I Am Australian. So Am I

Mehreen Faruqi, a Pakistani-born environmental engineer, is the epitome of the Australian spirit of “giving people a fair go.” Arriving in Sydney in 1992 with her husband and young son, Faruqi earned her Ph.D. and worked in water management. Her husband started out driving a taxi, before scoring a job as a civil engineer. In June, Faruqi made history as the first Muslim woman to be elected to an Australian legislature. “What does it mean to be Australian?” asks the New South Wales state MP. “Besides the indigenous peoples, we all immigrated here. There are 260 languages spoken in Australia, something like 300 different types of ancestry. There is no one single version of what Australia is.”

For much of the continent’s recent history, to be Australian was to be one thing: white. This sunburned national identity was little encumbered by the existence of the Aboriginal population or a 19th century influx of Chinese miners, Pacific Islander laborers and the odd Afghan cameleer. Until the 1970s, racial preferences were institutionalized in a White Australia immigration policy. But an embrace of multiculturalism and upsurge in immigration since then has changed the face of the nation. In the 2011 census, over 10% of Australia’s now 23 million people identified themselves as Asian, more than double the percentage a decade before. Refugees from places such as Iraq, Sudan and Afghanistan — heirs to the Vietnamese, Lebanese and former Yugoslavs of yesteryear — have further diversified the country. All in all, more than one-quarter of Australians were born abroad — the highest percentage of any developed nation. Whether all Australians accept it or not, the country’s demography has passed a point of no return. “The dominant narrative of Australia was one of European settlement, of white people farming and mining,” says Finance Minister Penny Wong, the country’s first Asian-born Cabinet member. “But that doesn’t accurately reflect our modern identity, which has been reworked in a way that is very different.”

(MORE: Australia Is the World’s Happiest Country — Again)

A nation that once imagined itself a part of the British Isles that somehow got stranded in the southern hemisphere is also embracing the reality of our age: Asia is ascendant. Already, Australia’s largest trading partner is China, whose appetite for natural resources helped the antipodean nation avoid recession even as other economies succumbed. Last October, the ruling Labor government, now under the stewardship of Prime Minister Kevin Rudd but then led by Julia Gillard, released a white paper called Australia in the Asian Century that made the nation’s priority clear: “Asia’s extraordinary ascent has already changed the Australian economy, society and strategic environment. The scale and pace of the change still to come mean Australia is entering a truly transformative period in our history.”

Other governments — from that of Gough Whitlam, who in 1973 became the first Australian Prime Minister to visit China, to Bob Hawke, who inspired the formation of APEC, and Paul Keating, who furthered regional economic engagement — have edged the country closer to Asia. But the changing complexion of Australia and the current imperative of geopolitics have completed this voyage. Rudd, who began his second stint as Prime Minister in June after unseating his Labor rival Gillard (who had previously dethroned him in 2010), speaks fluent Mandarin and once served as a diplomat in Beijing. Even Gillard, a self-confessed foreign policy neophyte, understood the primacy of Asia when she traveled to China in April and assured her hosts that Australia’s historic ties with the West would not undermine its eagerness to connect with the East. “There’s never been a sharper need [to focus on Asia] following the global financial crisis,” Gillard told TIME in Beijing. “We are in a world where Asia is going to be the engine of global growth. There is a need for every level of Australian society to think deeply about this century of change in our region and how Australia fits in.”

Minority Games
But, first, Australia’s transformation began at home. When Dai Le arrived in Australia in 1979, she got called the usual names: “ching-chong,” “slanted eyes,” “refo” — a dig at her origins as a Vietnam boat person fleeing strife in Saigon. Yet, compared with the privations of Asian refugee camps, such racism felt inconsequential. After her family moved to the Vietnamese-dominated enclave of Cabramatta near Sydney, Le turned into the model immigrant, studying law and journalism at university and later working for a TV network, where she was, she recalls, the “token Asian.”

As soon as she could, Le left Cabramatta, a then heroin-plagued neighborhood where people had to avoid treading on hypodermic needles. Like the Central and East European settlers who arrived in the mid-1900s, later waves of migrants to Australia have tended to clump together. Some of these districts, like Cabramatta or Middle Eastern communities near Sydney, have felt uncomfortably close to ghettos, the closest Australia has had to zones of gang warfare. “I moved out because I was embarrassed and rejected my heritage,” Le recalls. “I hardly had any Asian friends. I wanted to be Australian.”

MORE: Rudd Redux: The High Electoral Stakes Behind Australia’s P.M. Switch

But five years ago, Le found she missed home and that Cabramatta — once a symbol of immigrant urban blight — was that home. Today, the 45-year-old represents the electoral ward in state politics. Cabramatta too has changed. Although hardly a single white Australian strolls down the main street — with its storefronts selling Vietnamese herbs and pungent slabs of dried fish — the druggies have vanished, as has much of the crime. New migrants have arrived too, including gangly Sudanese who tower over the crowds of Vietnamese, Chinese and Khmer shoppers. Leaders in Europe — like British Prime Minister David Cameron, German Chancellor Angela Merkel and former French President Nicolas Sarkozy — have rejected multiculturalism. But Australians from both major parties, Labor and the center-conservative Liberal Party that may assume power later this year after federal elections take place, largely support the policy. Says Malcolm Turnbull, the former leader of the Liberal Party, who has traveled extensively across Asia: “Australia is arguably the most multicultural country in the world.”

During his first stint as Prime Minister from 2007 to 2010, Rudd increased immigration quotas, particularly for Asians. His predecessor Gillard has spoken of Australia’s changed worldview. “When I was growing up, we looked over Asia to Europe and to America,” she told TIME. “Your whole definition of broadening your horizons was to get to New York, to London. For [Australian] students today, the world, increasingly, is getting to China, visiting Japan, Indonesia, having a sense about Vietnam, Korea, studying the languages of our region.” Still, multiculturalism in Australia has its limits. Parliament and other seats of power are far whiter than the Australian populace. “The Liberal Party loves me because I look Asian but speak like an Australian,” says legislator Le. “An Asian PM in Australia? There’s no way we’re going to get that for another 100 years.”

(MORE: Australia’s Message to Asylum Seekers: Go Away)

The China Syndrome
Domestic politics aside, Australia is drawing closer to Asia. Despite the country’s historic connections to Britain and its enduring friendship with the U.S., Australia’s economy is tied to one emerging power: China. Beijing’s appetite for natural resources, as well as for agriculture and services, has reshaped the Australian economy. One-third of Australia’s exports head to the Middle Kingdom. The Chinese are flooding Australian universities. At the University of Sydney’s business school, for instance, 1,300 of the 1,800 post-graduate foreign students are Chinese. Mandarin is the second most spoken language in Australia after English.

Still, tensions have surfaced, only natural as a Western-style democracy negotiates an Asia-Pacific whose biggest power is an increasingly assertive, authoritarian state. In 2010, a Chinese-Australian mining executive was jailed in China in what some considered a politically motivated case, spooking Australian business. Beijing tried to apply crude pressure on Canberra when an exiled leader of the Uighur ethnic group, which faces persecution in northwestern China, visited Australia. “So far the China story has only had an upside for Australia — as quickly as we could pull things from the ground, Chinese companies bought them,” says Michael Fullilove, executive director of the Lowy Institute for International Policy in Sydney. “But the reality of an intimate relationship with a nondemocracy is making itself clearer. There is an uneven quality to China’s foreign policy: usually quiet but sometimes strident, usually cautious but sometimes combative, always prickly, never entirely predictable.”

Despite Rudd’s China expertise, his first pass as Prime Minister didn’t do much to improve the China-Australia relationship. Beijing fretted over his earlier critique of the Chinese government’s human-rights record. It was Gillard who, during her April trip to China, managed to ink a strategic partnership that will formalize regular high-level military and political dialogue. The agreement is possibly the biggest bilateral accomplishment in decades and a sign of China’s importance to Australia — even as its economy slows and its demand for Australian products dips.

By contrast, rewind to two years ago when U.S. President Barack Obama stood before the Australian parliament and proclaimed that “the United States is a Pacific power, and we are here to stay.” Australia has fought alongside the U.S. in every major conflict over the past century. Many read Obama’s pivot (or rebalancing, as it’s now been dubbed) to Asia as an attempt by both Washington and Canberra to curb a rising China. Obama announced that 2,500 U.S. Marines would be stationed in Darwin, on Australia’s northern coast, at a time when China was jousting with multiple Pacific neighbors over disputed isles and shoals.

MORE: Australia’s Aborigines Launch a Bold Legal Push for Independence

Yet, perhaps given Canberra’s evolving ties with Beijing, Gillard later underplayed the troop deployment, part of a broader U.S. military buildup in the Pacific. “Marines are pretty good, but 2,500 Marines, describing that as a containment policy is fanciful in the extreme,” she told TIME in Beijing. “We do not have a containment policy. The U.S. does not have a containment policy. As China rises, inevitably there will be some strategic competition. But we think it’s in everyone’s interest to make sure that it’s managed so that it doesn’t take away from an ability to work together.” In May, the Australian government released a defense white paper that dialed back concern over China’s military rise and noted that Australia “does not approach China as an adversary.” Still, this official positioning hasn’t softened the Australian public’s attitudes toward China. A recent Lowy Institute poll found that 57% of surveyed Australians thought their government was allowing too much Chinese investment and 41% believed China would become a military threat to Australia in the next two decades.

Racial Politics
Australia will hold federal elections on sept. 7. The ballot could well usher in the Liberal Party, led by Tony Abbott, as voters abandon the infighting-plagued Labor Party. As always, the election will serve as a referendum on how a changing country defines itself. Xenophobic politicians — like Pauline Hanson, whose One Nation party made headlines in the late 1990s alongside Austria’s Jörg Haider — no longer command significant popular support. (In a measure of her downfall, Hanson resurfaced on reality TV as a contestant on The Celebrity Apprentice Australia.) But the divisive subject of asylum seekers, who in record numbers have been crowding unsafe boats to reach Australia, is proving a major electoral issue. In July, Rudd announced that any visa-less asylum seeker arriving by boat would be sent to camps in neighboring Pacific island nations with no chance of settling in Australia. While Rudd’s new policy, which reverses his first-term stance, is designed to appeal to voters, its tone of implacability has offended human-rights advocates.

(MORE: Harsh Sentence a Warning to Australia’s Youthful Muslim Zealots)

Multiculturalism too remains a sore point, especially on the fringes of Australian politics — and the concept’s critics include some surprising individuals. Sri Lankan immigrant Daniel Nalliah, who lives in Melbourne, has founded a new political party, Rise Up Australia, whose slogan is “Keep Australia Australian.” “Multiculturalism, the very thing that Australia is pushing to unite us, is dividing us,” says the evangelical Christian pastor, who warns that Muslims are overpopulating Australia. “I chose to come here, it’s my duty to assimilate.”

Nalliah’s fledgling party may not have much electoral impact. But the popularity of Bob Katter, a cowboy-hat-wearing MP from Queensland, shows the enduring political power of Australia’s fabled outback. While Katter’s ancestry includes Irish and Lebanese roots, his family has been farming in Australia since the 1880s. Through his party — registered as Katter’s Australian Party — the populist politician has called for a slowdown in immigration and zero tolerance for asylum seekers. Katter recently said that only Australians born in the country should play on the national cricket team. Nevertheless, Katter’s Australian Party is fielding minority candidates, including Bishrul Izadeen, an aircraft-maintenance engineer whose job may soon be outsourced overseas. “He’s very short, very black and, I presume by the name, very foreign,” says Katter. “He doesn’t speak English very well. But he has a sense of duty to fight for his job here.”

Katter’s office says it’s of no consequence that Izadeen, originally from Sri Lanka, is Muslim. Australia’s Muslim citizens have had a harder time fitting into the national fabric than other immigrants. Local wariness toward Muslim Australians is partly a product of global terrorism, like the bombings in Indonesia that claimed dozens of Australian lives. Instead of being just another faith practiced in a diverse Australia, Islam has been imbued with radical overtones — a mind-set only hardened by the higher crime rates in certain Lebanese-dominated Australian communities that, in fact, are both Muslim and Christian. Says Rebecca Kay, a former bar hostess who converted to Islam after marrying a Lebanese refugee: “Because I wear a scarf, I have to prove my patriotism so much more.”

That’s something even the most privileged members of Australian politics can understand. Penny Wong, the nation’s Finance Minister, was born in Borneo, the daughter of a Chinese-Malaysian architect. When she was 8 years old, her parents separated, and her mother, of South Australian farming stock, moved the family to Adelaide. Wong was teased for her Chinese looks. When she ran for the Senate in 2001, she was determined to transcend ethnic politics. “As an Asian, I was very conscious that I wasn’t going to be the ‘Chinese Senator,'” Wong recalls. In June, the 44-year-old Wong made history as the first woman to serve as leader of the Senate. She has broken another barrier as Australia’s first openly gay Cabinet member, not to mention its first Asian-born one. A woman, an Asian, a lesbian. Who better to serve as the face of modern Australia, the lucky country whose greatest resource is its diversity of humanity?

— with reporting by Ian Lloyd Neubauer / Sydney

PHOTOS: Great Barrier Reef Under Threat