It is not surprising that Australian naval vessels have crossed into Indonesian waters in the course of implementing the Abbott government's Operation Sovereign Borders.

After all, the maritime boundary between our two countries is just an imagined line on the water. Despite modern satellite location technology, it must be extraordinarily difficult for ships charged with dealing with asylum-seeker boats to avoid crossing it. The admission this week that our navy has done this was therefore almost inevitable.

It will also not be surprising if this greatly annoys Indonesia. Unauthorised border incursions are serious matter for any country and these ones happened in a context of serious diplomatic tension. Regardless of Canberra's spin to the contrary, Indonesia has repeatedly and consistently stated for the past 12 months that it was unhappy with Australia turning boats back into its waters.

Whatever its rights and wrongs, the Indonesian position has long been clear. It is unlikely to change now, given the suspension of cooperation on people smuggling, military and intelligence matters in the wake of the revelations that Australia tapped the mobile phones of President Yudhoyono, his wife and members of their inner circle. Indonesia will not accept the Australian navy crossing the border without its prior consent.

It needs to be understood that, as I have written before, this is not all about us, or even about people smuggling.

Indonesia has always been extremely sensitive about its maritime sovereignty.

It is a sprawling archipelago of more than 17,400 islands, with one of the longest coastlines in the world, and its sea borders have often been contested by its neighbours.

Clearly, Indonesia needs large and well-equipped navy and air force to ensure the integrity of its borders but paradoxically it has neither. Its long-running neglect of these services dates back decades. It can be traced, in part, to the army's view that they were aligned with the Left in the 1960s, and thus ideologically suspect.

In any case, both the navy and airforce have been underfunded and poorly equipped since then – even by comparison to its army, which, on a per capita basis, is one of the smallest and most poorly funded in Asia. On its own assessment, the Indonesian navy probably only has around 25 working, seaworthy ships available for operations at any one time, and it has no coastguard.

Indonesia's very obvious strategic sea defence weakness is one reason why it has been so reluctant a partner with Australian in our efforts to stop people smuggling. It simply lacks the practical capacity to do much about it.

This all means that, for Jakarta, a political response to any perceived threat to the integrity of its sea borders is often its first and last line of defence. This makes the Indonesian government very sensitive about these issues and it often reacts quickly and strongly. It has, for example, even refused to allow US naval vessels to enter its waters in the Straits of Malacca to escort commercial cargo.

An angry response to our border incursions is even more likely now, with Indonesia – like Australia last year – in election mode. The generally rational policy making that marked the Yudhoyono administration is now largely on hold, probably till the end of the this year when a new president is sworn in.

Yudhoyono is already considered a lame duck in Indonesia, and his government's real power diminishes daily. His previous warmth towards Australia, which often helped resolve bilateral tensions in the past, is now of little account.

As in Australia, issues of national sovereignty and border integrity play well in election campaigns. Put this together with the fact that Indonesia won its independence in 1949 only after a bloody war against white colonisers (the Dutch), and you can see why many ordinary Indonesians will react badly to the border incursions.

Thankfully, Australia has already begun to do the right thing, apologising to Indonesia. Foreign Minister Bishop, Immigration Minister Scott Morrison, and our ambassador in Jakarta are all said to have explained to their Indonesian counterparts that the incursions were accidents. Let's hope there are also high-level conversations taking place off the record too. The government needs to do all these things, and will probably have to do more of them in the days ahead.

Our bilateral relationship with Indonesia is fraying, and is at its lowest point since East Timor. An agreed "road map" is in place to normalise relations, but this will require many months. Until then, we are on probation, and incidents such as these are very damaging for that process.

Mark Latham is reported as saying recently that Indonesia is only a "bit player" and a country that "Australia should keep at arms length". He could not be more wrong.

For all its many problems, Indonesia is a rising power – economically and politically – and knows it. It can survive without us, but is the opposite true?

Indonesia is the key to our security, the gateway to our northern borders and largely determines whether we are heard at the summit tables in Asia that will be so important during the Asian Century – particularly the Association of South East Asian Nations. As a block the members of ASEAN are already one of our largest trading partners, and Indonesia dominates ASEAN.

We should be more worried about whether Indonesia decides it will keep us at arms length.

Professor Tim Lindsey is director of the Centre for Indonesian Law, Islam and Society at the University of Melbourne.

Face It, We Cannot Afford To Keep Offending Indonesia