"I believe the relations would remain good as Indonesia has issued statement, which I think has made clear the position of Indonesia," Luhut said here on Wednesday.
He said Indonesia will continue to respect international law including UNCLOS 1982, and at the same time Indonesia is determined to maintain good relations with China.
Luhut has had a number of meetings with President Joko Widodo (Jokowi) and Foreign Minister Retno LP Marsudi on tension in South China sea.
Tension is feared to mount in South China Sea after the Permanent Arbitration Court in the Hague declared Chinese territorial claim in South China Sea as groundless.
The arbitration court said Chinese claim of historical right over groups of small islands in South China sea had been annulled with the exclusive economic zones of a number of countries in the regions mainly the Philippines, Vietnam and Malaysia.
The decision of the Arbitration Court was announced on protest lodged by the Philippines over control of the Spratly islands in the South China Sea.
China, however, maintained it would not acknowledged the Arbitration Court decision.
China has been reported building a new island over reef to be used as military base.
Indonesia, which has no territorial claim in South China sea, has called on all parties involved to seek peaceful settlement to the dispute.
The country already has friction with China after incident when Indonesia maritime authorities detained a Chinese fishing vessel operating in Indonesias exclusive economic zone off Natuna in border area of South China sea.
China claimed its fishing boat operated in Chinas traditional fishing ground.