Bishop looks to ‘next step’ in rebuilding Indonesia relationship

Australia’s Indonesian ambassador has returned home after being recalled in the wake of the Bali Nine executions, and has met with Julie Bishop to manage the fallout from the diplomatic crisis.

The government is taking its first steps towards rebuilding Australia's damaged relationship with Indonesia after Ms Bishop met with recalled ambassador Paul Grigson in Perth today.

Mr Grigson returned to the country in the wake of Indonesia's executions of Bali Nine duo Andrew Chan and Myuran Sukumaran.

Speaking with media afterwards, she said the government could now take the "next step" of managing the fallout from the executions.

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"We will now discuss the short-, medium- and long-term consequences and how we will manage the relationship going forward," Ms Bishop said.

Asked whether cuts to foreign aid to Indonesia would be part of the response, the minister said budget discussions were a matter for cabinet.

She declined to say when the ambassador would return to Jakarta.

Indonesia had dismissed the recall of Mr Grigson as a standard diplomatic move, and a knee-jerk reaction in the wake of the executions.

Chan and Sukumaran were executed by firing squad along with seven other prisoners early on April 29 on Indonesia's "execution island" of Nusa Kambangan.

International outcry against the sentence preceded and followed the executions, with Australia's government making repeated pleas for Indonesia to reconsider its stance.

With AAP.