He made the remarks in a meeting with Indonesian Vice-President Muhammad Jusuf Kalla on the sidelines of the 13th Summit of the Organization of Islamic Cooperation (OIC) in the Turkish city of Istanbul.
The ground is ready for enhanced ties between Iran and Indonesia after removal of anti-Iran sanctions and resumption of banking ties, the President added.
He called the relations between Tehran and Jakarta were on the rise and urged cementing all-out ties particularly in the field of economy.
Iran and Indonesia have good potentials for expansion of ties in the fields of energy, industry, tourism, science, research, etc., Rouhani added.
He also urged the private sectors of the two countries to boost their ties.
The President praised Indonesia for its efforts in supporting the Palestinian nation and said realization of Palestinian nation's rights is a must for regional stability.
Rouhani called Iran-Indonesia cooperation for resolution of regional issues and fighting terrorism and extremism necessary.
He referred to catastrophic results of manipulation of terrorism as a political tool by certain western states and said unfortunately, some regional countries too are also trying to use terrorists for political purposes.
Indonesian vice president for his part congratulated the end to Iran's sanctions after successful talks with P5+1 and said the nuclear deal paved the way for using potentials for expansion of ties.
Tehran and Jakarta share similar views towards establishment of peaceful relations between Islamic states, and both Iran and Indonesia believe in cultural fight for elimination of root causes of terrorism and extremism, he added.
Indonesia vice president said that big Islamic countries and international organizations like OIC should have a more active role in the fight against terrorism and extremism.
He underlined development of cooperation and joint investment between the two states in various fields including energy, culture and education.
The official also said that Indonesian president will pay a visit to Iran in the near future.
President Rouhani arrived in Istanbul Wednesday night.
By IRNA
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