Clean energy and electric cars were set to feature heavily in talks between Australia and Indonesia on Tuesday, as the two coal powerhouses look to shed their reliance on fossil fuels.
Indonesian President Joko Widodo, who will meet Australian Prime Minister Anthony Albanese in Sydney, has set the stage by suggesting the two countries build a regional hub for electric vehicle manufacturing -- a move that could loosen China's grip on the booming industry.
Australia's foreign minister, Penny Wong, said Canberra was open to discussing the idea.
"The transition to a clean energy economy is a priority for both nations," she told national broadcaster ABC ahead of the talks.
"President Jokowi has very clearly understood the economic opportunity for his country, he's talked a lot about the importance of Indonesia making that transition and a focus on electric vehicles.
"We want to talk about how we might collaborate".
Indonesia and Australia are the world's two biggest thermal coal exporters, but anxious to shed their economic reliance on polluting fossil fuels.
Widodo's government has grand ambitions for Indonesia to ramp up electric vehicle production, making use of its vast natural deposits of cobalt and nickel.
To do so it would need to secure a reliable pipeline of Australian lithium, another key component in rechargeable batteries.
Australia supplies almost half of the world's lithium, the vast majority of which is currently shipped off to be processed in China.
Bilateral talks between Indonesia and Australia come at a time of increasing tension in the Indo-Pacific region.
Australia and Indonesia have taken starkly different approaches to the fierce strategic rivalry playing out between China and the United States.
Canberra has joined in the landmark Australia-United Kingdom-United States (AUKUS) security pact, acquiring nuclear-powered submarines to increase its naval clout through the South Pacific.
Indonesia has walked a more neutral line, stressing the need for cooperation and regional stability.
Analyst Gatra Priyandita, from the Australian Strategic Policy Institute, said Indonesia had been slowly warming to the AUKUS alliance.
"AUKUS is still seen as posing challenges to regional stability," he told AFP.
"But there is now greater openness to seeing AUKUS as also a source of opportunity for Indonesia’s future security relationship with Australia."
