Subject: GS 2: International Relations
Context: The Prime Minister of India visited Indonesia to strengthen the Comprehensive Strategic Partnership (CSP) between the two countries.
- The visit focused on enhancing cooperation in trade, defence, maritime security, digital economy, clean energy, healthcare, education, and Indo-Pacific cooperation.
- Prime Minister Narendra Modi and Indonesian President Prabowo Subianto inaugurated a joint India–Indonesia conservation project at the Prambanan Temple Compounds, a United Nations Educational, Scientific and Cultural Organization World Heritage Site in Yogyakarta.
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Key Outcomes of Visit
| Initiative |
Details |
| Digital Public Infrastructure (DPI) Cooperation |
Indonesia launched the Indonesia Open Network (ION), inspired by India’s Open Network for Digital Commerce (ONDC) architecture, marking the export of India’s Digital Public Infrastructure model. |
| Strengthening Maritime Security Cooperation |
Indonesia will post a Liaison Officer at the Information Fusion Centre–Indian Ocean Region (IFC-IOR) in Gurugram to improve maritime domain awareness, intelligence sharing, and regional security coordination. |
| Collaboration in Heritage Conservation |
India will extend technical expertise for the conservation and restoration of the Prambanan Temple Complex in Yogyakarta, Indonesia’s largest Hindu temple complex. |
| Enhancing Cultural and Educational Diplomacy |
Both countries declared 2026–27 as the Tagore–Dewantara Year of India–Indonesia Cultural and Educational Diplomacy to commemorate the centenary of Rabindranath Tagore’s visit through year-long cultural and academic exchanges. |
| Cooperation in Electoral Management |
The Election Commission of India (ECI) and Indonesia’s General Elections Commission (KPU) signed an agreement to exchange best practices in conducting large-scale democratic elections and strengthening electoral institutions. |
| Expanding Higher Education Cooperation |
India and Indonesia agreed to establish an overseas campus of IIM Bangalore at the Singhasari Special Economic Zone (SEZ) in East Java, deepening collaboration in management education and capacity building. |
| Agriculture and Food Security |
A comprehensive MoU on Agriculture and Allied Sectors was concluded to enhance cooperation in agriculture and food security.
India also announced the supply of 100 tonnes of DWR-162 high-quality wheat seeds to support Indonesia’s agricultural productivity. |
| Health and Disaster Resilience |
India and Indonesia signed an MoU between CDSCO and Indonesia’s drug regulatory authority to harmonise medical product regulations, alongside an agreement on health workforce collaboration.
An MoU between NDMA and Indonesia’s disaster management agency was also signed to strengthen cooperation in disaster preparedness, response and capacity building. |
| Space Cooperation |
The Framework Agreement on Cooperation in the Exploration and Peaceful Uses of Outer Space was extended. Additional MoUs were signed to promote collaboration in research, technology and innovation, as well as next-generation telecommunications technologies. |
| Defence and Maritime Security |
Indonesia signed a USD 200 million contract to procure two batteries of the BrahMos supersonic cruise missile system and placed the first-ever export order for India’s Astra air-to-air missile, strengthening India’s defence exports and the Make in India initiative. |
Challenges
- Trade Imbalance: India imports large quantities of coal, palm oil and minerals from Indonesia, resulting in a persistent trade deficit.
- Example: The Ministry of Commerce has highlighted the need to diversify India’s exports to Indonesia.
- Limited Trade Diversification: Bilateral trade remains concentrated in a few commodities, making economic ties vulnerable to global price fluctuations and export restrictions.
- Example: Government of India and the Indian Embassy in Jakarta have identified pharmaceuticals, IT, automobiles and engineering goods as sectors with untapped potential.
- Underutilised Investment Potential: Despite strong political ties, bilateral investments remain below potential in sectors such as infrastructure, mining, renewable energy and the digital economy.
- DPIIT and the India–Indonesia CEOs Forum have called for greater private-sector investment.
- Maritime Security Challenges: Piracy, illegal fishing, maritime terrorism and transnational crimes in the Andaman Sea and Malacca Strait require deeper operational cooperation and maritime domain awareness.
- India and Indonesia have extended the MoU on Maritime Safety and Security Cooperation to strengthen coordination.
- Strategic Balancing with China: Indonesia’s ‘Bebas Aktif’ (Free and Active) foreign policy and its extensive economic engagement with China sometimes constrain the pace of strategic cooperation with India, particularly in the Indo-Pacific.
- Limited Defence Industrial Cooperation: Defence ties have historically been limited to exercises and training, with relatively few joint manufacturing or technology-transfer projects.
- Example: The recent BrahMos missile export and Astra missile agreement are significant steps but broader defence collaboration remains a work in progress.
- Connectivity and Logistics Gaps: Direct shipping routes, air connectivity, port linkages and supply-chain integration remain inadequate, increasing logistics costs and limiting trade growth.
- Example: India has proposed greater connectivity through the Sabang Port and the Andaman–Aceh maritime corridor.
- Low People-to-People Exchanges: Tourism, academic collaboration, cultural exchanges and business interactions remain below potential despite shared civilisational and historical links.
- Example: Government initiatives under the ASEAN-India Plan of Action seek to expand educational, cultural and youth exchanges.
Strategic Significance of India–Indonesia Ties
- Gateway to the Indo-Pacific: Indonesia sits at the junction of the Indian Ocean and Pacific Ocean, making it a pivotal partner for India’s Indo-Pacific strategy and regional maritime connectivity.
- Maritime Security and Sea Lane Protection: Both countries cooperate to secure critical Sea Lines of Communication (SLOCs), especially around the Strait of Malacca, through which nearly 40% of global trade and a majority of India’s East Asian trade passes.
- Countering China’s Expanding Influence: Stronger India–Indonesia cooperation supports a free, open and rules-based Indo-Pacific, balancing strategic competition in the region and strengthening ASEAN centrality.
- Defence and Strategic Partnership: Growing defence cooperation, including maritime exercises, defence exports (e.g., BrahMos missile deal), naval visits, and capacity building, enhances regional security architecture.
- Economic and Supply Chain Resilience: Indonesia is India’s largest trading partner in ASEAN and a major source of critical minerals such as nickel, supporting India’s electric vehicle and steel industries while diversifying supply chains.
- Energy and Resource Security: Indonesia is a reliable supplier of coal, palm oil, LNG, and critical minerals, contributing significantly to India’s energy and food security.
- Act East Policy and ASEAN Engagement: Indonesia is India’s maritime fulcrum for implementing the Act East Policy and deepening engagement with Association of Southeast Asian Nations in political, economic, and security domains.
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Way Forward
- Deepen Comprehensive Strategic Partnership: Implement the Vision of the India–Indonesia Comprehensive Strategic Partnership (2025–2029) through regular summit-level engagements and institutional dialogues.
- Strengthen Maritime and Defence Cooperation: Expand joint naval exercises, maritime domain awareness (MDA), coast guard cooperation, and defence industrial collaboration, including co-production and defence exports.
- Enhance Connectivity: Improve air, sea, and digital connectivity, particularly by developing the Andaman & Nicobar Islands–Aceh maritime corridor to boost trade and tourism.
- Expand Trade and Investment: Diversify bilateral trade beyond coal and palm oil by promoting investments in pharmaceuticals, automobiles, renewable energy, digital economy, and manufacturing.
- Build Critical Mineral Partnerships: Develop long-term cooperation in nickel, bauxite, tin, and other critical minerals to support India’s EV, battery, and clean energy ambitions.
- Promote Blue Economy Cooperation: Collaborate in sustainable fisheries, marine conservation, coastal resilience, marine biotechnology, and ocean-based renewable energy.
- Strengthen ASEAN and Indo-Pacific Cooperation: Coordinate closely through ASEAN, the East Asia Summit (EAS), Indian Ocean Rim Association (IORA), and the Indian Ocean Naval Symposium (IONS) to uphold a free, open, inclusive, and rules-based Indo-Pacific.
- Expand People-to-People and Cultural Exchanges: Increase tourism, academic partnerships, skill development, Buddhist and Ramayana cultural circuits, and youth exchanges to strengthen long-term bilateral goodwill.
Conclusion
By leveraging their shared maritime geography, economic complementarities, and strategic convergence in the Indo-Pacific, India and Indonesia can build a resilient, future-oriented partnership that advances regional peace, prosperity, and sustainable development.
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India–Indonesia: Common Membership in Major Multilateral Groupings
| Grouping |
India |
Indonesia |
Strategic Relevance |
| United Nations |
Member |
Member |
Global peace, security and sustainable development |
| Group of Twenty |
Member |
Member |
Global economic governance and financial stability |
| World Trade Organization |
Member |
Member |
Rules-based international trading system |
| Non-Aligned Movement |
Member |
Member |
South-South cooperation and strategic autonomy |
| East Asia Summit |
Member |
Member |
Indo-Pacific strategic dialogue and regional security |
| ASEAN Regional Forum |
Member |
Member |
Political and security cooperation in the Asia-Pacific |
| Indian Ocean Rim Association |
Member |
Member |
Maritime security, Blue Economy and regional connectivity |
| Indian Ocean Naval Symposium |
Member |
Member |
Naval cooperation and maritime domain awareness |
| Asia Cooperation Dialogue |
Member |
Member |
Pan-Asian economic and developmental cooperation |
| Association of Southeast Asian Nations |
Comprehensive Strategic Partner |
Founding Member |
Core platform for India’s Act East Policy |
| Asia-Pacific Economic Cooperation |
Not a Member |
Member |
Asia-Pacific trade and investment cooperation |
9 Jul 2026
