Former Australian Prime Minister Malcolm Turnbull warned on Monday that the transfer of his country's embassy in Israel from Tel Aviv to Jerusalem could upset Indonesia, following talks with Indonesian President Joko Widodo.

Speaking on the sidelines of a conference in Bali, Turnbull said Widodo had directly raised his concerns with him and "there's no question that were that move to occur, it would be met with a very negative reaction in Indonesia. This is after all the largest majority Muslim country in the world so we have to be very clear-eyed about that."