Strategic Posture Review: Indonesia

Strategic Posture Review: Indonesia

An archipelago of 17,000 islands stretching 3,000 miles from east to west, Indonesia sits astride some of the world’s most important sea lanes of communication. Its 240 million people make it the world’s fourth-most-populous state and third-largest democracy, and with 88 percent of its population Muslim, Indonesia is home to the world’s largest Muslim community. Indonesians believe that their country’s size, strategic location and domestic achievements entitle it to a leadership role in global affairs, and that case is strengthened by the country’s experience with various transnational threats: Indonesia faces homegrown and transnational terrorism, is the world’s fourth-largest emitter of greenhouse gases and has suffered more deaths from avian influenza than any other country.

Despite its size, Indonesia is distinctly lacking in hard-power assets. Because its island status making it relatively immune from external attack and its ethnic diversity makes it prone to social fragmentation, Indonesia’s key security threats have traditionally been internal, not external. As a result, Indonesia’s strategic posture is defensive, and it has virtually no power-projection capability. The source of Indonesia’s influence is soft power, which it has used to create regional institutions such as the Association of Southeast Asian Nations (ASEAN) to promote regional stability and pursue its key strategic objective of ensuring that Southeast Asia never fall under the hegemony of an outside power.

With the Asia-Pacific in the midst of a power transition marked by the rise of China and India, the decline of Japan and uncertainty over U.S. willingness and capacity to play an offshore balancing role, the international environment facing Indonesia is becoming increasingly complex. As competition between the region’s larger powers intensifies, Indonesia’s ability to harness their influence in pursuit of its own interests will be increasingly difficult. At the same time, by opening the country’s policy process, democratization has complicated the formulation of Indonesian foreign and defense policy. Increasingly, Indonesia’s ability to achieve its international goals will depend on its domestic achievements.

Foreign Policy

Promulgated in 1948, Indonesia’s “bebas dan aktif” (free and active) doctrine has its roots in the immediate postcolonial period and remains the guiding principle of Indonesian foreign policy. The free component holds that Indonesia should chart its own course in foreign affairs, while the active component holds that Indonesia should work to shape the international system.

To demonstrate independence from both superpowers, Sukarno, Indonesia’s charismatic nationalist leader from 1945 to 1965, took an active role in the Non-Aligned Movement (NAM) and responded to what he considered neocolonial actions by the West with dramatic moves that gave Indonesian foreign policy a strong anti-imperialist flavor. When the U.S. supported separatist rebels in the 1957-1958 Outer Island rebellions, Sukarno turned to the Soviet Union for assistance, and by the early 1960s Indonesia was the largest recipient of Soviet aid outside the communist bloc. And when the U.S. sought to halt Indonesia’s tilt toward communism by promising economic assistance, Sukarno declared the U.S. could “Go to hell with its aid.”

At home, Sukarno sought to unite Indonesia’s heterogeneous population through the promulgation of the “pancasila” (five principles), an inclusive ideology designed to bridge the country’s religious, ethnic and regional divisions that remains the ideological foundation of the Indonesian state today.

In the end, Sukarno was able to maintain neither Indonesia’s independent stance in foreign affairs nor the unity of his people. As Sukarno tied his fortunes to the Indonesian Communist Party (PKI) at home, he aligned more closely with its key foreign supporter, China, and declared a Jakarta-Hanoi-Peking-Pyongyang-Phnom Penh axis. In October 1965, a coup and countercoup triggered an orgy of violence that would result in the decimation of the PKI, the death of at least 500,000 Indonesians and the rise of Gen. Suharto and the Indonesian military (TNI).

During his rule from 1965 to 1998, Suharto directed a wholesale reorientation of Indonesian domestic politics that produced equally dramatic shifts in foreign policy. Political order would replace instability; conservative forces would replace left-wing ones; and integration into the global capitalist economy would replace economic autarky. Convinced of Chinese complicity in the 1965 coup, Suharto froze relations with China in 1967. Lacking Sukarno’s nationalist credentials, Suharto sought to legitimize his regime through economic development. Foreign policy was no longer a means to assert independence but a tool to secure resources for development.

Suharto’s anti-communist ideology meant the West and Japan replaced the Soviet Union and China as Indonesia’s key supporters. Over the next three decades, Indonesia’s economy would grow by 7 percent annually, lifting millions out of poverty and placing Indonesia among the ranks of Asia’s economic success stories. Yet, despite the country’s economic success, most Indonesians continued to view capitalism warily.

To promote the regional stability necessary for development, Suharto took the lead in creating ASEAN, which served as a vehicle for Indonesian regional leadership and a mechanism by which Suharto reassured Indonesia’s smaller neighbors of its peaceful intentions. ASEAN promulgated a regional code of conduct based on norms of noninterference in one another’s domestic affairs and peaceful settlement of disputes. Over the next three decades, Indonesia helped mediate numerous regional conflicts.

Over the course of Suharto’s rule, the U.S. became the primary patron of the TNI. And when it appeared that East Timor’s left-wing Fretilin party would emerge as the ruling party as that Portuguese colony prepared for independence in 1975, the U.S. quietly acquiesced to Indonesia’s invasion. With the end of the Cold War, which roughly coincided with the 1991 Dili massacre of unarmed East Timorese by Indonesian soldiers, the U.S. increasingly curtailed military aid, training and equipment sales to Indonesia. This triggered resentment in Indonesia, which had trouble understanding why the U.S. would sacrifice good relations with Jakarta for the sake of tiny East Timor.

By the early 1990s, Suharto was sufficiently confident of Indonesia’s domestic and regional achievements that he sought a larger global role. As he did so, Indonesia reverted to key policy planks of the Sukarno era, in part due to criticism that Indonesia had strayed from its free and active principles by working so closely with the West. Suharto lobbied for the chairmanship of the NAM, claiming that Indonesia’s economic success gave it a special role to play as a bridge between the West and the developing world. Indonesia reinstated diplomatic relations with China in 1990, partly to achieve this goal, and won the NAM chairmanship in 1992. By the mid-1990s, Indonesia had parlayed Suharto’s developmental success and regional leadership in ASEAN into Sukarno’s goal of Third World leader.

The Asian financial crisis hit Indonesia hard. As the economy contracted 13.8 percent during 1998, Indonesia morphed from an economic miracle into a hotbed of crony capitalism. Indonesians were shocked by the speed with which outsiders were to “rebrand” Indonesia during the crisis and the tumultuous events that followed. Shorn of the legitimacy provided by economic progress, Suharto was overthrown in May 1998.

In the early years of what Indonesians call the reform era, Indonesia’s attention was focused inward, and its foreign policy was directed at soliciting external support to promote economic recovery and the transition to democracy initiated by Suharto’s successor, B.J. Habibie. The magnitude of the crisis and the opportunity to help Indonesia transition to democracy meant that aid was forthcoming, albeit not always on terms agreeable to Jakarta. The International Monetary Fund provided a $43 billion bailout package but conditioned its support on structural adjustment policies that even disinterested observers claim deepened and prolonged the crisis. This experience reinforced longstanding beliefs that the Western countries that controlled the international capitalist system were determined to keep developing countries down.

Habibie’s decision to permit a United Nations referendum in East Timor ushered in Indonesia’s largest foreign policy crisis in decades. Following East Timor’s August 1999 vote for independence, pro-Indonesia militias and their TNI allies forced more than 200,000 East Timorese across the border, attacked United Nations personnel and destroyed 70 percent of the territory’s physical infrastructure. With the international community threatening to halt desperately needed economic assistance, Habibie permitted an international peacekeeping force in East Timor. The U.S., Australia and Great Britain, among others, cut military ties and placed sanctions on the sale of military equipment. Abroad, Indonesia had become an international pariah. At home, Habibie’s acquiescence to international pressure was viewed as a national humiliation.

The October 2002 Bali bombings that killed 202 people subsequently illustrated Indonesia’s vulnerability to terrorism. Coming on top of outbreaks of sectarian and religious violence elsewhere, it appeared that Indonesia was coming apart. At the beginning of the 21st century, some questioned whether Indonesia was poised to become another Yugoslavia: a country long held together by an authoritarian ruler only to fracture along ethnic and religious lines after political liberalization.

Indonesia’s achievements since then are remarkable. It has consolidated democracy, restored macroeconomic stability, posted economic growth of more than 6 percent in 2010, instituted an effective counterterrorism policy and resolved major social conflicts. Indonesia has many unresolved issues but has made great strides in many areas. Putting its domestic house in order has enabled Indonesia to focus on raising its international profile, a key goal of President Susilo Bambang Yudhoyono, who was inaugurated in 2004 and re-elected in 2009.

As Indonesia plays a larger international role, it is projecting a new identity based upon its domestic transformation. Indonesia is increasingly highlighting its status as a democratic, Muslim-majority state, while maintaining its traditional foreign policy planks of cooperation with ASEAN and solidarity with the developing world. Indonesian leaders firmly believe that their experience transitioning from authoritarian rule to democracy, peacefully resolving conflicts, managing a terrorist threat and overcoming an economic crisis give it the credibility to address many of today’s global challenges.

Nevertheless, raising its international profile requires good relations with major powers. Indonesian relations with Japan and China never suffered the same tensions as Indonesia’s relations with the West, in part because they largely kept economic aid flowing and had no military ties to cut following the East Timor crisis. Indeed, China used the opportunity created by the breach in Indonesia’s relations with its traditional partners to strengthen ties. Sino-Indonesian economic relations are booming, and political ties have expanded since their restoration in 1990. But Indonesia continues to view China’s intentions with some suspicion. Indonesian relations with Japan are much closer.

U.S.-Indonesian relations have improved dramatically over the past decade, after reaching a nadir during the early years of the Bush administration. Indonesians of all political stripes opposed the Afghanistan and Iraq wars, while Indonesian officials believed many of the tactics employed by the U.S. in its war against terror, from torture to the use of drone strikes causing collateral damage to civilians, only exacerbated their own terrorist challenge. The unilateralism of the Bush administration stood in stark contrast to Indonesia’s support for multilateralism. Moreover, U.S. Secretaries of State Colin Powell and Condoleezza Rice skipped multiple ASEAN meetings, which Indonesia interpreted as a lack of U.S. interest in Southeast Asia and the regional architecture Jakarta believes is critical to regional stability.

As Indonesia consolidated democracy and strengthened its counterterrorism policies, the Bush administration began a rapprochement toward Jakarta, providing extensive support to the relief effort in Aceh following the 2004 tsunami, restoring most military ties in 2005 and expanding educational and economic aid. Nevertheless, it was the election of President Barak Obama in 2008 that created an opportunity to upgrade the bilateral relationship, not only because Obama lived in Indonesia as a child, but also because his opposition to the Iraq War, support for multilateralism and calls for a new opening with the Muslim world were congruent with Indonesian interests. Today, officials in both countries claim the relationship is the best it has ever been.

At the global level, Indonesia is a staunch supporter of the United Nations, winning election to the Security Council for the 2007-2009 term. Indonesia has been an active participant in U.N. peacekeeping operations and currently has approximately 1,650 personnel deployed in Lebanon, Congo, Liberia and Sudan.

Indonesia’s ambition of playing a larger role in the broader Muslim world is limited by its traditional marginalization from it. Sukarno and Suharto both suppressed political Islam at home as a threat to social stability and avoided Islamic issues abroad. Rich in energy resources, Indonesia was traditionally an active member of the Organization of the Petroleum Exporting Countries (OPEC) but recently has become a net oil importer. Indonesia refused to sign the charter of the Organization of the Islamic Conference (OIC) in 1972 on the grounds that it was not an Islamic state. Indonesia has always supported the Palestine cause and never recognized Israel, but it justified that policy on anti-imperialist grounds, not religious ones.

Many Arabs view Indonesian Islam as second-class Islam, and few have traditionally desired a stronger Indonesian role in global Islamic affairs. Many in Saudi Arabia and elsewhere view Indonesia through the lens of the millions of Indonesian migrant workers toiling in the region, and relations are often complicated by tensions over their working conditions. As the Arab Spring illustrates, however, the Muslim world is far from monolithic. The political openings in parts of the Middle East have led some governments and civil society groups to solicit Indonesian advice on issues such as organizing elections, forming political parties, instituting a free press and exerting civilian control over the military.

Indonesia’ democratic foreign policy plank also manifests itself in the Bali Democracy Forum and effort to democratize ASEAN. Inaugurated in 2008, the Bali Democracy Forum aims to redress the region’s democratic deficit by providing a venue where Asian countries can discuss best practices. Indonesia was the prime mover behind the ASEAN Charter, which calls upon members to adhere to “the principles of democracy, the rule of law, and good governance, respect for and protection of human rights and fundamental freedoms.” This marks a dramatic shift for an organization whose bedrock principle is noninterference in domestic affairs.

In the Group of 20, Indonesia is an advocate for developing countries and chafes at what it sees as double standards in the international economic arena. Indonesia’s large domestic economy sustained growth during the recent global economic crisis, helping the government withstand most domestic demands for greater economic nationalism. Indonesia subsequently used its position as co-chair of the International Financial Institution reform working group within the G-20 to ensure that developing countries forced to accept IMF liquidity programs were spared the conditions Indonesia faced a decade ago.

Indonesia has exerted leadership on climate change, which scientists predict will have devastating impacts on Indonesia. Indonesia hosted the United Nations Framework Convention on Climate Change in 2007, and Yudhoyono pledged Indonesia to a 26 percent reduction in greenhouse gases in 2009, the first firm commitment of any developing country. Eighty percent of Indonesia’s greenhouse gas emissions come from the forestry sector, and in 2010 the government announced a two-year moratorium on the conversion of primary forests for commercial purposes. However, the government’s efforts to mitigate climate change face significant opposition from powerful interests. Whether the Yudhoyono administration can overcome these minority interests remains to be seen, and Indonesia’s ability to lead on climate change abroad will depend on progress at home.

Indonesia took the lead in challenging the World Health Organization’s influenza surveillance regime after learning that an Australian pharmaceutical company had patented a H5N1 vaccine from an Indonesian virus obtained from the WHO for free without Indonesia’s knowledge. Indonesia argued that the case illustrated the inequities of the global health regime: Countries are required to share virus specimens with the WHO, but the pharmaceutical companies that develop products derived from them have no obligation to make vaccines available or affordable to affected countries. Indonesia refused to share virus samples after 2007, despite having more confirmed deaths from avian influenza than any other country. In what Indonesia and its supporters in developing countries view as a diplomatic victory, the WHO revamped its procedures in 2011, after which Indonesia resumed virus-sharing.

Indonesia’s major trading partners are Japan, China, the U.S., Singapore and South Korea. Indonesia continues to be primarily an exporter of primary commodities, with oil and gas, minerals, crude palm oil, textiles and footwear, electrical appliances and rubber products its leading exports. Fearful that Indonesia’s low-tech industries would be unable to compete with their Chinese counterparts, Indonesia unsuccessfully sought to delay the implementation of the China-ASEAN Free Trade Agreement, which came into effect in 2010. As a result of the FTA and China’s soaring energy demand, China replaced the U.S. as the Indonesia’s second-largest trade partner in 2010. Rising resource nationalism in Jakarta, including attempts to renegotiate production-sharing agreements, has made international investors hesitant to invest in Indonesia, leading to a drop in energy production. With concerns over energy security rising worldwide, Indonesia’s exploitation of its resources will likely become increasingly politicized.

Defense Policy

As an archipelago, Indonesia is relatively immune from foreign invasion, and the country’s 2008 Defense White Paper (.pdf) foresees no external military threat in the next 15 years. Indonesia’s key security threats have traditionally been internal, arising from the social cleavages of its heterogeneous population. As a result, Indonesian officials have always viewed security in a comprehensive manner. The country’s security doctrine, “ketahan nasional,” is sometimes translated as “national defense,” but a more accurate translation is “national resilience,” which emphasizes not only military and economic strength but also the social cohesion necessary to withstand challenges to the state and social stability.

Like many postcolonial states, Indonesia legitimizes its claims to its current territorial borders not on the basis of an ancient civilization but as the successor to a European colony. Defending the territorial integrity of the state against secessionist challenges has always been the country’s primary security interest. Indonesian leaders fear that if any part of the country separated, the state could unravel. East Timor, as a former Portuguese colony, was an exception whose independence did not threaten the fundamental justification of the Indonesian state.

Since the 2005 Aceh peace agreement ended a 30-year separatist conflict there, the remaining secessionist challenge comes in Papua — a vast, sparsely populated province that Indonesia incorporated in 1969. Native Papuans, who are ethnically distinct and mostly Christian, are among the poorest Indonesians, despite the province’s natural wealth, which has been exploited largely for the benefit of outsiders. A small insurgency movement has simmered for years. Papua has been granted special autonomy, and policies have been adopted to address its legitimate grievances, but they are not always implemented, and the military is often repressive. Light sentences handed down in 2011 to military officers whose torturing of Papuan civilians was captured on videotape only intensified the conflict. Foreign human rights groups often argue that, like East Timor, Papua should have the option of choosing independence via referendum. This is heretical to Indonesia, which views Papua strictly as an internal issue and external interference as a violation of its sovereignty.

As a result of its internal focus, Indonesia’s strategic posture is defensive, and the country has little power-projection capability. Indonesia’s armed forces are often described as underfunded, undertrained and underequipped. Despite the prominent role the TNI traditionally played in Indonesian politics, it is a small force: Its 413,729 military personnel account for less than one-fifth of 1 percent of the country’s population. In the event of attack, Indonesia’s defense strategy is “hankamrata” (total people’s war). A legacy of Indonesia’s battle for independence, hankamrata calls for the mobilization of all Indonesian people and all national resources.

Indonesia’s defense policy views war as the last option and emphasizes diplomacy as its first line of defense. Nevertheless, Indonesia favors cooperative security over collective defense or alliances: Indonesia has no formal alliances and has foresworn foreign bases on Indonesian soil. Indonesia believes that only the United Nations has the legitimacy to authorize the use of military force against a sovereign state.

Reflecting its internal focus, the army is the TNI’s largest service, comprising 75 percent of all military personnel. More than half of the army’s soldiers, or approximately 150,000 men, serve in its territorial structure, which runs parallel to the civilian government. This structure is divided into 12 territorial commands that are further subdivided into town, district and village levels. The army also has two main central commands: the Army Strategic Reserve with 27,000 men and its Special Forces with 3,500. The army faces regular shortages of ammunition, transport vehicles and aircraft, with only half of the army’s aircraft operational at any one time.

The Indonesian navy has 62,500 personnel and is divided into an Eastern Fleet based in Surabaya and a Western Fleet based in Jakarta. Like the army, the Indonesian navy is woefully short of equipment: Of its 207 vessels, only 157 are operational. The Indonesian air force has 33,900 personnel divided into two operational commands — one in Sulawesi covering the eastern part of the country and the other in Jakarta — as well as seven airbases. Its current strength consists of 5 combat squadrons, 2 helicopter squadrons and 3 training squadrons. The operational readiness of the air force is below 60 percent, and most of its equipment is between 25-40 years old, sourced at the height of the U.S.-Indonesian military partnership.

Military spending was slashed during the 1997-1998 financial crisis, and although it has risen from $2.37 billion in 2005 to $4.18 billion in 2010, it accounts for a paltry 0.78 percent of GDP. Combined with the suspension of U.S. military sales, the decrease in military spending severely degraded Indonesia’s military capacity. Despite the need to upgrade capacity, acquisition budgets are a relatively small percentage of defense spending, with 65 percent of defense funds in recent years going to routine salaries and administration. As a result, with Asia in the midst of an arms race, Indonesia continues to have one of the region’s weakest militaries; tiny Singapore spends twice as much on defense as Indonesia.

Efforts to enhance Indonesia’s military strength have also been hampered by resource constraints, which are partly a function of politics. Since Indonesia’s democratic opening in 1998, reforming the military and bringing it under civilian control has been a key objective of political reformers. Enhancing its capacity has not. Furthermore, the TNI traditionally funded a significant portion of its budget from an empire of military-run businesses. Although a 2004 law required the TNI to transfer these businesses to the state by 2009, the TNI succeeded in making military cooperatives and many military foundations exempt, while also selling many profitable businesses. The Indonesian parliament’s knowledge that the TNI continues to have access to off-budget financing is one reason that it has never funded the military at the level the Defense Department contends is required to meet the country’s minimum defense needs.

The resulting financial constraints have forced the TNI to look to foreign suppliers willing to finance big-ticket purchases. As a result, Russia — considered reliable because it is unlikely to condition military sales on human rights issues — has become Indonesia’s largest defense supplier. In 2007, Russia provided $1 billion in credit facilities that Indonesia used to purchase Sukhoi fighter jets, and Indonesia intends to purchase an additional 180 fighters over the next 20 years. It has also taken delivery of 4 Mi-24 assault helicopters and made provisions to purchase two Kilo-class diesel engine submarines. Despite the normalization of U.S.-Indonesian military ties, the U.S. arms embargo has led Indonesia to view the U.S. as an unreliable supplier. Indonesian procurement from the U.S. will therefore likely focus on refurbishing older equipment, particularly Hercules C-130 transport planes.

Maritime security, humanitarian and disaster relief, and terrorism are identified as areas of increasing concern in the country’s 2008 Defense White Paper. As an archipelagic state, Indonesian sovereignty extends not only over its islands, but also to the waters connecting them. For Indonesia, whose word for homeland is “tanah air” (literally “soil and water”), protecting the sovereignty of its waters is critical to national defense.

For their part, other countries have a strategic interest in ensuring the safety of and freedom of navigation through these Sea Lanes of Communication (SLOCs), particularly the Malacca Straits, the world’s busiest waterway. A few years ago, Indonesian waterways ranked among the world’s most pirated. That, combined with heightened concerns over the threat of seaborne terrorism led the U.S. to propose a regional maritime security initiative. The proposal triggered storms of protest from Indonesia, which rejected any military role for external powers in its territorial waters. Since then, the littoral states of the Malacca Straits — Indonesia, Malaysia and Singapore — have undertaken joint patrols, and piracy has declined dramatically.

Beyond the SLOCs, Indonesia is increasingly concerned about foreign encroachment in its waters. First, Indonesia is concerned about its waterways serving as conduits for illicit activities, such as drug and people trafficking. Second, Indonesia is concerned about illegal fishing by foreign parties, which costs Indonesia $3 billion annually. Third, Indonesia is concerned about overlapping territorial claims to islands and exclusive economic zones (EEZs). Stunned when the International Court of Justice awarded sovereignty of two disputed islands to Malaysia in 2002, Indonesia has vowed never to lose another island or sea block. In recent years, competing claims to the Ambalat sea block has led to naval skirmishes with Malaysia. China does not claim sovereignty to any Indonesian islands, but its claims to the South China Sea include waters in Indonesia’s Natuna Island EEZ. In July 2010, Indonesia protested China’s claim at the U.N. As an archipelagic state lacking the naval capacity to protect itself, Indonesia has a strong interest in ensuring that naval powers abide by the United Nations Convention on the Law of the Sea (UNCLOS).

Terrorism is a relatively new threat for Indonesia. Since the October 2002 Bali bombings perpetrated by Jemaah Islamiya (JI), a Southeast Asian terrorist group with links to al-Qaida, Indonesia has adopted what is regarded as one of the world’s most successful counterterrorism programs. Indonesia adopted a “soft” or law enforcement policy that focused on the investigation, arrest and legal prosecution of terrorists, largely avoiding the use of torture and harsh interrogation techniques that Indonesian officials believe provide fuel for terrorist recruitment. As a law enforcement issue, the police, not the military, are responsible for counterterrorism. Since 2002, hundreds of terrorists have been killed, arrested or jailed, and JI’s command and control structure has been severely degraded.

Consequently, the nature of terrorism is changing in Indonesia, as JI has been supplanted by smaller jihadist groups with shifting alliances that make them more difficult to track. In contrast to JI, which always wanted to be an integral part of the global Salafi network, the new groups are more parochial and consider Indonesian state institutions to be as much as a threat as Western ones. Reflecting this shift, in 2010, the only Indonesian deaths due to terrorism were 10 policemen. Precisely how this change will affect the severity of the terrorist threat to Indonesia remains to be seen.

Indonesia sits on the so-called ring of fire, making it extremely vulnerable to natural disasters. The tsunami that hit Aceh in December 2004 and devastating earthquakes that struck central Java in 2005, Benkulu in 2007 and West Sumatera in 2009 led to massive loss of life. Annual flooding displaces many. Indonesia’s goal is to create a rapid response team to minimize casualties and oversee recovery efforts.

Strategic Priorities

In contrast to the significant shifts in its foreign policy, Indonesian strategic priorities have changed little and remain regionally focused. Indonesian security officials traditionally described their grand strategy in terms of concentric circles aimed at creating a cordon sanitaire around the country. Domestic security, still Indonesia’s major security concern, occupied the first circle. Regional security in Southeast Asia was a vital interest and occupied the second circle. The third circle encompassed the wider Asia-Pacific and the great powers.

Indonesia’s key interest in Southeast Asia is promoting regional stability and ensuring that the region retain its autonomy. Indonesian officials seek to achieve this by engaging outside powers — such as the U.S., China, Japan, India and South Korea — in organizations built upon ASEAN, including the ASEAN Regional Forum and East Asia Summit, both created to extend ASEAN norms in the broader Asia-Pacific. The former provides a forum for security dialogue, and membership in the latter requires adherence to ASEAN’s Treaty of Amity and Cooperation, which calls upon signatories to renounce the use of force and resolve differences peacefully. Ensuring that regional architecture is built upon ASEAN gives its members agenda-setting influence and helps prevent their domination by larger powers, making it a key Indonesian interest.

With the Asia-Pacific in the midst of a power transition, retaining ASEAN centrality and hence Indonesian influence will likely become increasingly difficult. Normally, regional institutions are created and run by large states. Tensions between Asia’s major powers created the opening for ASEAN. Retaining ASEAN centrality will require balancing the interests of these larger powers, something that is possible only if they value the status quo and do not harbor revisionist ambitions.

Indonesia is concerned about China’s development of a blue-water navy, its claims to virtually the entire South China Sea and its designation of those claims as a “core” interest on par with Taiwan and Tibet. The latter stance is viewed as signaling an unwillingness to negotiate the issue and a willingness to use force. China’s increasingly assertive behavior — including harassment of the USS Impeccable, detention of Japanese boats off the disputed Senkaku islands, construction of bunkers on islands claimed by the Philippines and the cutting of survey cables of Vietnamese exploration ships — appear to indicate a policy of deterrence and denial through the South China Sea. This is antithetical to Indonesian interests.

China bases its claims on historical grounds, not legal ones. With the exception of Taiwan, the remaining disputants — Vietnam, Malaysia, Brunei and the Philippines — claim specific islands and the waters around them, not the entire sea. China refuses to negotiate multilaterally, instead seeking bilateral agreements for joint development, a format that would obviously enhance its bargaining power. Recent U.S. policy statements that it has a vital interest in freedom of navigation through the South China Sea and wants to see a resolution to territorial disputes according to UNCLOS triggered an angry response from China. Indonesia increasingly views China’s behavior in the South China Sea as a signal of whether China will be a responsible international stakeholder or revisionist power as it rises.

Indonesia will be walking a diplomatic tightrope on the South China Sea issue as host of the November 2011 East Asia Summit. The U.S. has conducted bilateral naval exercises with Vietnam and the Philippines that China argues are provocative. Many in China believe that these exercises are part of an American soft containment policy against China. For Jakarta, managing not only Sino-American tensions but also the diverse interests of fellow ASEAN members to prevent escalation is a challenge that highlights the difficulty of retaining Indonesia’s influence when the interests of larger powers diverge.

Beyond Asia, Indonesia’s religious composition and terrorist challenge give it an interest in the Middle East. Indonesian officials believe that radicalism there exacerbates radicalism at home. Since Islam calls upon its followers to redress injustice against Muslim victims of violence, events such as the war in Iraq and Israeli military actions against Palestinians and Lebanon create strong domestic pressures on the government to “do something.” Indonesian leaders have worked hard to separate terrorism from religion in public opinion, but aggression by non-Muslims in the Middle East creates an opening for radicals to present an alternative narrative. Resolution of the Palestine issue is Indonesia’s key strategic interest outside of Asia.


Indonesia exhibits classic middle-power diplomacy, with an emphasis on soft power and strong support for international organizations and law. What makes Indonesia rather unique is its membership in a number of important global communities: Though geographically located in Asia, it is part of the broader Muslim world, the developing world and the community of democracies. Its ability to navigate between these important constituencies in the service of international peace and prosperity is what makes Indonesia such a potentially valuable international player.

Indonesia’s lack of hard power means it cannot defend itself nor pursue key strategic interests independently. Over the past decade, relations between great powers in the Asia-Pacific were largely cordial, creating a permissive environment for Indonesia. If tensions in the region continue to rise, Indonesia may face increasing challenges to its key strategic interests of defending its territorial waters, promoting stability in Southeast Asia and ensuring the region’s autonomy from outside powers.

Ann Marie Murphy is associate professor, Seton Hall University; adjunct research scholar, Weatherhead East Asian Institute, Columbia University; fellow, the National Asia Research Program; and associate fellow, the Asia Society.

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