Australia and Indonesia will sign a defence treaty that commits the two nations to regularly consult on security matters.

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Prime Minister Anthony Albanese and Indonesian President Prabowo Subianto announced the agreement on Wednesday.

The deal is a "major extension" of the strong relationship between the two nations, Mr Albanese said, while at the Royal Australian Navy Base at Garden Island in Sydney.

"This is a watershed moment in the Australia-Indonesia relationship," he said.

Under the pledge, the two countries will consult at a leader and ministerial level on a regular basis, and if either country's security is threatened, consider what

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