In the preceding month, Indonesia witnessed a change of guards from the outgoing president Joko Widodo to that of the former army general Prabowo Subianto, and recent media reports suggest that India might extend an invitation to the newly elected Indonesian President to grace the Republic Day Celebrations as the Chief Guest for this year opening pathways for reinforced bilateral ties between both the nations. Indonesia,a nation characterized by its secular governance and democratic framework -albeit one that has experienced a democratic regression in recent years, finds itself at the focal point of a strategic courtship by both China and the US while continuing to maintain a non aligned stance. There are several compelling factors that position this state at a pivotal geopolitical swing state.
Firstly, Indonesia spreads its control over a network of key maritime passages linking the Indian and Pacific Ocean including the strategically important Malacca strait, Sunday, Lombok Ombai-Wetar and Timor. These waterways are inalienable passageways for an estimated 60% global of the global maritime commerce with only the Ombai-Wetar and Timor Straits possessing enough depth to facilitate the stealthy transit of nuclear submarines.
With twice India’s per capita income and boasting a demographic profile with approximately a quarter of the population below 15 years of age , Indonesia is at a very beneficial position facing the demographic window. The Indonesian economy is the fastest growing digital economy in Southeast Asia and the country is rich in key mineral reserves imperative for the global green technology transformation. Indonesia’s strategic significance is monumental and is only likely to expand .
This growth has catalysed the influx of multi-billion dollar of Foreign Direct Investments from countries like China in projects ranging from mineral processing facilities to high speed railway networks. But it is important to note that, despite being one of the foremost beneficiaries of the Belt & Road Initiave, the Indonesian popular opinion about China isn’t very positive. Nevertheless, owing to their economic entanglements with China, none of the ASEAN nations seem inclined to severe their diplomatic ties with China in favour of the United States which in turn would lead to significant cuts in their GDP’s.
In order to bring the economic reinvigoration back to 7% which Indonesia had witnessed during the corrupt military regime of Suharto – which met an ignominious demise with the financial crisis of 1997, the former President Joko Widodo emphasized massively on 200 infrastructure projects ranging from ports to power plants, though his grandest ambition the new capital city of Nusantara bears the potential risk of turning out to be an underutilised investment or “white elephant”.
Prabowo’s economic trajectory remains ambiguous as well , particularly he has promised a mid day meal programme valued a $30 billion annually to enhance his public persona and a few billions for the new Nusantara city to be in the good books of Jokowi.
