Indonesia, India to strengthen defence and economic ties

Indonesian President Joko Widodo accompanying Indian Prime Minister Narendra Modi as the latter was given a rousing welcome at the Merdeka Palace in Jakarta yesterday. Mr Modi is on his first official visit to Indonesia.
Indonesian President Joko Widodo accompanying Indian Prime Minister Narendra Modi as the latter was given a rousing welcome at the Merdeka Palace in Jakarta yesterday. Mr Modi is on his first official visit to Indonesia.PHOTO: REUTERS
Mr Joko and Mr Modi flying kites to mark the 70 years of diplomatic ties next year, in a symbolic gesture of hope for ties to scale new heights.
Mr Joko and Mr Modi flying kites to mark the 70 years of diplomatic ties next year, in a symbolic gesture of hope for ties to scale new heights.PHOTO: EPA-EFE

Indonesia and India have agreed to step up their cooperation in a broad range of areas, particularly defence and economy, following a meeting between President Joko Widodo and Prime Minister Narenda Modi at the Merdeka Palace yesterday.

Mr Modi is on a three-day visit, his first official one to Indonesia.

After their meeting, Mr Joko said both leaders had reached an agreement to advance maritime cooperation, particularly in the context of the Indo-Pacific strategy, referring to an emerging alliance between India, the United States, Australia and Japan that some say is a means to contain China.

The two leaders also agreed to develop infrastructure and enhance connectivity, especially on Sabang Island, Indonesia's westernmost territory, and India's Andaman Islands, as well as to carry out joint manufacturing of products in the defence industry, including a water cannon that both countries are developing.

Maritime cooperation between Indonesia and India has so far involved naval exercises and patrolling between the Andaman Sea and Malacca Strait.

"We agree to step up our strategic partnership to comprehensive strategic partnership and, with that, bilateral relations between Indonesia and India will become stronger and better," Mr Joko said in a joint statement with Mr Modi.

"This steady relationship will not only benefit citizens of both countries, but also the stability and welfare in the region," he added.

Turning to trade, Mr Joko said Indonesia had requested that India address the issue of high import duty on palm oil.

Indonesia is the world's top producer of palm oil, and India is now its largest buyer of the commodity.

Indonesia is also expecting more Indian investments for its infrastructure building programme, including in seaports and airports, and the pharmaceutical industry, said Mr Joko.

Yesterday, both leaders witnessed the signing of nine agreements in the area of defence, infrastructure, pharmaceuticals, health and science and technology.

Mr Modi, for his part, underlined that, as strategic partners, Indonesia and India had similar interests to ensure maritime security and maintain their strategic position in the Indo-Pacific region, as well as guarantee economic development in the area.

"We are facing similar changes in the Indo-Pacific. We must keep working together to guarantee our common welfare," he said.

Mr Modi also underlined both countries' commitment to boost bilateral trade to US$50 billion (S$67 billion) by 2025.

India is Indonesia's biggest trading partner in South Asia and its fourth-biggest trading partner in the world. Two-way trade reached US$18.13 billion last year, up nearly 40 per cent from a year earlier. Indonesia enjoyed a surplus of US$10.04 billion in bilateral trade, according to data from its Trade Ministry.

During the Indonesia-India CEO Forum on Tuesday, the Indonesian Chamber of Commerce and Industry and its Indian counterpart, Confederation of Indian Industry, inked a deal to intensify cooperation in four areas: manufacturing, mining, pharmaceutical and infrastructure.

Mr Joko and Mr Modi yesterday flew kites to mark the 70 years of diplomatic ties next year, in a symbolic gesture of hope for ties to scale new heights.

Correction note: An earlier version of the story stated that the bilateral trade increase was 22.34 per cent. It should be nearly 40 per cent. We are sorry for the error.

A version of this article appeared in the print edition of The Straits Times on May 31, 2018, with the headline 'Indonesia, India to strengthen defence and economic ties'. Print Edition | Subscribe