The January 2025 state visit of Indonesian President Prabowo Subianto to India, coinciding with the 75th anniversary of their diplomatic ties, marked a pivotal moment in India-Indonesia relations.

As the Chief Guest at India’s 76th Republic Day celebrations, President Subianto’s visit brought renewed focus to a historically rich yet underutilised partnership. Both leaders, Prime Minister Narendra Modi and President Subianto, outlined an ambitious vision to overcome longstanding challenges and unlock the untapped potential of their collaboration to drive transformative regional and global impact.

As the two most populous democracies and key leaders in the Global South, India and Indonesia are uniquely positioned to shape global governance. Their shared democratic values and influence in multilateral forums like the G20 and BRICS+ enable them to advocate for more inclusive and equitable international institutions that prioritise the Global South. Their partnership has, however, been hindered by economic gaps, protectionist policies, and geopolitical differences. Recent agreements in defence, health, digital infrastructure, and maritime security, however, provide a solid foundation for a more dynamic and strategic partnership in 2025 and beyond.

India and Indonesia’s potential for collaboration is deeply rooted in their historical ties, shaped over centuries through cultural and maritime connections, including the spread of Hindu-Buddhist influences and thriving naval trade routes. Politically, their relationship strengthened in the post-World War II era, with India supporting Indonesia’s anti-colonial struggle and leaders like Nehru and Sukarno championing shared anti-imperialist ideals. Landmark events such as the Bandung Conference (1955) and the Non-Aligned Movement further solidified their collaboration.

Strategic Crossroads in 2025

The 2025 summit highlighted the critical juncture at which India and Indonesia now stand. Both nations, embracing strategic autonomy amid intensifying global rivalries, facing similar domestic challenges, such as inefficient bureaucracies, urban infrastructure gaps, and climate change resilience. Their shared geopolitical interest in ensuring stability in the Indian Ocean Region (IOR) further elevates the importance of their partnership for broader Indo-Pacific collaboration.

Economic Ties: A Promising Yet Underperforming Area

Economic cooperation remains an area of India-Indonesia relations with significant untapped potential. Bilateral trade has shown steady growth, India-Indonesia trade volume totaled $24.1 billion in January-November 2024 according to Jakarta Globe. Bilateral trade continues to make strong progress towards the $50 billion annual target. Indian companies in renewable energy and digital innovation, industries where India holds a competitive edge, can help accelerate this progress. The Local Currency Settlement Agreement between the Reserve Bank of India and Bank Indonesia, aimed at reducing reliance on the dollar, marks significant progress in easing financial barriers.

Additionally, President Subianto’s acceptance of India’s invitation to join the Global Biofuels Alliance highlights their shared commitment to sustainable energy transitions. Strengthening trade in critical minerals such as nickel and bauxite, key to India’s clean energy ambitions, presenting significant economic opportunities. Expediting the review of the (The Association of Southeast Asian Nations) ASEAN-India Trade in Goods Agreement (AITIGA) could further enhance regional integration by resolving tariff-related challenges.

Healthcare and Digital Infrastructure Collaboration

The summit catalysed agreements in healthcare, focusing on vaccine manufacturing, digital health initiatives, and capacity building. India’s global reputation as a pharmaceutical hub can help Indonesia address healthcare delivery gaps, particularly in its push for universal health coverage. Training Indonesian healthcare professionals in India and fostering R&D collaborations in traditional medicine offers practical avenues to operationalise this partnership.

In digital infrastructure, India’s successful models like Aadhaar and UPI can guide Indonesia’s digitalisation efforts. The memorandum on digital development signals collaboration in fintech innovation, quantum computing, and cross-border digital payment systems. Restoring direct flights and enhancing air service agreements will further deepen economic ties and people-to-people connections.

Maritime Security and Defense Cooperation

As maritime nations with expansive zones, India and Indonesia are natural allies in ensuring security and governance in the Indian Ocean Region. Their co-leadership in the Indian Ocean Rim Association’s Working Group on Blue Economy reflects shared interests in sustainable maritime resource management. Recent agreements on white shipping exchange and the placement of Indonesian liaison officers at India’s Information Fusion Centre in Gurgaon will enhance maritime intelligence and security cooperation.

Defence ties have also strengthened, with Indonesia’s renewed participation in Indian-led multilateral naval exercises and the signing of a Defence Cooperation Agreement. Joint training, submarine rescue operations, and technology exchanges are key to addressing shared challenges such as illegal fishing and transnational crime.

A Joint Global South Agenda

India and Indonesia are well-positioned to champion a unified Global South agenda, balancing economic and security concerns with the broader interests of developing nations. Platforms like BRICS+ and India’s Voice of the Global South summit provide opportunities to advance this solidarity. India’s emphasis on ASEAN centrality in its Indo-Pacific strategy complements Indonesia’s leadership within ASEAN, creating avenues for broader bilateral and regional coordination.

While the summit lays out a promising roadmap, tangible progress will require fast-tracking the execution of agreements. Track 1.5 dialogues engaging policymakers, think tanks, and private stakeholders are essential to generate actionable recommendations. Addressing regulatory bottlenecks, improving connectivity, and prioritising private-sector engagement will further strengthen ties.

India and Indonesia’s shared histories, aligned interests, and complementary strengths present a compelling case for redefining their bilateral partnership. By addressing existing challenges pragmatically and delivering on recent agreements, the relationship can become a cornerstone for Global South solidarity.

*Dr Iqbal Survé

Past chairman of the BRICS Business Council and co-chairman of the BRICS Media Forum and the BRNN

*Zena Harvey

Associate at BRICS+ Consulting Group

India & Southeast Asia Specialist

**The Views expressed do not necessarily reflect the views of Independent Media or IOL.

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