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The article examines relations between Indonesia and Australia. Australia's swift and generous response to Indonesia's plight after the Indian Ocean tsunami suggests Prime Minister John Howard is seeking to improve what is probably Australia's most critical local relationship. So far the signs are good. When Howard met Susilo Bambang Yudhoyono, Indonesia's president, in Jakarta, he promised $760 million to Indonesia. It was the biggest aid package in Australia's history. Australia has sent almost 1,000 troops and army engineers to the shattered province of Aceh. This could cause problems once their humanitarian operation is up and running. The presence of an Australian military contingent, even an unarmed one such as this, in a province where rebels have been fighting for almost 30 years, is bound to remind some Indonesians of tensions that have marred relations in the past. For all that, relations between the two countries may be better than they look.