The talks were the first since a damaging diplomatic rift sparked by Australian spying revelations prompted Indonesia to suspend military co-operation with Australia and co-operation on intelligence sharing and measures to combat people smuggling.
Documents leaked by fugitive US intelligence contractor Edward Snowden said Australia in 2009 attempted to tap the phone of Indonesian President Susilo Bambang Yudhoyono, his wife and other senior officials.
"In relation to the areas of co-operation that are temporarily suspended, as set out by President Yudhoyono, we have agreed to establish a special communications channel, a hotline if you like, to ensure that we can resolve any issues ... that we can avoid any unintended consequences," Ms Bishop told reporters.
"We believe that is an appropriate way forward."
Indonesia has said it wants Australia to sign a new code of conduct to map out the future of the bilateral relationship, including guarantees against future spying activities.
