France has decided to dump Australia from its strategic partnership list over last year's row, which erupted as Prime Minister Scott Morrison terminated a multi-billion-dollar defence deal "without prior consultation or warning" being given to the Emanuel Macron government.
In an updated version of its official Indo-Pacific strategy, the European country said it would now cooperate with Australia on a "case-by-case basis".
"Australia's decision in September 2021, without prior consultation or warning, to break off the partnership of trust with France that included the Future Submarine Programme (FSP), has led to a re‑evaluation of the past strategic partnership between the two countries," the document read.
However, to strengthen coordination in the Indo-Pacific, France will continue its close coordination with the US, which is one of the partners - besides the UK - in AUKUS.
With Australia, the French government will prioritise its national interests and regional partners.
In the 67-page document, Paris said that it would continue to raise its concerns with Washington over the AUKUS agreement.
President Joe Biden admitted last October that the US acted in a "clumsy" way regarding the AUKUS security pact and claimed that he was "under the impression that France had been informed long before that the [French-Australian sub] deal would not go through."
Naval Group of France lost out on a diesel-electric submarine deal with the Australian government worth more than $65 billion last September. Under the new pact, the Royal Australian Navy would receive US and British nuclear reactor technology to build the subs in its shipyards.
A major diplomatic row erupted as Paris deemed the agreement, negotiated in total secrecy from AUKUS's allies, as a "stab in the back".
The Macron government accused Morrison of falsely assuring France that the sub deal was still in place even after it became clear that the security pact would lead the country to cancel the order.