PM Modi and President Subianto Focus on Strengthening India-Indonesia Economic Relations
Prime Minister Narendra Modi and Indonesian President Prabowo Subianto have committed to enhancing economic cooperation between the two nations. Their discussions covered a wide range of topics, including trade relations, digital infrastructure, renewable energy, and connectivity, marking an important step forward in India-Indonesia relations.
During their meeting, both leaders emphasised the importance of resolving trade barriers through various platforms, such as the Working Group on Trade and Investment (WGTI) and the Biennial Trade Ministers’ Forum (BMTF). The aim is to build on the current trade momentum, which reached a record USD 38.8 billion between April 2022 and March 2023. The leaders also expressed their shared commitment to concluding the review of the ASEAN-India Trade in Goods Agreement (AITIGA) by 2025, which would further streamline trade and strengthen economic ties. In the digital domain, the two leaders discussed a range of initiatives to promote digital public infrastructure, including cyber security, digital capacity building, and B2B partnerships. Both countries are keen on collaborating on emerging technologies like high-performance computing and quantum communication. India offered to share its expertise in implementing large-scale digital solutions, which could significantly accelerate Indonesia’s digital transformation. The signing of an MoU on Cooperation in Digital Development during President Subianto’s visit is expected to pave the way for enhanced cooperation in these areas.
A major milestone in the bilateral engagement was the MoU signed between the Reserve Bank of India and Bank Indonesia on Local Currency Settlement Systems (LCSS). This agreement, which aims to promote the use of local currencies in trade transactions, will further integrate the economies of the two nations, reducing reliance on foreign currencies and enhancing financial stability. Both leaders expressed confidence that the implementation of this MoU would create new opportunities for trade and financial cooperation. Energy security was another key focus area, with both leaders recognising the importance of renewable energy and the role it will play in addressing global challenges. They reaffirmed their commitment to achieving their respective renewable energy goals, with a special focus on joint exploration and mining projects related to critical minerals such as nickel, bauxite, and silica. These resources are vital for both countries’ energy transitions and future energy security. The collaboration on biofuels was also highlighted, as both leaders acknowledged the role of biofuels in decarbonising transportation and other sectors.
Connectivity and people-to-people exchanges were also major talking points. Both leaders welcomed the restoration of direct flights between India and Indonesia, which they believe will foster closer ties in tourism and business. In addition, they expressed support for expanding the bilateral Air Services Agreement, reflecting the growing demand for travel between the two countries. The bilateral discussions were also enriched by the 3rd CEOs Forum, which was held during the visit. This platform allowed business leaders from both nations to explore new avenues for investment and cooperation, further strengthening the economic relationship between India and Indonesia. The state visit of President Subianto to India marks a new chapter in India-Indonesia relations, with both leaders committed to a partnership built on mutual respect, shared values, and collaborative efforts to tackle global challenges. As both nations continue to strengthen their economic, digital, and energy ties, they are poised to unlock new opportunities for growth and development in the years to come.
