Varghese's first diplomatic posting was at the Australian Embassy in Vienna from 1980 to 1983. His second overseas posting was at the Embassy of Australia, Washington, D.C. from 1986 to 1988. From 1989 to 1990, Varghese was a speechwriter to Foreign Minister Gareth Evans. Varghese's first Senior Executive Service appointment within the Department of Foreign Affairs and Trade was as the Assistant Secretary of the Staffing Branch from 1991 to 1992. In 1994 he was posted to the Australian Embassy in Tokyo. He was then the First Assistant Secretary of the Public Affairs Division from 1994 to 1996.