[Answered] How can India boost its ties with Indonesia to achieve a strong bilateral partnership and make it an important partner in India’s Act East Policy? Discuss.

India-Indonesia with deep commonalities in all spheres of relationship has been best described as Rabindranath Tagore as journey of ancestors resulting in companion souls. With a bilateral trade of around $20bn, Indonesia is India’s 2nd largest trading partner in ASEAN and is also an important partner in maritime cooperation. But despite the size of growth, the India-Indonesia relationship has been one of potential rather than realization.


Challenge lies in is how to contemporize the old warmth and make Indonesia a strong partner in India’s Act East Policy. The Act East Policyendeavours to cultivate extensive economic and strategic relations in South-East Asia. Possible ways could be:

  • Leveraging on Indonesia’s strategic maritime location: Its location and Malacca straits holds great significance not only to the trade but also for security reasons. Along with Indonesia’s vision of maritime axis, there is a need to recognize the centrality of Indonesia in the Indo-Pacific and initiate a strategic dialogue and defence partnership as established Strategic Partnership (2005).
  • Filling the security vaccum in the region: There is a need for robust maritime security capability
  • Its role a stabilizer in the region: Indonesia, with its geo-strategic location and reach, size, demography and economic potential, and balanced and nuanced relations with the US, China and Japan, would be the best placed to play a broader stabilising role in the region.
  • Enhanced trade: Along with the trade and investments that exist in that exists coupled with Indian investment in Indonesia taking advantage of the natural resource (coal, textiles, steel, and the auto and banking sectors) and industrial potential of Indonesia, there is scope for greater Indian investment in areas of strategic importance for Indonesia as space etc.
  • Improved connectivity:Improved connectivity via shipping offers large scope for balancing trade and increasing India’s export of engineering, consumer goods, textiles, pharmaceuticals etc.
  • Defence and security: The New Strategic Partnership (NSP) could also be used to renew and upgrade our MoU on Defence Cooperation of 2001. This could cover cooperation in the Indo-Pacific, exports of equipment for defence and maritime and coastal surveillance, defence production, technical cooperation, more advanced service-to-service talks and exercises, cooperation on hydrographic surveys, and pollution control; and separate MoUs or mechanisms for sharing of maritime security information on non-traditional threats including environmental threats, counter-terrorism, and information on white shipping.
  • Also imaginative steps in the areas of trade and investment and Culture and People-to-People Relations as part of the proposed Comprehensive Economic Partnership under the NSP would help in furthering India’s ACEP.

Thus, in order to realize the full potential of Indonesia both the nations agreed to prioritize defence and maritime cooperation to ensure the safety and security of the sea-lanes, in disaster response and environmental protection. The recently concluded Joint Statement on Maritime Cooperation outlines further covering above areas would also extend to to combating terrorism, organized crime, drugs and human trafficking.


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