Indonesian ambassador Nadjib Riphat Kesoema has returned to Australia six months after being recalled after a spying row between the neighbours.

Indonesia’s ambassador has returned to Australia, the first major sign that tensions could be easing between Canberra and Jakarta since spying revelations broke late last year.

Nadjib Riphat Kesoema was recalled six months ago by a furious President Susilo Bambang Yudhoyono after it emerged Australia had spied on the president, his wife and inner circle.

A spokeswoman for Foreign Minister Julie Bishop on Monday confirmed the ambassador was back in Australia.

“This is part of the process of resolving the issues that we inherited from Labor,” she told AAP.

His return is the first significant sign of a thaw in diplomatic tensions between Australia and Indonesia since President Yudhoyono suspended normal co-operation on high-level issues in late November.

Indonesia demanded Australia sign a code of conduct before the two countries start working together on people smuggling, defence and intelligence sharing.

It’s not clear if the ambassador’s return signals ground has been made on the protocol, with Ms Bishop’s office not offering a comment.

Ms Bishop sent a draft proposal of the code to her Indonesian counterpart Marty Natalegawa in December, but an agreement has not yet been finalised.

President Yudhoyono has said he hoped the deal could be done by August, and the rift between the two countries could be resolved.

The ambassador has been making more frequent trips to Canberra as negotiations on the code of conduct have progressed, but AAP confirmed in May the president had asked him to return for good.

It’s believed no date has been set yet for the next meeting on the code.

But Ms Bishop’s office recently told AAP the next opportunity would be a bilateral 2+2 dialogue between the foreign and defence ministers of Australia and Indonesia.