Singapore will spend up to A$2.25 billion ($1.67 billion) to double the capacity of its military training facilities in northern Australia under a new bilateral deal, Australia's prime minister said on Friday.
Malcolm Turnbull said that the investment should be seen as a natural development of a close strategic relationship between the two countries.
The Singaporean military upgrade is part of a comprehensive strategic partnership pact agreed by Turnbull and his Singaporean counterpart, Lee Hsien Loong, this week.
The move comes at a time when tension between much of Asia and China is rising as China has been building military and civilian facilities on its artificial islands in the disputed South China Sea.
Singapore, an island country with scarce land, has long sent troops to Australia for military exercises.
The new deal will allow the country to increase the number of troops it has on rotation in Australia to 14,000, from 6,000.
The two countries will enhance military personnel exchanges and initiate civilian personnel exchanges. They will also strengthen intelligence and information sharing, such as counter-terrorism, the MFA statement said.
Under the agreement, Singapore would fund the cost of expanding the Shoalwater Bay Training Area and the Townsville Field Training Area in return it would gain expanded access to Australian military training areas over a period of 25 years.
Both bases lie in electorates critical to the government. The timing of the agreement is viewed as a political coup for Prime Minister Malcolm Turnbull ahead of Federal elections in July.