Australia denies rift with Indonesia over spying allegations

SYDNEY (AFP) - Australian Foreign Minister Julie Bishop has denied a rift with strategic ally Indonesia over spying allegations as she prepared to head on Wednesday to the Bali Democracy Forum.

Canberra's relationship with Jakarta is under pressure after reports last week that Australia's overseas diplomatic posts were involved in a vast US-led surveillance network.

The problems were compounded by a report on Sunday citing a document from US whistleblower Edward Snowden showing that Australia and the United States mounted a joint surveillance operation on Indonesia during 2007 UN climate talks in Bali.

An angry Jakarta on Monday said it would co-sponsor a draft resolution at the UN General Assembly highlighting concern at US-led data snooping while threatening to review its bilateral cooperation with Australia.

Despite this, Ms Bishop denied relations were frayed.

"I don't accept that there has been a rift," she told ABC television late Tuesday. "I'm looking forward to having a very productive conversation with Dr Natalegawa and other Indonesian ministers."

Ms Bishop added that she had a "very fruitful" discussion with visiting Indonesian ministers on Tuesday about the mutual benefit of working together on issues such as combating terrorism and people-smuggling.

"The bilateral cooperation that exists between our two countries in areas such as people-smuggling and counter-terrorism is of mutual benefit, of mutual advantage to both countries, and that will continue to be the case," she said.

Ms Bishop is making her third visit to Indonesia since the new Australian government led by Mr Tony Abbott was elected in September.

Indonesian elections are expected in the coming months, but Ms Bishop refused to speculate on whether the polls were influencing Jakarta's recent rhetoric.

"That's a matter for Indonesia to answer," she said.

The annual Bali Democracy Forum, established by Indonesian President Susilo Bambang Yudhoyono in 2008 to promote the development of democracy in the Asia-Pacific region, is being held from Nov 7-8.

Ms Bishop will speak on the topic "Building and Strengthening Democratic Institutions".