Australia's Prime Minister Tony Abbott has skirted the key issue of asylum seekers during a state visit to Indonesia, choosing instead to focus on improving economic ties between the two neighbours.



Following talks with Indonesian President Susilo Bambang Yudhoyono on Monday, Abbott played down rising diplomatic tensions over refugees, a key issue in the recent Australian election that saw him sweep to power.

"The fact that there is a very strong and high-level delegation of business leaders travelling with me to Indonesia

as part of this visit testifies to the desire of the Australian people to build a much stronger...economic relationship based on greater trade and investment," Abbot said in a joint statement with President Yudhoyono on Monday.

Ties with Yudhoyono's administration have been largely cordial for nearly a decade, but Abbott's conservative administration got off to a rocky start over asylum seekers who make their way to Australia via Indonesia.

Political debate

Yudhoyono too put aside any suggestion of hostility over the issue which has become an emotional political debate in

Australia.



"Australia and Indonesia are both victims with regard to the issue of people smuggling and boat people. For instance, there are many people from the Middle East and other nations who come here and become a social and economic burden for Indonesia ... The solution to overcome this problem is effective cooperation between Indonesia and Australia," Yudhoyono said.



Just days before his vist, at least 31 would-be asylum seekers died when their boat sank off the southern coast of Indonesia, a common transit point for refugees trying to make their way to Australia and against whom Abbott's government has promised to take a tougher line.



Survivors of the accident, which also left around 20 missing, told journalists that they sent their GPS coordinates to Australian rescuers to assist them, but no one came to their aid.

Australia's Finance Minister Mathias Cormann stressed on Sunday that the area where the accident occurred was "under Indonesian jurisdiction" and insisted Australia provided "all appropriate assistance".



Sensitive issue

Abbot's choice of Indonesia as his first overseas trip as premier is in line with a pledge to bolster ties with Asia, but it comes amid tensions after his hardline policies on asylum seekers were criticised by Indonesian officials.

In the campaign for September's elections, he pushed a "stop the boats" policy and has put into place a military-led operation known as Sovereign Borders, which involves turning boats around when it is safe to do so.

Hundreds have died in fatal sinking of boats in recent years, as huge numbers continue to board rickety, wooden boats in Indonesia to try and make the treacherous sea crossing to Australia.

The issue is hugely sensitive in Australia, where public anger is growing at the continued influx of people via the boats, and it was a key battleground issue during the elections.

But while Abbott's policies helped propel him to power, they have already strained the traditionally strong relationship between Indonesia and Australia, with Jakarta saying the measures could infringe Indonesian sovereignty.

During a meeting with his Australian counterpart Julie Bishop in New York last week, Indonesian Foreign Minister Marty Natalegawa said the measure could put cooperation on asylum-seekers at risk.