In order to create a new momentum

India should be more proactive in engaging Indonesia, which, as the largest nation in the Asean region, ought to form the core of its Look East policy, writes Pinak Ranjan Chakravarty

On October 20, Joko "Jokowi" Widodo was sworn in as Indonesia's seventh president. The presidential election on July 9 took place 16 years after Indonesia's transition to democracy following the overthrow of President Suharto's regime.Widodo came to power after having defeated his opponent, Prabowo Subianto, a former army general, former son-in-law of Suharto and the son of Sumitro Djojohadikusumo, a former minister.

Widodo had Jusuf Kalla, former vice-president of Indonesia, as his running mate in order to secure the necessary percentage of seats and votes in the legislative elections of April 2014. In the final tally, the Widodo-Kalla combination won 53.16 per cent of the votes while the Prabowo-Hatta Rajasa combination won 46.48 per cent of the votes. Choosing Kalla was crucial for the electoral triumph because Kalla is a former chairman of the Golkar party that came second in the legislative election. The tie-up with Kalla split the Golkar votes. Subianto's controversial views on Indonesian nationalism and his association with the human rights violations of the Suharto regime also helped swing votes away from the former general. Widodo also survived the legal challenge thrown by his opponent in the constitutional court that ruled against any electoral malpractice and upheld Widodo's electoral victory.

Widodo's election marks a clear break from the older leadership that has often been associated with political families and the military leadership. Jokowi, as Widodo is popularly known, is a self-made businessman and does not belong to the traditional ruling elite of Indonesia. The former furniture businessman rose from humble origins to become the governor of Jakarta. He is a new symbol for the common people in a region dominated by political dynasties. From democracies to authoritarian states, several of the region's nations are run by children of political dynasties. 

China's president, Xi Jinping is the son of the former Chinese vice-premier, Xi Zhongxun, one of the leaders credited with China's modernization. Japan's prime minister, Shinzo Abe, is the grandson of Nobusuke Kishi, Japan's former prime minister who signed the 1960 security treaty with the United States of America. The president of the Republic of Korea, Park Geun-hye, is the daughter of Park Chung-hee, the former president and military dictator who modernized South Korea's economy in the 1970s. In North Korea, Kim Jong-un took over the mantle of leadership from his father and grandfather. In the Philippines, President Benigno Aquino is the son of former president, Corazon Aquino, who was instrumental in overthrowing the 20-year authoritarian rule of Ferdinand Marcos and later became the first woman president of Asia. Prime Minister Najib Razak of Malaysia is the son of the country's second prime minister. Prime Minister Lee Hsien Loong of Singapore was groomed by his father, Lee Kuan Yew, the country's first prime minister, for his current job.

India and Indonesia have bucked this trend in the recent elections. Widodo is a member of the Indonesian Democratic Party of Struggle, headed by Megawati Sukarnoputri, daughter of Indonesia's first president, Sukarno. The shadow of a scion of a political family remains but Widodo is not descended from a parent or a grandparent who previously ruled Indonesia. Hence, Widodo's victory underlines the consolidation of democracy in Indonesia. The same holds true for India's prime minister, Narendra Modi.

Widodo faces many policy challenges. Foremost among them is how to keep his election promise of creating 10 million new jobs and continuing the economic reforms. Indonesia has suffered from the lack of proper environmental protection policies, leading to deforestation. Rampant corruption and nepotism have also undermined democracy. There is growing concern among investors about nationalist economic measures that include a ban on the export of raw ores and minerals. The mining lobby wants the eight-month old ban on exports of unrefined ores to be relaxed, claiming that it is causing a loss of $400 million a month in exports.

One of the biggest multinational mining companies, Newmont Mining, withdrew an international arbitration case against the ban. It has chosen to negotiate with the government over the issue of copper concentrate exports and local processing. Freeport-McMoRan, an American mining giant, signed a deal with the government to develop a domestic smelter and make various changes to its contract terms. These deals have buoyed nationalist sentiment and helped move towards the setting up of a domestic smelter industry. The government's attempt to force the mining sector to process raw materials in Indonesia and export finished products, via the ban, has affected exports. A tiered export tax imposed earlier in the year may be ripe for review but the ore export ban, having been written into a law, cannot be changed.

Another pending bill, if enacted into law, will soon force foreign investors to dilute their ownership in plantations from the current 95 per cent and sell 70 per cent of it to Indonesian nationals. Foreign-owned assets in Indonesia are coming under the pressure of economic nationalism. Lawmakers are seeking to dilute foreign ownership, largely Malaysian or Singaporean, in the country's palm oil industry - the world's largest. The bill is aimed at opening up the sector to smaller, local players. The government's goal of raising palm oil output by a third to 40 million metric tons by 2020 will take a hit.

The Indonesian economy's most pressing challenge is that of subsidies. Indonesians overwhelmingly oppose any cut in subsidies, particularly in fuel and electricity. Domestic oil production is heading south and imports are adding to government expenditure. Massive smuggling of subsidized fuel is adding to the subsidy mess. It is estimated that subsidies have reached $35 billion and are squeezing spending on social sectors and infrastructure. In a report on the Indonesian economy, titled "Hard Choices", the World Bank has warned that the economy, ranked 16th globally, would grow at 5.2 per cent during the current year, down from the earlier high of 5.4 per cent.

If there are two countries that share much in common, they are Indonesia and India. Indonesia, the largest economy in south-east Asia, the fourth largest country in the world in terms of population, the largest Muslim country, with the island of Bali still predominantly Hindu, shares a maritime boundary with India in the Indian Ocean. The northern tip of Sumatra, the westernmost island of the Indonesian archipelago, is a few hundred kilometres from the Great Nicobar island. For over two thousand years, India and Indonesia have shared close cultural and commercial contacts. By the 7th century, almost all of Indonesia's western islands (there are over 17,000 islands in the archipelago) came under Hindu-Buddhist rulers. These contacts left an enduring imprint of Hindu-Buddhist culture on Indonesia, particularly on Java, the most populous island of Indonesia.

The magnificent Buddhist stupa of Borobudur and the Hindu temple complex at Prambanen at Yogyakarta are testimony to this heritage. From the 16th century, Indonesia adopted Islam but retained its earlier culture. The European colonialists also arrived and Indonesia came under Dutch colonial rule till its independence in 1949. At the centre of the capital city, Jakarta, there is a magnificent sculpture of Krishna on a chariot, leading Arjun into battle. A similar sculpture greets visitors just outside Denpasar airport on the island of Bali, a popular tourist resort.

The Istiklal mosque, biggest in Indonesia, and a Catholic cathedral dominate Jakarta's main downtown square alongside the sculpture of Krishna and Arjun, symbolizing the tolerance and pluralism that both Indonesia and India share. "Bahasa Indonesia", as the national language is known, is peppered with Sanskrit words and everywhere there are references to the Ramayana and the Mahabharata. The national airline is named 'Garuda'. 'Bhinnekka Tunggal Eka' is the Indonesian national motto, meaning "unity in diversity".

India is no stranger to this ethos. This shared heritage enabled close collaboration during the respective struggle for independence from colonial bondage and both countries strongly supported the cause of Asian and African independence. After independence, the two countries laid the foundation of the Afro-Asian and non-aligned movements at the Bandung Conference in 1955. Yet Indonesia, somehow, remains below the radar of the Indian media because of its low-key approach to diplomacy.

Relations cooled during the 1965 war with Pakistan, when Indonesia, in a mistaken fit of Islamic solidarity, came out in support of Pakistan. Since the adoption of India's 'Look East Policy' in 1991, there has been a rapid development of bilateral relations in political, security, defence, commercial and cultural fields. The multi-faceted relationship got an added fillip with the signing of the 'Joint Declaration on Establishing a Strategic Partnership' in 2005. Indonesia is an important trading partner of India in the Association of Southeast Asian Nations region. India-Indonesia bilateral trade has increased from $ 6.9 billion in 2007-08 to $20 billion in 2013-14. India is the largest buyer of crude palm oil from Indonesia and imports coal, minerals, rubber, pulp and paper, and hydrocarbons. India exports refined petroleum products, maize, commercial vehicles, telecommunication equipment, oil seeds, animal feed, cotton, steel products and plastics to Indonesia. India also exports pharmaceuticals in bulk and formulations to the nation.

Several Indian companies have made significant investments in mining, infrastructure, power, textile, steel, automotive, mining machinery, consumer goods and banking. Over 100,000 Indonesians of Indian origin live in Greater Jakarta, Medan, Surabaya and Bandung. They are mainly engaged in the trade of textiles and sports goods. There are around 10,000 Indian nationals living in Indonesia, including engineers, consultants, chartered accountants, bankers and other professionals.

Widodo's challenges on the economic front will be matched by the challenge of dealing with rising Islamist tendencies that have been unleashed as a result of Indonesia's transition to democracy. Vigilante groups, including the notorious Front Pembela Islam, have become active in using Islamic edicts to justify violent attacks on bars, nightclubs, churches and mosques of Shias and Ahmadiyas. Indonesian human rights activists have blamed the previous government for failing to protect the minorities by making it harder to obtain permits for building churches, temples and mosques for Shias and Ahmadiyas. Wahabi Islam, fuelled by petrodollars, has spread and so has intolerance. Indonesian democracy ensures the right to protest and hold demonstrations against the government, but the attacks on minorities have not decreased.

On the foreign policy front, Widodo's immediate challenge will be China's aggressive moves in the South China Sea. For the past two years, China's tactics have included intimidation, naval patrols, blockades, oil rig placements, ramming of fishing vessels and construction of facilities on several small islands and shoals. Indonesia has kept up its façade of denial that it has no dispute with China and has sought to carve out a role for itself as a mediator. Jakarta has also been a strong supporter of a legally binding code of conduct in the South China Sea.

In 2010, however, an Indonesian ship arrested Chinese trawlers and was threatened at gunpoint by Chinese vessels off the Natunas, the Indonesian islands that China claims under its nine-dash line in the South China Sea. This prompted Indonesia to submit aNote Verbale (written diplomatic communication) to the United Nations secretary-general, rejecting China's "nine-dash line."

Indonesia is caught in a dilemma. It does not want to recognize the dispute with China and the latter too has played it down knowing it has a weak hand to play. But this position is becoming increasingly untenable for Indonesia given China's cartographic aggression. China now claims the area around Natunas in new maps as its "territory".Widodo may find this issue one of his immediate foreign policy challenges. For the first time, Indonesia has acknowledged that China is making unilateral claims on Indonesia's Riau province, which includes Natuna and other islands in this group.

The China factor may also propel Widodo to seek closer relations with Japan. He hinted at it in interviews to the Japanese media. Widodo has sought greater Japanese investment in infrastructure, energy and industrial development. Soon after the election results were declared, Widodo had telephoned Abe and declared his intention to visit Japan. Indonesia is looking at Japan as a countervailing move against China. In other words, Indonesia can no longer pretend that there is no dispute with China.

It does not require an epiphany to realize that Indonesia, the largest nation in the Asean region, should be at the core of India's 'Look East' policy. India's geostrategic concerns make it imperative for it to adopt a proactive policy of engaging Indonesia. The time is opportune to build a web of relationships with Japan, Indonesia and Vietnam and other Asian nations so as to deter any adventurism by any country in the larger interests of peace, stability and prosperity in Asia and in the world.

The author, a former ambassador, is former secretary, ministry of external affairs