The Minister for Foreign Affairs, Senator Bob Carr has announced that Australia will provide up to $100 million over five years to help build Indonesia's research capacity and study the impact of development assistance in alleviating poverty.


Senator Carr said the funding would give Indonesia extra intellectual firepower to lift millions more people out of poverty.


Examples of research could include promoting policies to ensure all children get vaccinated and women have access to midwives during childbirth.


A woman in Indonesia is 30 times more likely to die in childbirth than a woman in Australia.


"New research for better policy will reinforce Indonesia's social and economic progress," Senator Carr said.


"Policy-makers stand to benefit from more precise, timely and independent evidence about what works and what doesn't."


"This funding will build the next generation of Indonesia's anti-poverty think-tanks."


"And more importantly, millions more people will benefit from better access to basic health, education and social welfare services."


Australia will provide grants and technical help to 17 think-tanks and research institutions to boost links between their analysis and the practical needs of government.


An expert panel will be formed this year to consider new ideas and start funding research institutions by early 2013.