ASIATODAY.ID, JAKARTA — Indonesian President Prabowo Subianto on Monday welcomed Indian Prime Minister Narendra to Jakarta for a three-day state visit aimed at expanding cooperation across trade, investment, defense, and strategic industries.
In a ceremonial gesture underscoring the importance Indonesia attaches to its relationship with India, Modi’s aircraft was escorted into Indonesian airspace by three F-16 fighter jets and two Sukhoi fighter aircraft before landing at Halim Perdanakusuma Air Force Base.
Prabowo personally received the Indian leader at the foot of the aircraft stairs, where the two leaders exchanged greetings before proceeding through an official welcome ceremony featuring a military honor guard, traditional Indonesian cultural performances, and a six-gun salute.
The visit marks Modi’s second trip to Indonesia since 2018 and comes as Southeast Asia’s largest economy and the world’s fastest-growing major economy seek to elevate their Comprehensive Strategic Partnership amid shifting geopolitical and economic dynamics across the Indo-Pacific.
A key focus of the visit is strengthening economic integration through a Local Currency Settlement (LCS) framework being developed by Bank Indonesia and the Reserve Bank of India. Once operational, the mechanism is expected to reduce transaction costs, facilitate bilateral trade and investment, and provide businesses with an additional settlement option alongside existing international payment systems.
According to Indonesian Deputy Chief of Mission Yudho Sasongko, the two central banks are finalizing the operational arrangements for the initiative. Both countries are also exploring QR code payment interoperability to simplify retail transactions for tourists and business travelers.
Beyond financial cooperation, Jakarta and New Delhi are expanding collaboration in critical minerals, rare earths, downstream metals, steel manufacturing, renewable energy, electric vehicle battery production, pharmaceuticals, medical devices, digital technologies, food processing, and maritime connectivity.
Indonesia’s abundant nickel and other mineral resources, combined with India’s rapidly expanding manufacturing sector, provide a strong foundation for building more resilient and diversified supply chains supporting the global clean energy transition and advanced manufacturing industries.
The leaders are also expected to hold bilateral talks at the Presidential Palace to discuss cooperation in defense, maritime security, investment, technology, education, and regional affairs, reflecting the broadening scope of the Indonesia–India strategic partnership.
Since establishing diplomatic relations in 1951, Indonesia and India have steadily expanded cooperation as two of Asia’s largest democracies. Both countries increasingly view one another as indispensable partners in promoting economic resilience, maritime security, and sustainable growth across the Indo-Pacific.
According to official data, bilateral trade reached approximately US$28.16 billion during India’s fiscal year 2024–25. India imports coal, palm oil, iron, and steel from Indonesia, while Indonesia’s cumulative foreign direct investment in India totaled US$659.3 million between April 2000 and March 2025.
The expanding partnership reflects a broader trend among emerging economies to strengthen the use of local currencies in bilateral trade while reinforcing strategic cooperation in supply chains, clean energy, and regional connectivity.
Rather than replacing the US dollar, such initiatives are intended to improve transaction efficiency, broaden settlement options, and enhance financial resilience in an increasingly multipolar global economy. (AT Network)
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