Prime Minister Kevin Rudd heads to Indonesia this week to take part in the annual Indonesia-Australia leaders' meeting.
Asylum seeker policy looks set to dominate the trip, with speculation that the Labor Party is preparing to toughen its position on the issue.
But security in the region, including growing tensions in the South China Sea, live cattle exports and a Free Trade Agreement will also be on the table.
Amanda Cavill reports.
Indonesia has welcomed Kevin Rudd's return as Australian prime minister.
Julia Gillard was to attend the annual meeting between the leaders of Indonesia and Australia until she was ousted as Labor leader last week.
A spokesman for Indonesian President Susilo Bambang Yudhoyono says Mr Rudd, in his roles as prime minister and foreign minister, had been very highly regarded in Jakarta.
Mr Rudd is expected to discuss a range of bilateral issues including efforts to stem the flow of asylum seekers to Australia, regional security and trade.
He says strengthening Australia's relationship with Indonesia is crucial for the nation's future in the region.
"Let me tell you, if you are a student of the Australia / Indonesia relationship, which I have been since the days of the late '40s until now, there've been some pretty tough times in the relationship. I never want to see that happen again. A quarter of a billion people live to the north of us. We have a huge national interest in having a working relationship with them."
With the asylum seeker issue squarely back on the domestic political agenda. Mr Rudd will raise the issue with President Yudhoyono amid speculation that the Labor Party is preparing to toughen its position on the matter.
Both Mr Rudd and Foreign Minister Bob Carr have recently made comments suggesting that many asylum seekers to Australia are not genuine refugees.
And Kevin Rudd says the Coalition's plan to turn back asylum seeker boats risks harming Australia's relationship with Indonesia.
He says the policy risks a diplomatic confrontation, or worse, because Indonesia does not agree with it.
But opposition immigration spokesman Scott Morrison has warned the Prime Minister against playing domestic politics when he meets with the Indonesian President.
"He should try and be a Prime Minister and not try and drag one of our most important neighbours into a domestic political debate. The government should be focusing on Australia's interests, not on the Prime Minister's political interests. I am encouraged by the maturity with which the Indonesian government has responded to those comments by Mr Rudd. I think he should withdraw those comments. They were reckless, they were desparate and they were completely and utterly unnecessary."
Mr Rudd says he's also keen to accelerate progress on a free trade agreement.
With Indonesia an emerging economic force in the region, both governments want to increase investment in each other's economies.
Trade Minister Richard Marles says the trade relationship with Indonesia is underdone.
"Indonesia is our 12th largest trading partner but we've got countries like Malaysia, like Thailand and Singapore all with much smaller populations who today we have a much bigger trading relationship with. Indonesia is a country wiith 240 milion people. There is an enourmous opportunity for us to grow our relationship with them."
The thorny subject of live cattle exports exports will also be a topic for discussion.
Mr Rudd is expected to seek increased exports of Australian beef.
The Federal Government temporarily suspended live cattle exports to Indonesia in 2011 following public outrage over Australian cattle being mistreated in Indonesian abattoirs.
The cattle industry claims trade has never fully recovered following the ban.
Opposition leader Tony Abbott says something must be done to reverse the damage.
Mr Abbott says the move hurt Australia's domestic cattle industry and soured trade relations between the countries.
"This was a catastrophic decision, very bad for our relationship with Indonesia, disastrous for the cattle industry more generally. We would never make that kind of decision because the Coalition has rural Australia at its heart."
In addition to economics and trade, regional security and the impact of China will loom large on the agenda.
The Indonesia-Australia Leaders' Meeting will be the last attended by President Susilo Bambang Yudhoyono before he retires next year.
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