Australia and Indonesia have agreed to resume all military cooperation, following a fracture in the defence relationship earlier this year, Prime Minister Malcolm Turnbull announced on Sunday.

Following a series of meetings with visiting Indonesian President Joko Widodo, a joint statement released on Sunday said both leaders had agreed to "the full restoration of defence cooperation, training exchanges, and activities."

"Our common interests mean we will be much stronger if we work together in our rapidly changing region," the joint statement said.

"Risks and uncertainties only make it more critical we have a strong partnership that enables us to tackle challenges and seize opportunities together."

The announcement comes following revelations in January that Indonesia had decided to suspend all military cooperation with Australia, after a senior Indonesian officer reported seeing "insulting" training material at a Special Air Services (SAS) base near Perth.

At a press conference, Turnbull said it was important that Australia and Indonesia maintain a strong relationship as they are close not only geographically, but in sharing similar social values as well.

"We are both vibrant democracies that stand for mutual respect and diversity," Turnbull said of the Australia-Indonesia relationship.

Meanwhile Australia's prime minister also announced that a consulate would open in Indonesia's second-largest city, Surabaya.

Australian sugar exporters also received good news, as Indonesia has announced it would lower the tariff rate to 5 percent. 

source: Xinhua