Australia has struck a “watershed” bilateral security treaty with Indonesia in a surprise pact that will see the two nations deepen their defence relationship and consider a joint military response if either comes under attack.
The treaty, which builds on the Defence Cooperation Agreement signed last year, will also commit both countries to “consult at a leader and ministerial level” on a regular basis on security matters and “identify and undertake mutually beneficial security activities”.
The agreement, to be formally inked in Jakarta in January next year, will also see both nations confer in the event of “adverse challenges to either party or to their common security interests” and consider either an individual or joint response.
Standing alongside Indonesian President Prabowo Subianto in Sydney, Mr Albanese said the treaty would help maintain the status quo in the Indo Pacific.
“Australia’s relationship with Indonesia is based on friendship, trust, mutual respect and a shared commitment to peace and stability in our region. This treaty is a recognition from both our nations that the best way to secure that peace and stability is by acting together,” Mr Albanese said.
“It signals a new era in the Australia-Indonesia relationship.”
The ABC understands the agreement was first raised in discussions between Mr Albanese and Mr Prabowo in the week after the May federal election and was negotiated in total secrecy, with both leaders progressing the deal over discussions in New York and ASEAN.
The leaders said the pact signalled a new era in relations between Indonesia and Australia. (AAP: Dan Himbrechts)
The agreement comes on the heels of the PukPuk treaty signed with Papua New Guinea in October that ensures mutual defence and interoperability between the Australian Defence Force and the PNG military, and as Mr Albanese chalks up several foreign policy wins.
That momentum includes a successful first meeting with US President Donald Trump at the White House and separate security pacts with Nauru and Tuvalu aimed at curtailing China’s influence in the Pacific and growing strategic tension in the region.
Government sources confirmed Jakarta was “brought into the tent” when it came to the development of the PukPuk treaty as a sign of good faith, while Indonesia and Australia’s own treaty progressed behind the scenes.
Mr Prabowo on Wednesday described the development as a “good neighbour policy” and a way of facing our destiny with “the best of intentions”.
“Good neighbours are essential. Good neighbours will help each other in times of difficulties,” he said.
“In Indonesian culture, we have a saying: ‘When we face an emergency, it is our neighbour that will help us. Maybe our relatives will remain far away, but our neighbours are the closest to us and only good neighbours will help us.'”
Back to beginning of patchy security history
While the text of the document is yet to be revealed, the agreement is potentially a major step forward in the security relationship between the two nations, which has had a patchy history.
David Andrews from the National Security College told the ABC the treaty had the potential to supplant PukPuk in terms of importance as Indonesia moves towards becoming the world’s fourth-largest economy by 2050.
“The new security treaty announced today may turn out to be the most significant security partnership Australia has established under Prime Minister Albanese — with the potential to even exceed the impact of the Pukpuk Treaty with Papua New Guinea,” he said.
“This agreement opens the door to take that relationship to an even higher level, which is especially important at a time of escalating regional tensions.”
Australia, PNG sign new defence treaty
Mr Andrews did not classify the agreement as “a mutual defence treaty or alliance per se” but said its “language of consulting” and consideration of potential joint action was “consistent with Australia’s existing security partnerships with Malaysia, Singapore, and Japan.”
Speaking on board HMAS Sydney, Mr Albanese said the agreement was based on a previous security deal, signed by prime minister Paul Keating and president Suharto in 1995.
That agreement was expansive but was torn up by Indonesia during the Timor crisis, when Australia led a force to restore order in East Timor.
Relations began to be rebuilt in the wake of the Bali bombings, and in 2006, the Lombok Treaty was signed by the two, which provided a treaty-level agreement on security that was expanded in 2014.
In a nod to the new treaty’s origins, Mr Prabowo met with Mr Keating after his press conference with Mr Albanese on Wednesday.
Jakarta’s other ties
Indonesia’s non-alignment policy has not stopped Mr Prabowo from expanding ties with other countries on both sides of US alignment.
Late last year, Indonesia conducted simultaneous military drills with both Russia and Australia, and at China’s largest ever military parade in September, Mr Prabowo watched on alongside President Xi, President Putin and North Korean leader Kim Jong Un.
Indonesia and China also held joint ‘disaster relief exercises’ in 2024, and Jakarta this year also moved to join BRICS — a loose grouping of countries including Brazil, Russia, India, China and South Africa — that is largely seen as a counterweight to the G7.
Earlier this year, a defence industry report claimed Russia requested a permanent base for its warplanes in Indonesia’s remote Papua region — a story the government denied — but became a political flashpoint over the course of the 2025 federal election.
ABC News understands that should such a request be made by Moscow in the future, the treaty would require Jakarta to consult with Canberra.
First state visit for new president
Before the announcement, Mr Albanese welcomed Mr Prabowo to Kirribilli House before a ceremonial welcome at Admiralty House.
The president, a former military commander, received a flashy display, which included the flyover of two military helicopters.
Mr Prabowo’s whirlwind visit also saw him visiting the governor-general this morning.
This is the Indonesian president’s first trip to Australia since taking office.
He last visited while president-elect and defence minister in August 2024, when details of an upgraded defence agreement were finalised.
At the time, the pact was heralded as the “most significant” the two countries had ever signed, although analysts said the agreement was generally fitting with the increased cooperation between the two by way of military exercises.