Australian Foreign Affairs is published three times a year and seeks to explore - and encourage - debate on Australia's place in the world and global outlook. "While we can never ignore Indonesia's potential as a threat, its potential as an ally is more important to us now than it has ever been." Hugh White The third issue of Australian Foreign Affairs examines the turbulent relationship between Australia and Indonesia, and the missteps and missed opportunities that have prevented the forging of a friendship. It examines Indonesia's rise, its sharp religious and political divisions, and the opportunities and challenges this presents for Australia. Australia and Indonesia is crucial reading for anyone wanting to understand the intricacies of one of Australia's most important relationships. As Asia's power balance changes, the two neighbours need to deepen ties now to avoid a wider gulf in the future. *Hugh White examines why Australia should embrace the rise of Indonesia, which could be a valuable ally but also a dangerous adversary. *Jennifer Rayner analyses Australia's economic and political challenges as it struggles to keep pace with its northern neighbour. *Endy M. Bayuni reports on the Indonesian perspective on Australia and the misperceptions that hinder closer ties. *Tim Lindsey explores the growth of conservative Islam in Indonesia, reflecting on what this means for Australia and the world. *Julia Wallace discusses Myanmar and the Rohingya crisis. *Richard McGregor examines China's authoritarian revival. PLUS Correspondence from Tim Costello, Jim Molan, Peter Jennings, Chengxin Pan and more.