Australia has set up a process to peel back sanctions on Zimbabwe.
Foreign Minister Bob Carr announced on Thursday that if the troubled African nation met three requirements – including the holding of free and fair elections – then Australia would lift sanctions.
The other benchmarks include setting a date for a constitutional referendum and holding a peaceful and credible referendum.
''It would give me enormous satisfaction to see a reinstatement of normal relations with Zimbabwe,'' Senator Carr told reporters in Canberra on Thursday.
''It means we could reach out and talk to this country . . . in a way we couldn't when we were horrified by the departures from democratic norms that marked its recent history.''
Last year on a visit to Australia, Prime Minister Morgan Tsvangirai asked for the sanctions, which were imposed on the Mugabe regime, to be called off.
''He's told us, and Zimbabwean diplomats have told us, that they're committed to democratic reforms,'' Senator Carr said.
Last week, the country announced it had agreed on the text for a draft new constitution.
Since 2002, Australia has implemented sanctions against ''persons or entities who engage in, or have engaged in, activities that seriously undermine democracy, respect for human rights and the rule of law in Zimbabwe''.
Australia's current sanctions include travel and financial restrictions against 153 individuals and four entities, and arms embargo and prohibition on defence links.
Senator Carr said that Australia's plan was consistent with the approaches made by the US and the European Union.