By Steve Holland, Elizabeth Piper, David Brunnstrom&nbsp;and&nbsp;Lewis Jackson
SAN DIEGO/CANBERRA (Reuters) -The United States,&nbsp;Australia&nbsp;and&nbsp;Britain on Monday&nbsp;unveiled details of a&nbsp;plan&nbsp;to provide&nbsp;Australia&nbsp;with&nbsp;nuclear-powered&nbsp;attack&nbsp;submarines from the early 2030s to counter&nbsp;China's ambitions in the Indo-Pacific.
Addressing a ceremony at the U.S. naval base in San Diego, accompanied by&nbsp;Australian Prime Minister Anthony Albanese&nbsp;and&nbsp;British Prime Minister Rishi Sunak, U.S. President Joe&nbsp;Biden&nbsp;called the agreement under the 2021 AUKUS partnership part of a shared commitment to a free-and-open Indo-Pacific region with two of America's "most stalwart&nbsp;and&nbsp;capable&nbsp;allies."
Sunak called it "a powerful partnership," adding: "For the first time ever it will mean three fleets of&nbsp;submarines working together across the Atlantic&nbsp;and&nbsp;Pacific keeping our oceans free ... for decades to come."
Under the deal, the United States intends to sell&nbsp;Australia&nbsp;three U.S. Virginia class&nbsp;nuclear-powered&nbsp;submarines, which are built by General Dynamics, in the early 2030s, with an option for&nbsp;Australia&nbsp;to buy two more if needed, a joint statement said.
It said the multi-stage project would culminate with British&nbsp;and&nbsp;Australian production&nbsp;and&nbsp;operation of a new&nbsp;submarine&nbsp;class - SSN-AUKUS - a "trilaterally developed" vessel based on Britain's next-generation design that would be built in Britain&nbsp;and&nbsp;Australia&nbsp;and&nbsp;include "cutting edge" U.S. technologies.
Britain would take delivery of its first SSN-AUKUS&nbsp;submarine&nbsp;in the late 2030s,&nbsp;and&nbsp;Australia&nbsp;would receive its first in the early 2040s. The vessels will be built by BAE Systems&nbsp;and&nbsp;Rolls-Royce.
"The AUKUS agreement we confirm here in San Diego represents the biggest single investment in&nbsp;Australia&rsquo;s defence capability in our history, strengthening&nbsp;Australia&rsquo;s national security&nbsp;and&nbsp;stability in our region," Albanese said at the ceremony.
AUKUS will be the first time Washington has shared&nbsp;nuclear-propulsion technology since it did so with Britain in the 1950s.
Biden&nbsp;stressed that the&nbsp;submarines would be&nbsp;nuclear-powered, not&nbsp;nuclear&nbsp;armed: "These boats will not have&nbsp;nuclear&nbsp;weapons of any kind on them," he said.
But the deal comes with an eye-watering bill for&nbsp;Australia&nbsp;with cost estimated to go up to A$368 billion ($245 billion) by 2055.
Albanese defended the spending, saying it was "an economic&nbsp;plan, not just a defence&nbsp;and&nbsp;security&nbsp;plan".
He said he expected AUKUS would result in A$6 billion invested in&nbsp;Australia&rsquo;s industrial capability over the next four years&nbsp;and&nbsp;create about 20,000 direct jobs over the next 30. He said it would require funding amounting to about 0.15% of GDP per year.
Australia's defence minister, Richard Marles, said it was an investment in the nation's security.
"It is an investment that we cannot afford not to make," Marles told a news conference in Canberra.
China&nbsp;has condemned AUKUS as an illegal act of&nbsp;nuclear&nbsp;proliferation. The&nbsp;plan&nbsp;"constitutes serious&nbsp;nuclear&nbsp;proliferation risks, undermines international non-proliferation system, fuels arms races,&nbsp;and&nbsp;hurts peace&nbsp;and&nbsp;stability,"&nbsp;China's permanent mission to the United Nations said in a tweet after the announcement.
Asked if he was worried&nbsp;China&nbsp;would see the AUKUS&nbsp;submarine&nbsp;deal as aggression,&nbsp;Biden&nbsp;replied "no." He said he expected to speak to Chinese leader Xi Jinping soon, but would not say when.
U.S. national security adviser Jake Sullivan pointed on Friday to Beijing's own military buildup, including&nbsp;nuclear-powered&nbsp;submarines, saying: "We have communicated with them about AUKUS&nbsp;and&nbsp;sought more information from them about their intentions."
Australia&nbsp;offered&nbsp;China&nbsp;a briefing on the&nbsp;submarine&nbsp;deal,&nbsp;Australian Defence Minister Richard Marles said.
In launching the partnership,&nbsp;Australia&nbsp;also upset France by abruptly cancelling a deal to buy French conventional&nbsp;submarines.
The agreement will see U.S.&nbsp;and&nbsp;British&nbsp;submarines deployed in Western&nbsp;Australia&nbsp;as soon as 2027 to help train&nbsp;Australian crews&nbsp;and&nbsp;bolster deterrence. U.S. officials said this would involve four U.S.&nbsp;submarines&nbsp;and&nbsp;one British in a few years.
This first phase of the&nbsp;plan&nbsp;is already underway with the U.S. Virginia-class&nbsp;nuclear-powered&nbsp;attack&nbsp;submarine&nbsp;Asheville visiting Perth in Western&nbsp;Australia, officials said.
BIG QUESTIONS&nbsp;AND&nbsp;HUGE INVESTMENT
The U.S. assistant secretary of state for East Asian&nbsp;and&nbsp;Pacific affairs, Daniel Kritenbrink, said in a media briefing on Tuesday that the U.S. had informed its partners in South East Asia about the AUKUS&nbsp;plan, including in Indonesia&nbsp;and&nbsp;Malaysia, last week "to explain clearly what AUKUS is&nbsp;and&nbsp;what AUKUS is not".
A senior U.S. official said AUKUS reflected mounting Indo-Pacific threats, not just from&nbsp;China&nbsp;towards self-ruled Taiwan&nbsp;and&nbsp;in the contested South&nbsp;China&nbsp;Sea, but also from Russia, which has conducted joint exercises with&nbsp;China,&nbsp;and&nbsp;North Korea as well.
Big questions remain about AUKUS, not least over strict U.S. curbs on the extensive technology sharing needed for the project&nbsp;and&nbsp;about how long it will take to deliver the&nbsp;submarines, even as the perceived threat posed by&nbsp;China&nbsp;mounts.
In a reflection of stretched U.S. production capacity, a second senior U.S. official told Reuters it was "very likely" one or two of the Virginia-class&nbsp;submarines sold to&nbsp;Australia&nbsp;would be vessels that had been in U.S. service, something that would require congressional approval.
Analysts said that given&nbsp;China's growing power&nbsp;and&nbsp;threats to reunify with Taiwan by force if necessary, it was vital to advance the second stage of AUKUS, which involves hypersonics&nbsp;and&nbsp;other weaponry that can be deployed more quickly.
British&nbsp;and&nbsp;Australian officials said this month work was still needed to break down bureaucratic barriers to technology sharing&nbsp;and&nbsp;Monday's announcement did not cover this second stage.
The second U.S. official said&nbsp;Australia&nbsp;would contribute to boosting U.S.&nbsp;and&nbsp;British&nbsp;submarine&nbsp;production&nbsp;and&nbsp;maintenance capacity.
He said Washington was looking at "double digit billion" investment in its&nbsp;submarine&nbsp;industrial base on top of $4.6 billion already committed for 2023-29&nbsp;and&nbsp;that the&nbsp;Australian contribution would be less than 15 percent of the total.
Britain, which left the European Union in 2020, says AUKUS will help boost its economy's low growth rate. Sunak said AUKUS was "binding ties to our closest&nbsp;allies&nbsp;and&nbsp;delivering security, new technology&nbsp;and&nbsp;economic advantage at home."
(Reporting by David Brunnstrom, Phil Stewart, Idrees Ali, Mike Stone, Jonathan Landay, Joel Schectman, Steve Holland&nbsp;and&nbsp;Kirsty Needham; writing by David Brunnstorm&nbsp;and&nbsp;Praveen Menon; Editing by Don Durfee, Grant McCool&nbsp;and&nbsp;Stephen Coates)

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Eyeing China, Biden and allies unveil nuclear-powered submarine plan for Australia