Narendra Modi's visit to Jakarta expands the window for closer ties

Prime Minister Narendra Modi’s tour to Indonesia, which begins today, offers India a critical opportunity to reverse the benign neglect of relations between the two Indian Ocean neighbours. This trip marks the first official visit by Mr Modi in return for a state visit by Indonesian President Joko Widodo to India in December 2016, and is important for the multiple geo-strategic signals it sends out. Now that the Cold War paradigm, which put the two countries on opposite sides of global power equations, is a thing of the past, this meeting reflects a better understanding of the urgent need to forge a balance of power equation within the wider Indo-Pacific region at a time when China is flexing its muscles.

Both nations have stakes in this balancing act. India has had to contend with China’s expanding presence on its land and sea borders. Although Indonesia is not directly affected by China’s incursions in the South China Sea, the latter’s claims come perilously close to the former’s sea borders and represent a future threat. Mr Widodo has also not been an enthusiastic participant in the Belt and Road Initiative once it became clear that much of it depended on hefty Chinese loans. Closer relations with India offer a useful counterweight not just in terms of offering a geo-strategic balance but also in fulfilling Mr Widodo’s current focus on augmenting Indonesia’s infrastructure. Indeed, it is significant that about ten days before Mr Modi’s visit, the India-Indonesia Infrastructure Forum (IIIF), jointly organised by the Indian embassy in Jakarta and Indonesia's Coordinating Ministry for Maritime Affairs, held its first meeting in the Indonesian capital. The meeting was attended by 30 CEOs from leading Indian companies, reflecting investment opportunities for corporate partnership. A meeting of the Indonesia-India CEO Forum is also planned during Mr Modi’s visit, and a joint recommendation is to be submitted to Messrs Widodo and Modi.

These meetings are taking place against indications from Jakarta that India would be allowed access to the island of Sabang to invest in a port and economic zone. Sabang, on the tip of one of Indonesia’s larger islands, offers proximity to the critical shipping lanes along the Straits of Malacca, and reflects Mr Widodo’s stated ambition of turning his country into a “major maritime fulcrum”. As always, the success of this concession depends largely on India’s ability to implement its plans — its record with infrastructure projects in Myanmar and Bangladesh do not inspire confidence in this respect. The chances of achieving a constructive alliance centred on the Indian Ocean appear opportune not least because Indonesia and India enjoy some unique sources of commonality. The ancient Hindu cultural heritage is the best known and feted of them. But modern-day cohesion is just as durable and visible. The principal one is the large Indian corporate presence — the Birlas, the TVS group and Indo-Rama, for example – in Indonesia. No less noticeable is the large presence of Indian managerial and professional talent hired by multinationals operating in Indonesia. Taken together with the historical presence of a settled ethnic Indian trading community with links dating back centuries, the portents for a vibrant partnership between the largest economy in South East Asia and the largest country in South Asia are strong.

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