Prime Minister Narendra Modi’s upcoming visit to Indonesia comes at a time when India has an opportunity to transform one of Asia’s least understood bilateral relations into one of its most valuable strategic partnerships.
India and Indonesia are the two largest democracies in the Indo-Pacific, major maritime powers, G20 members, and influential voices in the Global South. Yet despite shared strategic interests and civilizational ties, their contemporary partnership continues to underperform.
This visit should be seen as an opportunity to draw a framework for long-term cooperation rooted in mutual development, technological cooperation, maritime security and shared economic resilience.
The relationship received a new impetus during the visit of Indonesian President Prabowo to India in January 2025, when both countries celebrated the 75th anniversary of diplomatic relations. Agreements on health, digital cooperation, maritime security, traditional medicine and cultural exchanges demonstrated a wide-ranging agenda. Modi’s visit now provides an opportunity to convert these into measurable results.
Historically, there has been extraordinary goodwill between India and Indonesia. Their cooperation during anti-colonial struggles, participation in the Bandung Movement, and support of the multipolar international order created a durable political foundation. Naval cooperation has steadily expanded through coordinated patrols and maritime exercises. Defense ties have deepened, including Indonesia’s interest in Indian defense equipment such as BrahMos. Cultural cooperation is vibrant, while Indian investment has gradually increased.
Nevertheless, economic relations remain normal. Bilateral trade of about $30 billion is below potential, and although Indian investment has increased, it remains significantly lower than that of China, Japan, South Korea and Singapore. Diplomatic warmth has not yet translated into resilient economic supply chains.
Today’s strategic environment provides the conditions that make a strong partnership both desirable and achievable.
India and Indonesia increasingly see themselves as leading voices of the Global South. Both want reform of global governance institutions, more equitable development financing, better climate financing, resilient food systems and greater access to technology. At a time when geopolitical rivalry is fragmenting supply chains and undermining globalization, both countries have enough economic weight and diplomatic influence to advance an inclusive international order.
Unlike many Global South partnerships that remain rhetoric, India and Indonesia have complementary strengths that can yield practical cooperation. Indonesia is increasingly looking towards India’s recent development experience, particularly its success in digital governance, public service delivery and large-scale social programmes.
India’s digital public infrastructure has attracted considerable attention. Indonesia has shown interest in adopting elements of India’s Open Network for digital commerce models through the Indonesia Open Network initiative. This digital partnership can extend beyond e-commerce to include digital identity systems, payment platforms, fintech, artificial intelligence, cyber security and digitization of micro, small and medium enterprises. As many developing countries seek affordable, scalable digital solutions, India and Indonesia can together create a Global South model for technology cooperation.
Governance itself provides another important area of cooperation. Indonesian policymakers have shown interest in understanding how India uses digital tools to improve the delivery of government services. India’s experience in initiatives such as welfare delivery, digital payments, education programmes, public health systems and midday meal schemes provides lessons that can be adapted to Indonesian conditions. Expanded training programs for Indonesian civil servants, public administrators and technical experts could become an important pillar of bilateral engagement.
Health cooperation similarly holds great promise. As Indonesia expands its health care commitments, there is increasing scope for Indian hospitals, medical institutions and training centers to contribute to the development of Indonesia’s health workforce. Capacity building, nursing education, specialized medical training and health care management can emerge as important areas of cooperation that will directly benefit Indonesian society while strengthening India’s development partnership credentials.
Critical minerals represent another strategic opportunity. Indonesia has the world’s largest reserves of nickel and other minerals needed for electric vehicles, batteries and advanced manufacturing. However, most of its production is being exported with relatively limited domestic value addition. Like many resource-rich countries, Indonesia also seeks rapid downstream processing and industrial development.
This creates opportunities for Indian investment. Indian companies can set up processing facilities in Indonesia, which will help build local manufacturing capacity as well as strengthen India’s own critical mineral supply chains. It could advance Indonesia’s industrial ambitions while contributing to India’s long-term manufacturing and energy-transition objectives.
Food and energy security provide an equally strong foundation for partnership. Both countries face vulnerabilities posed by food inflation, volatile energy prices and climate change. Investments in food processing, fertilizers, renewable energy and strategic reserves could create greater resilience for both economies.
The maritime dimension is perhaps the most strategically important. Indonesia holds an important position near the Strait of Malacca, one of the world’s most important maritime chokepoints. India’s Act East policy naturally matches Indonesia’s strategic position. Shared concerns regarding maritime domain awareness, piracy, illegal fishing, humanitarian assistance and disaster relief provide a solid foundation for deeper naval cooperation beyond the AOIP.
The next phase should move beyond coordinated exercises to defence-industrial cooperation, maintenance facilities, technology transfer and joint production. Indonesia’s desire to diversify defense suppliers creates opportunities for Indian defense manufacturing and servicing while contributing to regional stability.
Equally important is the need to strengthen human relationships. One of the biggest weaknesses of the relationship is the surprisingly limited understanding which is similar to the ‘Masala Bambu’ effect in each country. Indian businesses often know little about Indonesia compared to the West or the Gulf, while many Indonesians view India primarily through historical and cultural associations.
There is an urgent need for wider exchange between universities, think tanks, researchers, professionals, students and start-ups. A large number of scholarships, academic partnerships and institutional dialogue will help create the components that will sustain relationships beyond government initiatives.
There is also a need to pay attention to business facilities. Indian companies continue to report difficulties in navigating Indonesia’s regulatory environment. A more effective single-window clearance mechanism, faster administrative processes and better investment facilitation will encourage Indian investment on a large scale. As Indian businesses expand overseas, Indonesia should become one of their preferred destinations.
Perhaps the most valuable aspect of the emerging partnership is that both countries are seeking strategic autonomy amid growing superpower rivalry. Rather than becoming an arena of competition, India and Indonesia have an opportunity to build a relationship based on mutual economic resilience and development cooperation. Helping Indonesia become more ‘self-reliant’ (self-reliant) in technology, healthcare, digital governance and industrial development also complements India’s broader vision of a more capable Global South.
Therefore, Modi’s visit offers much more than another diplomatic milestone. If both countries focus on implementation rather than announcements, developing major projects in digital technology, healthcare, education and critical minerals, while deepening maritime cooperation and facilitating greater business engagement, India and Indonesia could build one of the Indo-Pacific’s most consequential partnerships.
(Gurjit Singh is a former ambassador to Indonesia and author of The Durian Flavour. Views expressed are personal)
