Prabowo Subianto’s Pragmatic Diplomacy: How Indonesia Balances Geopolitics and Growth

Despite facing several global challenges and economic problems at home, Prabowo’s proactive and pragmatic foreign policy has sought to steer Indonesia through a turbulent geopolitical landscape successfully.

In recent years, Indonesia has deftly navigated several geopolitical challenges. The ASEAN nation has maintained its traditional commitment to a balanced foreign policy, particularly in the context of the Russia-Ukraine conflict. Indonesian President Prabowo Subianto has continued this approach, seeking cordial relations with both the US and China.

While Prabowo’s decision not to attend the G7 Summit in Canada, earlier this year, was viewed as a signal of Indonesia moving away from the West, he emphatically stated, “Don’t read too much into it,” emphasising that this was due to prior commitments. Shortly after taking over as President, Prabowo Subianto visited both the US and China in November 2024. Despite facing several global challenges and economic problems at home, Prabowo’s proactive and pragmatic foreign policy has sought to steer Indonesia through a turbulent geopolitical landscape successfully.

US-Indonesia relations: The economic dimension

The US and Indonesia recently agreed to a trade deal that includes 19% tariffs on goods from Indonesia. US President Donald Trump hailed the agreement as a win-win for American farmers, announcing that, “As part of the Agreement, Indonesia has committed to purchasing $15 billion worth of US Energy, $4.5 billion in American Agricultural Products, and 50 Boeing Jets, many of them 777s.”

US Commerce Secretary Howard Lutnick, while commenting on the agreement, remarked, “No tariffs there. They pay tariffs here, switching the asymmetry our way. Let’s bring industry back, and that’s going to unleash our farmers, our ranchers, our fishermen, and our industries.”

Also Read: Indonesia’s Pragmatic Foreign Policy

Indonesian President Prabowo Subianto, while commenting on the agreement, said, “Together, we agreed and concluded to take trade relations between Indonesia and the United States into a new era of mutual benefit between our two great nations.”

Indonesia’s important role in BRICS

Indonesia, which entered BRICS in 2025, is also likely to be a proactive player in BRICS. India, which will take over the Chairmanship of BRICS+ in 2026, has, like the ASEAN nations, charted an independent foreign policy path. India’s purchase of oil from Russia in the aftermath of the Russia-Ukraine war has been a major bone of contention in India-US relations, with the US President imposing 50% tariffs on India in response.

Meanwhile, Jakarta and New Delhi have traditionally shared a cordial relationship, with a renewed emphasis on strengthening economic and strategic cooperation. This was evident during Indonesian President Prabowo Subianto’s state visit to India from January 23–26, 2025. Prime Minister Narendra Modi has welcomed Indonesia’s entry into BRICS. Beyond bilateral engagement, the two nations are also working more closely on multilateral platforms, particularly on issues concerning the Global South.

Economic challenges

The ASEAN region, like other regions, is facing several changes due to the uncertain global geopolitical situation, particularly due to deteriorating China–US relations and the tariffs imposed by the US. Countries like Malaysia and Singapore have repeatedly flagged the adverse impacts of both issues. Indonesia, like other ASEAN nations, is not insulated from the impact of the uncertain and unpredictable geopolitical and economic landscape.

The country faces a serious problem of unemployment- 16% of the youth in the age group of 15-24 years remain unemployed. Reports indicate that Indonesians are growing increasingly pessimistic compared to citizens of other ASEAN countries.

Notably, foreign direct investment (FDI) into Indonesia fell by 6.95% year-over-year in the second quarter, even as FDI into ASEAN countries overall rose by 12% in the first quarter of this year.

Also Read: ASEAN member states’ engagement with BRICS: Opportunities and Roadblocks

Despite several economic challenges, the economic growth recorded in the quarter would have come as a relief to ASEAN nations. Indonesia’s GDP growth in the second quarter surpassed 5%, well above forecasts. However, analysts caution that it is premature to draw firm conclusions from these figures; the Indonesian economy is not immune to global economic turbulence and unpredictability. It also remains to be seen whether Jakarta will place greater emphasis on diversifying its economic linkages.

In conclusion, Indonesia has sought to navigate a shifting geopolitical and economic order with relative success. The ASEAN nation is poised to play a significant role on the global stage as an important voice of the Global South. Nevertheless, it is likely to face its share of challenges — both economic, as discussed earlier, and geopolitical.

Disclaimer: The views expressed in this article are of the authors solely. TheRise.co.in neither endorses nor is responsible for them. Reproducing this content without permission is prohibited.