"By 2050, it'll be in the top four economies," he said.
"At the moment the big weakness for us is we've got to get the trade, investment, business, commercial presence right and deeper, and expand on all of the potential opportunities we have.
"Over our lifetime, the fulcrum of the economic balance will change from our economy being bigger to Indonesia's economy being bigger.
"At 2050, when they're the top four economy in the world, we'll potentially be struggling to be in the G20 because other countries from Africa and Asia have overtaken us.
"So unless we're doing all the hard work now, the danger we run is that when we are economically inferior … if we haven't put the quality work in now, then we'll suffer as a consequence."
Also speaking at the CEDA event, Department of Foreign Affairs and Trade, South East Asia Maritime Division Assistant Secretary, David Binns, said "the business relationship (between Australia and Indonesia) is underdeveloped.
"Indonesia has been our 12th largest trading partner. A country of that size and that close ought to be well up in the top 10.
"We need to do more to ensure a wider range of (the) Australian community is familiar with Indonesia.
"If we don't get it right I think the risk is that we won't make as much as we could of the business relationship and we won't make as much as we could of the government to government relationship as well."