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Singapore is to fix the price of sand used in the construction industry after Indonesia banned all exports to its city-state neighbour.
Officially Indonesia has said the ban is due to environmental concerns, but some believe it is politically driven.
A Singapore newspaper reported that it had been told that the ban was due to a difference over an extradition treaty.
Singapore is one of the largest importers of Indonesian sand, which is used to make concrete.
'Counter-productive'
Singapore Foreign Minister George Yeo has said that, if true, Indonesia's suggestion that the ban was in protest over delays to an extradition treaty, was "unfortunate and counter-productive".
Map of Singapore
The two countries are separated by the Strait of Singapore
The comments were reported to have been made by an Indonesian official.
Mr Yeo added that negotiating the first extradition treaty between the two nations was not easy.
Indonesia has been pushing Singapore for an extradition treaty which Jakarta says is vital in its fight against corruption.
The Indonesian government alleges that many suspects wanted in Indonesia on corruption charges have simply fled to Singapore.
Jakarta has previously banned the export of sea sand to Singapore, which is used in land reclamation.
Singapore is now fixing the price of sand to curb any inflationary pressures as importers have to switch to alternative sources.
