'New economic chapter' as Indonesia free-trade agreement begins

The landmark trade agreement is expected to give an export boost to farmers and businesses who have been doing it tough during the COVID-19 pandemic.

Trade Minister Simon Birmingham said the free-trade agreement (FTA) was the start of a "new economic chapter" between the two countries.

"This is the most comprehensive bilateral trade agreement Indonesia has ever signed, and will give our exporters a competitive edge in what is one of the fastest growing economies in the world," Mr Birmingham said.

"With a population of over 260 million and a growing middle-class, Indonesia presents huge opportunities for our exporters across a range of sectors including agriculture, education, tourism, energy and mining services."

The FTA has a number of "major wins across the board" for farmers, with lower tariffs and improved access for grains, live cattle and meat, dairy and horticulture.

"For example, our grains growers will now be able to export 500,000 tonnes of feed grains including wheat and barley into Indonesia tariff free," Mr Birmingham said.

"This will provide a significant boost for the Australian grains industry, building on our substantial milling wheat exports."

The Indonesian FTA also coincides with the federal government's $240 million support package for international exporters, which will help keep international freight routes and flights operating.

The temporary program has already helped secure carriage of more than 36,000 tonnes of exports to 50 key international destinations.

"With international travel restrictions expected to remain in place for the foreseeable future, our exporters and key importers will continue to face significant barriers," Mr Birmingham said.

"These freight flights have been critical to getting produce out the door during these tough times and helping to keep our exporters in business and connected to their hard-won established global customers."

Agriculture Minister David Littleproud said the freight support was a major win for Australian farmers.

"We're backing our farmers by making sure they can continue to get more of their high-quality product into overseas markets," Mr Littleproud said.

"Keeping our farmers connected with their established international customers will help them keep their operations going so they can keep producing a top quality export product and enhance their reputation as a reliable partner."