As we learned from foreign minister Stephen Smith last night, there is now an agreement between the Prime Minister, Kevin Rudd, and Indonesia’s President Susilo Bambang Yudhoyono for Indonesia’s to accept asylum seekers bound for Australia. Move over John Howard’s “Pacific Solution”, and make way for Rudd’s “Indonesia Solution”.

Rudd will take considerable satisfaction from his visit, formally to mark Yudhoyono’s swearing in for a second term, producing what he will no doubt regard as a diplomatic coup.

Australia’s sometimes difficult relations with Indonesia are travelling fairly well at the moment, in large part due to Yudhoyono’s democratic reformist tendencies. That  Rudd is also comfortable with regional leaders, and has taken an active interest in Indonesia since at least 1997, further assists the relationship.

Smith hesitated to put a dollar figure on Australia paying for this new arrangement, but there is little doubt that funds will be diverted from existing humanitarian projects to help support Indonesia holding the asylum seekers.

Smith indicated this when he discussed the range of humanitarian projects that Australia currently supports in Indonesia, identifying the government’s new Indonesia Solution as also based on humanitarian principles.

The second “price” issue for Australia will be what diplomatic concessions will have been granted in order to secure Indonesia’s co-operation. In this, there is little doubt that the Lombok Treaty will have been invoked, in particular that part that refers to non-interference in Indonesia’s internal affairs.

For this, read that Australia has been told to butt out of any lingering concerns about the continuing abysmal human rights situation in West Papua and not to accept any further West Papuan refugees. Oh, and the Australian government might want to reconsider its approach to the Australian Federal Police investigation into the 1975 Balibo murders while we’re at it.

Australia, always more than a little obsequious to Indonesia, has prostrated itself even further.

Given that this Indonesia Solution reflects Australia’s much-vaunted humanitarian concerns, as a third issue, one wonders why Smith has put so little effort into the humanitarian crisis in Sri Lanka, which is pushing so many people into boats.

Not only has the predominantly ethnic Sinhalese Sri Lankan government won the war against its Tamil separatists, it is keeping a quarter of a million Tamils in concentration camps, from which outside access is barred.

The reports that do filter out from the camps tell of regular extrajudicial murders, rape and torture. And then there is the expropriation of tens of thousands of Tamils from their homes. The Palk Straights with India, too, are heavily patrolled, so the Indian Ocean and Australia is the safer option.

In short, the “sailing season” combined with “push” pressures in Australia’s part of the world have led to an increase in asylum seekers getting into boats. Compared to the early 1980s, however, and certainly by current international standards, the number of asylum seekers remains small. This, then, is not an issue of border control or illegal immigration, which is far more taxed at Australia’s airports.

The fourth, domestic political issue, then, is that the motivating factor for this Indonesia Solution is not the government’s supposed humanitarian concerns, but the “dog-whistle politics” of racism in the immigration debate.

Australia’s politicians arguing about who is the toughest on immigration is simply code for who will sink to this lowest common denominator.

Labor promised a more humanitarian approach to asylum seekers. What we now have is just a shift of its geographic focus.

Associate Professor Damien Kingsbury is with the school of International and Political Studies at Deakin University.