Australia has signed a face-saving “code of conduct” with Indonesia, which commits the two countries to not using intelligence to “harm” the other. The move has been welcomed by both sides of politics and drawn a line under the rift caused by last year’s revelation in The Guardian that Australia had spied on the Indonesian president and his wife, among other senior officials.

The revelation was based on documents supplied by NSA whistleblower Edward Snowden and was handballed to The Guardian’s Australian outfit (and co-published by the ABC), which traded on it for weeks — sending a correspondent to Jakarta to cover the fallout from the perspective of Indonesia’s leaders.

But what was unclear at the time and remains so is why the story caused such outrage in Australia. The revelations concerned senior public officials, not ordinary citizens, of a country that has used armed force to expand its borders before — in the 1960s Indonesia violently seized West Papua; in the ’70s it did the same to East Timor. The Indonesian military is far larger than ours.

This is not to suggest that there is an imminent threat of invasion from Indonesia, but that not keeping a watching brief on the leaders of our powerful neighbour would be negligent of the Australian Signals Directorate, whose role is:

“To obtain intelligence about the capabilities, intentions or activities of people or organisations outside Australia … for the purposes of meeting the requirements of the Government, and in particular the requirements of the Defence Force.”

Of course, the central revelation of Snowden’s massive document drop was that the NSA routinely spies on ordinary foreign citizens who communicate with the United States. Crikey eagerly awaits a joint understanding with the US on a code of conduct on spying on Australian citizens.