Australia is all set to boost defence and trade ties with Myanmar as it pledged a $20-million assistance to Yangon as part of its aid programme.

“There was ‘much to do’ in Myanmar, formerly known as Burma, to improve human rights and national reconciliation,” Prime Minister Julia Gillard was quoted as saying to Australian news agency.

“But we have been very admiring of the remarkable amount of progress . . . and we are optimistic of further progress,” she said today.

Gillard also disclosed that a trade commissioner would also be posted to Yangon, the Burmese capital. The announcement was made at a joint press conference with Burmese President Thein Sein.

Gillard praised the “extraordinary” progress towards democracy of Myanmar.

She said that Australia would lift some restrictions on defence engagement and post a resident defence attacho Burma. But the arms embargo and other sanctions would remain for the time-being, she said.

Thein said that he recognised human rights concerns but said that his country is making the “transition to peace’’.

“What we are undertaking has no precedent in modern times,” Thein Sein said.

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