Australia-Indonesia restore defence co-operation in leaders meeting

Australia and Indonesia have agreed to restore defence co-operation and training activities following formal talks between Malcolm Turnbull and Joko Widodo.

The prime minister made the announcement with the visiting Indonesian president in Sydney on Sunday after a bilateral meeting which was also attended by Australian ministers.

Mr Turnbull also announced that maritime co-operation and ties on the digital economy would also be enhanced between the nations, while sugar tariffs in Indonesia would also be reduced for Australian exporters.

The Indonesian leader is on his second day of a whirlwind tour of Australia after arriving in Sydney yesterday. 

Mr Turnbull said he was looking forward to their bilateral meeting on Sunday, picking up where the pair left off when the prime minister visited Jakarta in 2015.

Indonesia's developing potential represents a golden opportunity for Australia, he wrote in Fairfax Media papers.

"As I said on the day, the prospects for our two countries to work together - to grow our economies - have never been better," he said.

Ahead of the visit, Jakarta expressed some concern about the rise of Pauline Hanson's One Nation Party and its view on Islam.

Mr Widodo, known informally as Jokowi, will also host a cultural event for the Sydney Indonesian community in Darling Harbour.

He will also meet Governor General Peter Cosgrove and other ministers before attending a state lunch at Admiralty House where Mr Widodo will receive a ceremonial welcome.

The Indonesian leader and his wife will then leave for home in the afternoon.

With AAP.