By Karishma Vaswani
BBC News, Jakarta
**Indonesia says it understands why US President Barack Obama had to cancel a historic visit to the world’s most populous Muslim nation.**The archipelago was due to play host to the US leader next week.
The trip was being hailed by both sides as a momentous opportunity to cement their relationship on security, trade and military issues.
Mr Obama spent four years in Jakarta as a young boy and this has added to his appeal amongst the Indonesian people.
Indonesia’s presidential spokesman, Dino Djalal, says the Indonesian leader Susilo Bambang Yudhoyono had predicted Mr Obama would cancel his trip because of the healthcare bill.
Mr Djalal says when the US president called his Indonesian counterpart to discuss postponing the trip, it was in fact Mr Yudhoyono who suggested that the visit should take place in June.
Mr Obama has decided to stay in Washington to work on the controversial healthcare bill which is due to be voted on this Sunday, the same day he was expected to leave for his Asia-Pacific visit.
He had also been scheduled to visit Guam and Australia on the same trip.
The trip was being seen as a crucial push for influence in this region by the United States, to counteract the growing reach of China in Asia.
Indonesia is South East Asia’s largest economies and a growing market - one that American firms are keen to get into.
There were hopes that significant initiatives on trade and investment would have been signed during the American president’s visit to the country he lived in as a child.
Chinese Premier Wen Jiabao is due to visit Indonesia in April, a trip that is likely to discuss further cooperation on trade.
China signed a free trade agreement with the Asean bloc which came into effect earlier this year, and is increasingly becoming a key economic partner for many of the nations in Asia.