India-Indonesia Relations: A Historical and Contemporary Perspective

Indonesian President Prabowo Subianto visited India from January 23 to 26, 2025. This marked his first state visit to India since assuming office in October 2024. During his visit, President Prabowo was the Chief Guest at India’s 76th Republic Day celebrations on January 26, 2025. Notably, a 352-member marching and band contingent from Indonesia participated in the parade, marking the first such participation by an Indonesian contingent in a national day parade abroad. In addition to attending the Republic Day events, President Prabowo held bilateral talks with Indian Prime Minister Narendra Modi. The two leaders signed agreements to enhance cooperation in various sectors, including health, defense, digital technology, and maritime affairs. 

India and Indonesia share a long-standing relationship rooted in historical, cultural, and civilizational ties. As two of Asia’s largest democracies and key members of multilateral platforms like the G20 and ASEAN, their relationship continues to grow in importance. With both nations strategically located along major maritime routes, their partnership has expanded to include political, economic, defense, and cultural cooperation.

Historical Ties

India and Indonesia’s connection dates back to ancient times, primarily through maritime trade and cultural exchanges. The spread of Hinduism and Buddhism to Indonesia, particularly during the early centuries CE, laid the foundation for strong cultural ties. Iconic landmarks such as the Borobudur and Prambanan temples in Indonesia reflect India’s historical influence on its art and architecture. Similarly, epics like the Ramayana and Mahabharata remain central to Indonesian culture, especially in the Javanese and Balinese traditions.

The 20th century saw both nations cooperating during their struggles for independence. Leaders like Jawaharlal Nehru and Sukarno, Indonesia’s first president, shared close relations and jointly advocated for decolonization and non-alignment during the Bandung Conference of 1955, which laid the foundation for the Non-Aligned Movement.

Contemporary Relations

India and Indonesia have transformed their historical ties into a modern, strategic partnership. In 2005, the two nations signed a Strategic Partnership Agreement, which was upgraded to a Comprehensive Strategic Partnership during Prime Minister Narendra Modi’s visit to Indonesia in 2018.

Key Contemporary Achievements

1. Political and Defense Cooperation:
   • India and Indonesia conduct regular high-level visits, reflecting mutual commitment to their partnership. President Joko Widodo visited India in 2016, while Prime Minister Narendra Modi visited Indonesia in 2018.
   • Both nations cooperate in defense through joint military exercises like the Samudra Shakti (naval exercise) and Garuda Shakti (army exercise).
   • They also work closely on combating terrorism, piracy, and transnational crimes. In 2018, a Defense Cooperation Agreement was signed to enhance collaboration in maritime security and defense technology.
2. Economic Ties:
   • India is Indonesia’s second-largest trading partner in South Asia, with bilateral trade crossing $20 billion in 2022-23. Key exports from Indonesia include coal, palm oil, and rubber, while India exports refined petroleum, agricultural products, and pharmaceuticals.
   • Both nations signed the India-Indonesia Trade Agreement under the ASEAN-India Free Trade Area (AIFTA), reducing tariffs on several goods.
   • Investments have grown significantly. Indian companies, such as the Adani Group and Tata Steel, are active in Indonesia, while Indonesian firms invest in sectors like infrastructure and energy in India.
3. Connectivity Initiatives:
   • The two countries are strengthening maritime and air connectivity. In 2018, India and Indonesia agreed to develop Sabang Port, located near the Andaman and Nicobar Islands, to enhance maritime trade and security in the Indian Ocean region.
   • Efforts are also underway to improve direct flights between major cities to boost tourism and people-to-people contact.
4. Cultural Diplomacy:
   • Programs like the Sahabat India Festival in Indonesia and the celebration of Indian festivals like Diwali and International Day of Yoga have deepened cultural ties.
   • India provides scholarships to Indonesian students under the Indian Council for Cultural Relations (ICCR) and promotes academic exchange programs.
5. Maritime Cooperation:
   • As maritime neighbors, both nations are actively cooperating under the Indian Ocean Rim Association (IORA).
   • In 2018, India and Indonesia launched a “Shared Vision on Maritime Cooperation in the Indo-Pacific,” emphasizing the importance of a free, open, and rules-based Indo-Pacific.

Key Political and Economic Deals

1. Strategic and Defense Agreements:
   • 2018 Defense Cooperation Agreement: Focused on joint exercises, training, and counter-terrorism efforts.
   • Shared Vision on Maritime Cooperation in the Indo-Pacific (2018): Ensured collaboration in maritime security and sustainable use of marine resources.
2. Trade Agreements:
   • India and Indonesia are signatories to the ASEAN-India Free Trade Agreement (AIFTA), enhancing trade by reducing tariffs.
   • India has invested in Indonesian energy sectors, particularly coal mining and renewable energy, while Indonesia supplies critical commodities like palm oil and coal to India.
3. Infrastructure Projects:
   • Development of Sabang Port and enhanced cooperation in building smart cities in Indonesia.
   • Joint investments in energy infrastructure and renewable energy initiatives.
4. Cultural and Educational Agreements:
   • 2019 MoU on Cultural Exchange: Strengthened collaborations in arts, heritage, and education.
   • Scholarships under ICCR for Indonesian students to study in India.

Challenges in Relations

Despite progress, India and Indonesia face some challenges:

• Trade Imbalance: India imports more from Indonesia, particularly coal and palm oil, leading to a trade deficit.
• Regional Tensions: Issues like the South China Sea disputes and China’s growing influence in the region require careful navigation by both nations.
• Counter-Terrorism: Both nations face threats from terrorism and extremism, necessitating stronger coordination.

India and Indonesia, as two vibrant democracies and maritime neighbors, continue to strengthen their partnership through strategic, economic, and cultural cooperation. With shared interests in ensuring a stable Indo-Pacific region, fostering economic growth, and preserving cultural heritage, the two nations are well-positioned to navigate the challenges of the 21st century. Moving forward, enhanced connectivity, balanced trade, and deeper defense ties will be key to realizing the full potential of this robust partnership.