approve the sales to help India meet its energy needs, said the Indian and Australian navies "will likely find themselves monitoring contiguous maritime zones".

It noted a series of incidents of Chinese "harassment" of other countries since 2009, especially in the South China Sea, adding that Sino-Indian competition at sea was likely to intensify.