India, Indonesia Build on Shared Past

Indonesia and India have ties going back over two millennia. The influence of Indian culture and customs, especially the Sanskrit language, can be seen in all aspects of Indonesian society. In fact, Indonesia's state philosophy Pancasila draws from two Sanskrit words, "panca" meaning five, and "sila" meaning principle. Although the two countries enjoyed close ties in the period after independence, they drifted apart in later years owing to their divergent foreign policy priorities. While Indonesia inched closer to the US, India drew close to the erstwhile Soviet Union.

Indonesian President Susilo Bambang Yodhoyono's visit to India last month was a watershed moment for both countries, more so because he was the chief guest at India's 62^nd Republic Day celebrations (on 26 January). Yodhoyono's visit evoked memories of Indonesia's first President Sukarno's chief guest appearance at India's inaugural Republic Day celebrations in 1950.

India's first Prime Minister Jawaharlal Nehru was a strong supporter of Indonesia's freedom struggle from the Dutch. He organized the historic Asian Relations Conference in New Delhi in 1947 to bring together Asian nations and peoples. Indonesia sent a large contingent to this conference, the highlight of which was Indonesian Prime Minister Sjahrir's visit on the last day. Sjahrir was flown to India under dramatic circumstances, defying the Dutch blockade. Again when the Dutch took recourse to military action against the Indonesian Republic, Nehru convened a Conference on Indonesia on 20 January 1949 in New Delhi to further the cause of Indonesia's freedom.

However, it was only in the post-Cold War era, especially in the wake of India's "Look-East Policy" and its economic liberalization program that began in 1991 that India and Indonesia started drawing closer to each other once again. Economic liberalization was undertaken when India faced a severe balance of payments crisis and its foreign exchange reserves were abysmally low. The Look-East Policy was designed to reinvigorate India's historic ties with Southeast Asian and East Asian countries. Even now the island of Bali in Indonesia is predominantly Hindu, owing to its past rule by various Hindu kingdoms. In fact, this Indonesian presidential visit saw India announce its decision to establish a Consulate General of India in Bali.

India's economic liberalization program led to a turnaround in its sluggish economy and brought it closer to the Association of Southeast Asian Nations (ASEAN), of which Indonesia was a founding member. During Yudhoyono's visit to India last month, the two countries decided to set a bilateral trade target of $25 billion by 2015, up from $12 billion last year. Indian firms have already started foraying into Indonesia and have announced $15.1 billion in investments in Indonesia, while the two countries have started talks on a Comprehensive Economic Cooperation Agreement (CECA). They also signed an extradition treaty as well as a Mutual Legal Assistance Treaty, besides Memoranda of Understanding (MoUs) in education, energy, trade, science and technology.

Defense and security relations

India and Indonesia share common interests in tackling terrorism. Militant groups like Jemmah Islamiyah have carried out numerous bomb attacks in Indonesia, including the infamous 2002 bombing in Bali. Recent reports have indicated that al-Qaida militants have been trying to set up operations in Indonesia's province of Aceh. With Aceh only 90 nautical miles away from the southernmost tip of India's Andaman and Nicobar islands, this is a source of concern for India.

Keeping in mind their shared interests, India and Indonesia signed a MoU on Combating International Terrorism in July 2004, allowing for the creation of a Joint Working Group on Counterterrorism. During Yudhoyono's recent visit, the two countries also pledged to work together to share intelligence, develop more effective counterterrorism policies, increase liaison between their law enforcement agencies and collaborate in the areas of border and immigration control to stem the flow of terrorist related material, money and people.

India and Indonesia have long had close defense ties. Following the end of the Cold War, India provided spare parts, trained Indonesian pilots and serviced its Russian-made MiG-29 fighters. The two countries have institutionalized a biennial dialogue of Defense Ministers, and there are regular exchanges between the defense establishments of both countries. India has been hosting a biennial gathering of ships known as the MILAN since 1995 in which Indonesia has participated along with countries like Singapore, Thailand and Malaysia. The exercise aims to focus on how the region's naval forces can come together to mount humanitarian assistance and disaster relief operations and tackle challenges like piracy, gun and drug running and illegal immigration.

Moreover, the two countries have a deep interest in ensuring the safety of the sea lanes of communication (SLOCs) in the region around the Straits of Malacca, a key choke-point. The Indian Navy is the predominant power in the region between the Straits of Hormuz and the Straits of Malacca, home to some of the world's most important and vulnerable sea lanes of communication.

The relationship with regional behemoth China poses a challenge for both India and Indonesia. Relations between Indonesia and China have passed through some very tumultuous times, remaining frozen for 25 years following the 1965 Indonesian coup attempt, for which Indonesia incriminated China. Though their bilateral trade stood at $30 billion in 2010, Indonesia has been running huge trade deficits with China ever since the Indonesia-China Free Trade Agreement was signed in 2004. Indonesia is also wary of Chinese vessels illegally entering Indonesian waters in the South China Sea region.

Strengthening ties - the way ahead

Despite this, problems loom on the horizon due to divergent interests and aspirations. Competition for UN Security Council membership could pit the two countries against each other, and contacts on the level of civil society are not strong, despite civilizational links.

However, tourism could be one way to promote closer people-to-people ties. In a welcome move during Yudhoyono's visit India announced that it would grant visas on arrival to Indonesian citizens. The visit also saw the establishment of a group to develop a 'Vision Statement 2025' for the Indonesia-India Strategic Partnership.

Yudhoyono's visit to India is sure to take bilateral relations to new heights and give a renewed push to India's engagement with the broader Southeast Asian region. Both countries stand to gain from a closer partnership, making it imperative that they continue to seek better ties, while building on a storied past.