Indonesia says reports of Australian spying 'mind-boggling'

Indonesia has been embroiled in trade disputes with the US over its exports of clove cigarettes and shrimp in recent years, and has lashed out at Canberra over previous allegations that it spied on the Indonesian president and other top officials.

"I find that a bit mind-boggling and a bit difficult how I can connect or reconcile discussion about shrimps and how it impacts on Australia's security," Natalegawa told reporters, referring to claims made in a weekend report by the New York Times.

The report said Australia offered intelligence to the US National Security Agency (NSA) to give Washington leverage during a trade dispute with Jakarta.

Natalegawa's comments came during a joint press conference with US Secretary of State John Kerry, who responded to questions about the report, saying: "We take this issue very seriously, which is why President Obama laid down a series of concrete and substantial reforms."

The report, based on leaked documents by former NSA analyst Edward Snowden, said that the Australian Signals Directorate offered the NSA information "including communications between Indonesian officials and the American law firm" that was representing Jakarta in the trade dispute.

Australian Prime Minister Tony Abbott defended Sunday his government's use of intelligence material, but refused to confirm the allegations made in the New York Times.

However, Abbott said that Australia did not "use anything that we gather as part of our ordinary security and intelligence operations to the detriment of other countries".

"We use it for the benefit of our friends. We use it to uphold our values," he said.

"We use it to protect our citizens and the citizens of other countries, and we certainly don't use it for commercial purposes," he said.