For much of April and into May, a team of negotiators from Indonesia have been in Washington to discuss trading relations between the world’s largest economy and another forecast to be in the Top 5 within a generation.
The Southeast Asian nation was among those hit hard by the across-the-board tariffs announced on April 2, 2025, by President Donald Trump, with a proposed 32% levy on its exports to the US. Trump subsequently backpedaled, putting in place a 90-day pause on any additional tariffs beyond a new 10% minimum.
So far, Indonesia, whose second-largest export market is the United States, has signaled its intent to negotiate rather than respond with countermeasures like some other countries targeted by Trump, such as China and Canada.
Indonesia may even offer to relax protectionist policies aimed at boosting domestic manufacturers as a concession. “People who have known me for a long time would say I’m the most nationalist person … but we have to be realistic,” said President Prabowo Subianto.
The issue of Trump’s tariff policy is a major early test for Subianto, a right-wing populist whose worldview was shaped by decades of military experience. He views Indonesia and its place in the broader world through a lens of realist power politics – wanting to ensure Indonesia possesses adequate hard military power and robust economic performance.
Through pushing both, Subianto hopes to ensure that Indonesia is not easily swayed by foreign influence and can avoid domestic discontent due to any economic malaise.
His approach to ruling the nation of over 280 million people is driven by a desire to retain friendly relations with the United States and China by maintaining close economic and security cooperation with both.
Good neighbors, multilateral expansion
Since declaring independence from the Netherlands almost 80 years ago, Indonesia’s foreign policy has been tied to a doctrine of “Bebas dan Aktif,” or “Free and Active.”
Formulated by the country’s first president, Sukarno, at the onset of the Cold War, the policy intended to keep the country officially nonaligned from any major power bloc. While moving much closer to the West and the US during the subsequent long-time authoritarian presidency of Suharto, Jakarta retained its official independent position in foreign policy.
Subianto served in the military during the reign of Suharto, who was also at one point his father-in-law. As Indonesia’s leader, Subianto has pledged to enact a so-called foreign policy philosophy of “zero enemies, one thousand friends.” That approach stems from two main considerations.
First, he seeks to secure economic agreements that will help fulfill his promise of 8% annual economic growth. Second, he aims to strengthen defense procurement and security cooperation to bolster Indonesia’s military position.
Toward multilateralism
As a part of his vision, Subianto has attempted to reframe some of the considerations that have long guided Jakarta’s foreign policy strategy.
For decades, the Association of Southeast Asian Nations, or ASEAN, has served as Indonesia’s collective security buffer, forming a crucial component of its “Mandala” – or concentric circles – foreign policy perspective.
However, the current administration has thus far appeared indifferent to using the regional body as a source of projecting power, as underscored by Indonesia’s absence from the ASEAN informal consultations on conflict-ridden Myanmar in December 2024.
That is just one of several indications that Subianto is attempting to shift Indonesia’s role from a regional actor to an active global player.
A crucial development in that more assertive approach came with the country’s accession in January 2025 to the BRICS group of nations, the first time a Southeast Asian nation has been admitted.
In a further bid to multilateral engagement, Indonesia has initiated plans to pursue membership in two transnational economic groupings: the Organization for Economic Cooperation and Development, or OECD, and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership.
Much of this inclination toward multilateral engagement is rooted in Subianto’s worldview that can be summed up as this: “If you’re not at the table, you’re likely to end up on the menu.”
Crucial relationships
And yet, despite Subianto’s broader multilateral ambitions, it is the US and China that remain the critical relationships.
During the early weeks of his presidency, Subianto made China his first overseas bilateral visit. It resulted in agreements between China and Indonesia worth up to US$10 billion, primarily focused on green energy and technology.
The visit, which was especially notable given that Jakarta appeared to move closer to China’s position on conflicting territorial claims in the South China Sea can be seen as part of a broader shift toward Beijing.
China’s massive population already serves as a lucrative export destination for Indonesian goods. Since 2016, China has been Indonesia’s biggest export market, beating out Japan and the US.
That shift is likely to pick up pace in light of Trump’s tariffs, with Jakarta seeking to offset the increasing cost of American trade. And though Jakarta has signaled neutrality regarding the wider US-Chinese dispute, officials in Jakarta and Beijing agreed in mid-April to boost mutual defense cooperation in the South China Sea.
At the same time, the US holds a particularly important place in Subianto’s mind. As a young soldier, Subianto spent time at military bases in the US, where he underwent special forces and counterterrorism training.
He was later subjected to a travel ban from the US from 2000 to 2020 on account of myriad allegations of human rights abuses related to his time in Indonesia’s special forces unit, Kopassus, which led to his being forcibly discharged from the Indonesian military in 1998.
Yet the ban was rescinded after then-President Joko Widodo appointed Subianto to be Indonesia’s defense minister, and he was subsequently invited to Washington in 2020 during the first Trump administration.
Washington was Subianto’s second official presidential visit destination in November 2024. During his trip, Subianto met with President Joe Biden to discuss Indonesia-US bilateral relations, regional security issues and various other global matters. Subianto also had a brief phone call with President-elect Trump to congratulate him on his election victory.
That relationship with Trump is likely to be a crucial one now, especially given the stakes of the mutual trading relationship.
The US is Indonesia’s second-biggest trading partner, after China. The value of trade between the two parties amounted to about $38.3 billion in 2024, with Indonesia exporting $28.1 billion to the US while importing $10.2 billion.
Seeking to avoid tariffs of 32%, an Indonesian trade delegation has been negotiating with Trump administration officials, signaling its intent to buy more American goods, make trade concessions and even lower local content requirements on Indonesian-made goods to allow more American-made components.
Promoting pragmatism
There are, of course, ongoing differences between Indonesia and the US – not only the ongoing trade issue but also other areas, including the Israel-Hamas war. Indonesia, the largest Muslim-majority country in the world, has been a staunch supporter of Palestinian rights and highly critical of Israeli policy.
Yet even here, Subianto seemingly is open to pragmatism, with reports that the Indonesian government is floating the idea of normalizing ties with Israel in a bid to ease entry into the OECD.
In a similar vein, one can expect that Subianto will opt for pragmatism in his dealings with Trump, prioritizing Indonesia’s security and defense cooperation with Washington, while sidestepping any issues that might divide them along the way.
Under Subianto, Indonesia is embarking on a foreign policy that stresses the importance of maintaining robust and active bilateral ties with the US. At the same time, it is strengthening its China relationship. And away from both, it is asserting its own independence through bolstering its position in numerous multilateral bodies.
How Subianto handles those various dynamics is likely to be a defining issue of his presidency.
Gilang Kembara is research fellow, Nanyang Technological University
This article is republished from The Conversation under a Creative Commons license. Read the original article.
