India and Indonesia Collaboration

General Studies Paper -2 

Context: India and Indonesia agreed to enhance collaboration in areas of defence industry, maritime security and multilateral cooperation.

About the collaboration

• Historical Linkages: India and Indonesia share two-millennia old close cultural and commercial contacts.
  • The Hindu, Buddhist and later Muslim faith travelled to Indonesia from the shores of India.
  • The stories from great epics of Ramayana and Mahabharata form a source of Indonesian folk art and dramas.
  • The famous Bali Yatra, a week-long festival, is celebrated with a great deal of fervour and gaiety in both India and Indonesia.
  • Political Relations: The struggle against colonial powers, democratic traditions, pluralist culture, and progressive leadership are some of the common strands connecting India and Indonesia.
  • President Sukarno of Indonesia was the Guest of Honour during the first Republic Day of India in 1950.
  • Independent India and Indonesia became chief votaries of independence of Asian and African countries, the spirit of which led to historic Bandung Conference of 1955 and later formation of Non-aligned Movement in 1961.
  • Since the adoption of India’s ‘Look East Policy’ in 1991, and its upgradation to ‘Act East’ in 2014, there has been a rapid development of bilateral relations in political, security, defence, commercial and cultural fields.
  • India and Indonesia have a Comprehensive Strategic Partnership and have arrived at a shared vision of the Indo-Pacific.
• Commercial Relations: Indonesia has emerged as India’s largest trade partner in the ASEAN region.
  • The Total Bilateral Trade during the fiscal year 2022-23 was USD 38.85 Billion (growth of 48% from last FY) with USD 10.02 Billion (18% growth) worth export and USD 28.82 Billion (62% growth) worth imports.
  • India is the second largest buyer of coal and crude palm oil from Indonesia and imports minerals, rubber, pulp and paper and hydrocarbons reserves.
  • India exports refined petroleum products, commercial vehicles, telecommunication equipment, agriculture commodities, bovine meat, steel products and plastics to Indonesia.
  • Indonesia is an attractive destination for Indian investment
  • In the defence sector, both countries have been working closely and organized Samudra Shakti, a bilateral maritime exercise, and Garuda Shakti, a joint military exercise, every year.

Recent Developments

• The first-ever “India-Indonesia Defence Industry Exhibition-cum-Seminar” was organised in Jakarta by the two countries as they marked the 75th year of establishment of diplomatic ties.
• Indonesia is also keen to build its own defence industry and offered to share India’s experiences in this regard and also to partner for long-term collaborations in the defence sector.
• The Society of Indian Defence Manufacturers (SIDM), and Pinhantanas, Indonesia’s national private defence industry association will sign a memorandum of understanding (MoU) to promote and strengthen the defence industry partnership between the two countries.

Future Outlook

• India and Indonesia had civilizational connections for more than two thousand years. Both countries being maritime neighbours and strategic partners have important and close relations.
• In current times, this partnership is characterised by close cooperation in bilateral and multilateral arena, including frequent high-level interactions,”
• Indonesia is an important partner in India’s Act East Policy and the Indo-Pacific region.
  • The two countries have the huge potential to grow further in the coming years with increasing bilateral and community relations.