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Indonesian President Susilo Bambang Yudhoyono begins a visit to Australia today to discuss a regional trade pact and cooperation in combating people smuggling and terrorism with Prime Minister Kevin Rudd.

Yudhoyono will address a joint sitting of the Australian Parliament in Canberra tomorrow, the first time an Indonesian head of state has given a speech to the assembly. U.S. President Barack Obama will address parliament when he visits Australia later this month after a trip to Indonesia.

“We are dedicated to shaping a new era in Australia- Indonesian relations,” Yudhoyono and Rudd said in an article published in The Age daily newspaper today. “Australia and Indonesia have come a long way in recent years.”

Indonesia, the world’s most populous Muslim nation, lying to the north of Australia, and is the largest recipient of Australian aid, estimated by the Department of Foreign Affairs and Trade at $452.5 million for 2009-10, and is Australia’s 13th-largest trading partner. About 400 Australian companies operate in Indonesia, including in the mining, construction, banking, transport and food and beverage industries.

Rudd and Yudhoyono, in their article, described the relationship between Indonesia and Australia as “resilient” as the countries combat the global financial crisis, terrorism and climate change.

The Australian government today appointed Yudhoyono as an Honorary Companion of the Order of Australia “for strengthening Australia-Indonesia relations, and promoting democracy and development in Indonesia.”

Indonesia aims to complete within months the requirements of a free trade agreement between Australia, New Zealand and the Association of Southeast Asian Nations, the 10-country group that includes Indonesia. The accord was signed by trade ministers in February 2009 in Hua Hin, Thailand.

Rudd and Yudhoyono are expected to discuss combating people smuggling during their talks. Australia has seen an increase in refugees arriving by boat in the past year. Most reach Australian waters via Indonesia.

A total of 20 boats have arrived so far this year, including two vessels intercepted at the weekend carrying 113 people.

Indonesia has worked closely with Australia to combat the terrorist threat posed by groups linked to al-Qaeda.

The threat posed to Australian tourists and business people travelling in Indonesia was highlighted by the hotel bombings in Jakarta in July 2009. The Jemaah Islamiyah group is blamed by Indonesia and Australia for bomb attacks in Bali in 2002 that killed 202 people, including 88 Australians, and in 2005 when three suicide bombers killed themselves and 20 people.

A 2004 blast outside the Australian embassy in Jakarta killed at least nine people.

The two countries are also working closely to combat illegal fishing in Australia’s northern waters. Incursions are largely made by vessels from Indonesia and Papua New Guinea, targeting shark, reef fish, tropical rock lobster or trepang (sea cucumber), the Australian Fisheries Management Authority said on its Web site.

Foreign Minister Stephen Smith said the relationship with Indonesia is one of Australia’s most important.

“Indonesia, of course, is a near neighbor, but Indonesia is now emerging not just as a regional influence but as a global influence as a member, for example, of the G20,” Smith told the Australian Broadcasting Corp. today. “That underlines the long- term strategic, economic and social importance of Australia working very closely with Indonesia.”

Bloomberg