INDIA WITH INDONESIA : ON ANCIENT TIES TO NEW PHASE

28th January, 2025

Context

Indonesian President Prabowo Subianto visited India as the chief guest at the Republic Day parade. The visit highlighted the historical ties between the two countries.

Ancient Ties and Shared Cultural Heritage

India and Indonesia share deep-rooted connections built over centuries of trade and cultural exchanges. These ties rest on trade, travel and spread of Javanese Hinduism. Both countries used Vedic scriptures and Sanskrit texts. These cultural exchanges created a formidable bond between them.

Solidarity Against Imperialism

In the 20th century, India and Indonesia stood together against imperialism. India supported Indonesia’s fight against Dutch colonialism. Prime Minister Jawaharlal Nehru banned Dutch overflights. He also sent Indian planes to evacuate the Indonesian Prime Minister and Vice President. Indonesia’s first President Sukarno expressed gratitude for India’s help in an article in The Hindu in 1950.

Shared Ideology: Non-Alignment and Economic Cooperation

India and Indonesia were united in non-alignment. Both countries resisted great power politics. They played key roles in forming the Non-Aligned Movement (NAM) at the Bandung Conference. Both countries are large, diverse and share a focus on religious tolerance and equitable development. These commonalities forged strong ties between them.

Common Geopolitical Concerns and Recent Developments

India and Indonesia share common concerns. They worry about Western sanctions, U.S.-China rivalry and China’s aggression in the Indo-Pacific. They also face issues related to food, fertilizer and fuel security. Their collaboration in the G-20 summits in Bali (2022) and Delhi (2023) was significant. Indonesia’s inclusion in BRICS marks a new phase in their relationship.

Five MoUs and Defence Cooperation

The announcements during President Subianto’s visit were modest. Five MoUs were signed. These cover health, traditional medicine, maritime security, digital development and cultural cooperation. The joint statement emphasized strengthening defence cooperation. However, there was no progress on key projects like the sale of Brahmos missiles, the Sabang port, or the Aceh-Andamans connectivity.

The Road Ahead: Forging the Next Phase of Ties

President Subianto’s visit marks the 75th anniversary of relationsand it is an important step toward strengthening our bilateral ties.

INDIA INDONESIA RELATIONS: A FURTHER DETAILED ANALYSIS

Historical and Cultural Foundations

The relationship between India and Indonesia has deep roots that trace back to the 2nd century BCE. Evidence of trade and cultural exchanges is abundant. The two countries share a strong cultural bond shaped by the epics Ramayana and Mahabharata. These epics influenced Indonesian folklore, music, dance and theater. Hindu-Buddhist culture left a lasting imprint on the region. The rise of the Srivijaya and Majapahit empires led to the construction of iconic temples such as Borobudur and Prambanan. The Kalinga region in India historically maintained trade links with Indonesian islands like Java Sumatra Borneo and Bali enriching both cultures.

Political Ties and Diplomatic Engagements

India and Indonesia share a history of colonial experiences and a mutual commitment to democracy and pluralism. The ties were solidified when Indonesia’s first president Sukarno graced India’s first Republic Day celebrations in 1950. Both nations were instrumental in the Bandung Conference of 1955 and have collaborated extensively within the Non-Aligned Movement in 1961. India’s Act East Policy that was launched in 2014 aligns with Indonesia’s vision of becoming the Global Maritime Fulcrum. This alignment strengthens their foreign policies in the Indo-Pacific.

Growing Economic Partnership

Indonesia stands as one of India’s largest trade partners within the ASEAN region. Bilateral trade reached USD 38.8 billion in 2022–2023. Both countries have expressed a shared interest in resolving outstanding trade barriers related to tariffs and non-tariff measures. A review of the ASEAN-India Trade in Goods Agreement (AITIGA) is set to conclude by 2025. India and Indonesia signed a MoU on Local Currency Settlement Systems between their central banks.

Strategic and Defense Cooperation

The Comprehensive Strategic Partnership signed in 2018 marks a significant milestone in defense, trade and maritime cooperation. India and Indonesia share a common vision on maritime security particularly in the Indo-Pacific region. Joint defense exercises like Ex Garuda Shakti (Army) and Ex Samudra Shakti (Navy) are conducted regularly. Both nations also participate in multilateral defense exercises including Milan Komodo and Super Garuda Shield. A crucial White Shipping Information Exchange Agreement has been established to enhance maritime security.

Collaboration in Key Areas: Energy, Infrastructure and Technology


India and Indonesia are exploring joint ventures in energy security with particular emphasis on critical minerals like nickel bauxite and silica. One notable project is BPCL's $121 million investment in the Nunukan Gas Block in Indonesia. Both nations are committed to strengthening infrastructure and connectivity, exemplified by the expanded Air Services Agreement. This facilitates increased trade plus tourism. In science and technology, India’s ISRO collaborates with Indonesia’s BRIN for space research and tracking. Initiatives like the Biak Telemetry and Tracking Agreement reflect this collaboration.

Climate Change and Disaster Resilience

Both countries have united in the fight against climate change. Indonesia is an active member of the Coalition for Disaster Resilient Infrastructure (CDRI). Indonesia has also joined India’s initiatives like the International Solar Alliance and the International Big Cat Alliance. The nations are focused on bolstering disaster management capacities through mutual cooperation and knowledge sharing.

Multilateral Cooperation and Regional Influence

India and Indonesia are key proponents of the Global South within the UN and G20. They advocate for South-South cooperation. They continue to strengthen their partnership within ASEAN, particularly in the Blue Economy. Indonesia’s membership in BRICS has been welcomed by India further boosting regional cooperation. India as well as Indonesia actively contribute to regional stability and economic growth in the Indian Ocean Rim Association (IORA).

Challenges in Bilateral Relations

Despite the strong partnership, challenges remain. Indonesia continues to enjoy a trade surplus with India, largely driven by exports of coal and palm oil. Plus, regulatory hurdles such as complex permits, quotas and non-tariff measures pose challenges to smoother trade. Logistical constraints and infrastructure bottlenecks hinder deeper economic integration between the two nations. Geopolitical factors, especially the growing influence of China in the Indo-Pacific, require both countries to collaborate closely on regional security and stability.

Conclusion

India and Indonesia’s partnership is built on a solid and rich historical legacy and it is evolving into a more robust strategic and economic alliance with time. The future holds promising avenues for collaboration in sectors like the blue economy, maritime security and digital technologies. By addressing trade imbalances, streamlining joint ventures and fostering greater cultural exchanges the countries can enhance this partnership. This will benefit their people and contribute to the prosperity and peace of the broader Indo-Pacific region.