India and Indonesia strengthen trade and security ties

Source: The post India and Indonesia strengthen trade and security ties has been created, based on the article “India-Indonesia ties as a beacon for global relations” published in “The Hindu” on 5th February 2025.

UPSC Syllabus Topic: GS Paper2- International Relations-Bilateral, regional and global groupings and agreements involving India and/or affecting India’s interests.

Context: The article talks about Indonesia-India relations. It highlights their trade, security, and geopolitical ties. It mentions economic growth, investment potential, and defense cooperation. It also discusses global trade challenges and their role in the Indo-Pacific and BRICS.

For detailed information on India and Indonesia strengthen ties under Prabowo read this article here

Why is Indonesia-India Relations Important?

1. Indonesia and India have a long and strong relationship. Their partnership began in 1950 when Indonesia’s first President, Sukarno, attended India’s first Republic Day.
2. In 2024, Indonesian President Prabowo Subianto was the chief guest at India’s 76th Republic Day.
3. This marked the fourth time an Indonesian president participated in this event, emphasizing the strong relationship between the two countries.

How Strong is Their Trade Relationship?

India and Indonesia signed a trade agreement in 1966. However, their trade potential is still not fully used. In 2023, bilateral trade was just under $30 billion. Business leaders from both countries identified five key sectors for growth:

• Energy – Investment in clean energy is needed.
• Food and Agriculture – Expanding trade in essential goods.
• Healthcare – Strengthening medical collaboration.
• Manufacturing – Boosting industrial ties.
• Technology – Improving digital and AI cooperation.

What is the Trade Growth Potential?

1. India and Indonesia plan to quadruple trade volume in 10 years. Both economies are growing fast:
2. Indonesia’s investment in India is $653.8 million, while India has invested $1.56 billion in Indonesia.
3. Both economies are growing rapidly: India (6.5%) and Indonesia (5.1%), higher than the global average (3.3%).
4. Stronger supply chains in clean energy, technology, and manufacturing can drive mutual prosperity.

Why is Security Important in Their Relationship?

1. Comprehensive Strategic Partnership (2018): India and Indonesia strengthened defense ties, enhancing maritime security in their shared waters.
2. Maritime Security: Both countries made significant strides in securing their sea routes, crucial for regional stability.
3. Counterterrorism & Cybersecurity: During President Prabowo’s visit, both leaders committed to improving collaboration in these areas.
4. Growing Military Capabilities: As two large nations with expanding defense strength, cooperation is vital for regional security.
5. Indo-Pacific Stability: Their partnership helps address complex geopolitical challenges and ensures long-term prosperity.

How Do They Fit in Global Politics?

1. Indonesia joined BRICS in 2024, which includes India and China. Both countries have strong relations with the U.S. and Western nations.

2.,However, U.S. trade policies, such as new tariffs, may create challenges. Indonesia is a major exporter of nickel, copper, tin, and bauxite and wants to expand trade with India and other global markets.

What is the Future of This Partnership?

India and Indonesia have a 76-year-old relationship. Their focus on trade, security, and global cooperation will strengthen their ties. Their partnership can help shape the future of the Indo-Pacific and contribute to a stronger global economy.

Question for practice:

Examine the significance of India-Indonesia relations in trade, security, and global geopolitics, highlighting key developments and future potential.