More than a friendly visit

TONY Abbott's first intense test as PM is, appropriately, Indonesia.

Indonesia asylum-seekers

TONY Abbott's first intense test as Prime Minister is, appropriately, Indonesia.

He has started his new job in a cool and calm manner. But within days he will be flying to the hothouse political atmosphere of Jakarta, where he will need to set the government's relationship on the right track.

The new Prime Minister will be accompanied by a powerful group of Australians, to underline his government's core commitment to a broad engagement with our important neighbour. His task looks perilously difficult, compounded by an increasingly feverish political atmosphere as Indonesia enters a year of elections.

Abbott has long promised the voters who gave him such a clear mandate that he will "turn back the boats": a policy that has received a bad press in Indonesia.

He must make progress towards doing so, while demonstrating to the Indonesians that he does not view them only through this domestically focused lens. He has to communicate clearly that he also values building a better relationship with Indonesia as an intrinsically high priority - for all the obvious reasons.

Indonesia is Australia's gateway to Asia, the third biggest democracy in the world, the most populous Muslim nation, a country of crucial security significance, an economy that consulting firm McKinsey forecasts will soar from the world's 16th largest today to the seventh largest by 2030, leapfrogging Australia.

Indonesia is also the fulcrum of pressure from asylum-seekers bidding to build new lives in Australia, one of the world's wealthiest and most migrant-friendly societies, and the people-smugglers whose margins are large enough to spread largesse widely through local networks.

Tim Lindsey, professor of Asian law at the University of Melbourne and chairman of the Australia-Indonesia Institute, tells The Australian: "Indonesia is unenthusiastic at the very least about the Coalition's plan" on asylum-seekers. "It will require careful direct diplomacy to resolve, but I don't think it's insurmountable. It can't be done through media at long range but through discussion between equals."

Lindsey adds: "We have a history of pretty effective diplomatic relations, and all sorts of exchanges and interactions. The platform is in place; it's a question of how the government chooses to manage" this challenge.

This first meeting provides probably the final chance for Abbott to deal with Susilo Bambang Yudhoyono before the Indonesian President is forced to stand down next year after completing two five-year terms and becomes a lame duck in terms of steering policy.

Lindsey describes SBY as "exceptionally graceful towards Australia. He has managed to detach himself from the carelessness with which we have too often treated Indonesia, and has become really supportive of the relationship."

Neither of the two leading presidential candidates, at this stage, offer the same.

The better bet, from Australia's perspective, is Joko Widodo, who was mayor of Solo in central Java and is now governor of Jakarta. He has become popular for his reforms, his lack of corruption and his drive for better governance.

The headache would be a win for Prabowo Subianto, a son-in-law of former dictator Suharto. He was cashiered from the army for abducting and torturing students as Suharto fell and his human rights record in East Timor was grim. He is running on a strongly nationalist program that would boost economic protectionism and oppose any attempts to "interfere" in Indonesian affairs.

The meeting between Abbott and SBY will set the pattern for the next year or more, until the new president settles into office, and could calm the anxieties of the Indonesian media, which has become hostile to Australian plans over asylum-seekers.

It will be important, Lindsey says, to work closely with Indonesia's top public servants, including Foreign Minister Marty Natalegawa, many of whom may continue in their positions following the elections.

"Building a consensual relationship is more important in Indonesian politics than in Australia," he says.

The message Abbott will wish to convey is that he will be careful and measured, will avoid policy surprises, and wants to work constructively with Indonesia across a broad range of matters beyond turning back the boats.

Reintegrating AusAID into the Department of Foreign Affairs and Trade, the Prime Minister said yesterday, would enable "the aid and diplomatic arms of Australia's international policy agenda to be more closely aligned".

This would indicate that since Indonesia is top of Abbott's diplomatic priorities, the AusAID programs there - in which education takes priority, followed by health and governance - may escape lightly, or even unscathed, from the cutbacks announced at the end of the election campaign.

Australia has its biggest embassy in Jakarta. But it has no consulates elsewhere in the country beyond Bali, with DFAT resources having been cut back by successive governments. A consulate in eastern Indonesia would enable closer co-ordination with the local authorities over people-smuggling, in a low-key manner that would avoid the glare of the national institutions - including the parliament and the main media HQs - in the capital.

Ross Taylor, chairman of the Western Australia-based Indonesia Institute and a former Australian trade commissioner in Jakarta, says: "When both China and the US are positioning themselves to be the dominant force in the Asian region, Indonesia understands that a strong and cohesive relationship with Australia is vital. Therefore it is unlikely that SBY would openly criticise the main thrusts of the turn-back-the-boats policy. There are just too many other major issues that demand a close bilateral relationship."

The danger for Australia, he adds, is that "an issue that could be portrayed within Indonesia as Australia acting in an arrogant and self-focused manner could provide opposition parties with a chance to boost the nationalistic vote". Thus Abbott needs to exercise "great care", given the volatility of the political environment in Indonesia today.

Foreign Minister Julie Bishop, who may be joining the Prime Minister on the visit to Jakarta, is first flying to the UN on Saturday, where she will talk with Natalegawa, her urbane and articulate Indonesian counterpart, and holder of a PhD from the Australian National University.

She told Sky News that "we intend to implement" the government's policies on asylum-seekers "by legislation and operationally, and they will not breach Indonesia's sovereignty".

"We're not asking for Indonesia's permission, we're asking for their understanding," she said. "Of course all relationships require managing, but there is a level of respect between Indonesia and Australia and we will maintain that."

It is not clear yet whether Angus Campbell, the former SAS soldier who is being promoted to lieutenant-general and has been appointed to head the new Operation Sovereign Borders, will travel to Jakarta with Abbott to meet the Indonesian President, once a general himself.

Campbell's capacity for managing the relationship with Indonesia will prove especially important in the weeks and months ahead. It will be impossible for him to succeed without the support of the Indonesian authorities.

Natalegawa said last week: "We will have a discussion with Abbott prior to the APEC summit in October. We will reject his policy on asylum-seekers and any other policy that harms the spirit of partnership." The context is important, though. This was not a statement issued coolly from his office. He was answering questions to the foreign affairs commission of Indonesia's often highly nationalistic and tumultuous parliament, where MPs have been jostling for attention in the lead-up to next year's election.

The people-smuggling issue will be dominant for some time. But more peripherally, West Papua is another problem that won't go away. Australian academics and non-government organisations tend to strongly support independence for the two Indonesian provinces there, in the expectation West Papua's prospects resemble East Timor's.

Here, as in other areas including people-smuggling, Abbott and Bishop are likely to find an ally in Papua New Guinea's Prime Minister Peter O'Neill.

O'Neill has launched an initiative with SBY in Jakarta to bring rapid economic development to the centre of the New Guinea island the countries share, with Indonesia's military pulling back and autonomy being advanced as in Aceh; while in return PNG persuades fellow Melanesian nations to swing behind Jakarta.

The Labor government's ban on live-cattle exports to Indonesia following the ABC's Four Corners television program in 2011 created another issue between the countries. But this can end up as a net positive if it leads to greater mutual investment and involvement in the food chain, with Indonesia's rapidly growing middle class pursuing a higher protein diet.

There has been discussion within Indonesia of buying a million hectares of cattle country, a move swiftly opposed by Barnaby Joyce before he became Agriculture Minister.

But this would amount to less than a couple of cattle stations, up to 6000 cattle, and probably would be effected through joint ventures rather than through a wholly foreign takeover.

Taylor says the Indonesian suggestion is an olive branch "extended to us as part of the healing process after the disastrous handling of the live-cattle export industry resulting in missed opportunities, not only to build our cattle and meat trade but to develop new partnerships in horticulture".

At the top level, the Canberra-Jakarta relationship is "pretty well managed", says Lindsey. "But that's not enough. It needs deeper institutional and people-to-people engagement. That's just not happening through market mechanisms at the moment, so we need to do more to engineer that, for our national interest."

The Australian public's view of Indonesia has become "unremittingly negative" since the country became democratic, he says. "It was more positive under Suharto."

Lowy Institute polling shows only one-third of Australians are aware Indonesia is a democracy, which it has been for 15 years.

Andrew MacIntyre, dean of the ANU's college of Asia and the Pacific, describes Indonesia today as "a normal country".

But the pressure on Abbott and, to a lesser degree, SBY, at their imminent meeting will be abnormal.

"It's a big moment," says Lindsey - a big moment for this big issue, this big relationship.