After 75 years of diplomatic relations, Australia and Indonesia signed a new defense cooperation agreement on August 28, 2024, during the visit of Australian Defense Minister Richard Marles to Jakarta. This came just one week after the visit of Indonesian Defense Minister and President-elect Prabowo Subianto to Canberra, where he met with Australian Prime Minister Anthony Albanese.
Although the specific details of the agreement have not yet been disclosed, Marles indicated that it would facilitate joint military exercises and interoperability between the defense forces of both countries. It would also strengthen cooperation in maritime security between the two nations, which share one of the longest maritime borders in the world. Albanese stated that the new agreement aims to bolster security cooperation in a region increasingly tense and constrained, likely a subtle reference to China’s activities in the South China Sea.
Prabowo described the signing of the agreement as a historic event but emphasized that it is not a military alliance between the two countries. Instead, its purpose is to enhance cooperation to help both parties overcome various security threats and promote sustainable peace and stability in the Asia-Pacific region.
Motivations Behind the Agreement:
This new defense agreement builds on the long-standing and evolving relationship between Indonesia and Australia, shaped by geographic proximity and mutual interests in regional stability. The primary motivations for signing this agreement are as follows:
Strengthening Defense and Security Cooperation: Historically, defense relations between Indonesia and Australia have focused on maritime security, counterterrorism, and regional stability. This cooperation dates back to June 1994 when Australian Prime Minister Paul Keating proposed formalizing defense relations during his visit to Jakarta. On December 18, 1995, the two countries signed their first security agreement, marking the first of its kind for Indonesia with any other nation.
The Lombok Treaty, signed in 2006 and effective since February 2008, set the framework for both countries to address traditional and non-traditional security challenges. The 2012 defense cooperation agreement further laid the foundation for deeper security collaboration, particularly in responding to non-traditional threats such as human trafficking and drug smuggling. In recent years, the Indonesian Coast Guard and Australian Border Force have intensified their cooperation in maritime security and safety. Relations between the two countries have also improved since President Joko Widodo took office in 2014, with the Comprehensive Economic Partnership Agreement coming into force in 2020.
Militarily, Australia has participated in the annual Super Garuda Shield joint combat exercises between Indonesia and the United States since 2022, alongside Japan and Singapore. In May 2024, the Royal Australian Air Force and the Indonesian Air Force conducted joint maritime surveillance exercises in Bali, following an air combat training mission in North Sulawesi in September 2023. Additionally, Australia recently provided Indonesia with 15 Bushmaster Protected Mobility Vehicles to support its participation in UN peacekeeping missions.
China’s Rising Activity in the South China Sea: The South China Sea has become a hotspot for geopolitical competition due to overlapping territorial claims and conflicting strategic interests. China’s assertive territorial claims and militarization of artificial islands have heightened tensions with Southeast Asian countries. Australian leaders often view close security ties with Indonesia as an effective counterbalance to China’s growing influence in Asia, particularly among those who question the long-term reliability of the United States as a security partner. Indonesia’s strategic position in the Indo-Pacific, covering the northern part of Australia, and the fact that over 60% of Australia’s exports pass through the region, make it one of Australia’s most important neighbors.
For Indonesia, Australia is a “first priority” country and is classified as a comprehensive strategic partner under Indonesia’s 2019-2024 military diplomacy plan. The new agreement strengthens Indonesia’s strategic position amid overlapping territorial claims in the South China Sea. According to the 2024 Southeast Asia State of the Region Survey, around 57% of Indonesians remain wary of China’s regional influence due to bilateral maritime disputes in the North Natuna Sea, broader tensions in the South China Sea, and historical suspicions of Chinese interference in Indonesian politics.
The Election of Prabowo Subianto: With the election of Prabowo Subianto as Indonesia’s new president in February 2024, Canberra sees an opportunity to deepen ties with Jakarta. In the past, Prabowo has taken a more lenient stance compared to other Indonesian leaders on controversial Australian foreign policy decisions, such as its participation in the AUKUS agreement with the United States and the United Kingdom. His military background and strong nationalism also make him inclined toward defense diplomacy.
Although Prabowo has not yet officially assumed office, his past statements and political leanings suggest a strong focus on enhancing Indonesia’s military capabilities and asserting its strategic interests. During his first 18 months as defense minister, Prabowo made 20 foreign visits to 14 countries in an effort to formulate a 25-year defense procurement plan. While his predecessor, Ryamizard Ryacudu, concentrated on internal security issues like terrorism and piracy, Prabowo shifted focus toward increasing military spending, strengthening Indonesia’s external defense capabilities, and deepening security cooperation with neighboring countries.
Challenges Facing the Agreement:
Despite Indonesia being a vast archipelagic nation with a population of over 270 million and the third-largest democracy in the world, it is often presented as one of Australia’s most important neighbors and strategic allies. However, the relationship between the two countries has not always been smooth, which could pose some challenges to the development of their defense relations. Some of the key challenges include:
Indonesia and Australia’s history of turbulent relations is a significant factor. Both countries have signed previous security treaties, such as the Suharto-Keating Pact in 1995, signed by Indonesian President Suharto and Australian Prime Minister Paul Keating. However, Jakarta canceled the agreement in September 1999 due to what it saw as Australian involvement in the East Timor crisis. Further security agreements were signed in 2006 and 2012, but Indonesia suspended them after revelations in 2013 that Australia had tapped the phone of then-Indonesian President Susilo Bambang Yudhoyono, his wife, and other senior officials.
When the AUKUS agreement was announced in September 2021, Indonesia’s Ministry of Foreign Affairs released a statement expressing doubts about the agreement and concerns over its objectives. The statement warned that Australia’s use and development of nuclear technology could negatively impact Indonesia and other countries in the region by polluting marine ecosystems. Regardless of Defense Minister Prabowo Subianto’s stance on the AUKUS agreement, it will continue to unsettle many of Jakarta’s foreign security and political elites.
Indonesia’s commitment to a policy of neutrality is another key issue. While the new agreement indicates the current strength of relations between Australia and Indonesia, with both sides aligning strategically, especially in the face of geopolitical shifts caused by China’s rise, the two countries interpret China’s ascent in very different ways. While Australia emphasizes its alliance with the U.S. to counter China, Indonesia maintains its independent and non-aligned foreign policy, which it has upheld since gaining independence.
Although Subianto praised the new agreement during his visit to Australia on August 20, 2024, as a major development for both nations, he was careful to stress that it would not endanger Indonesia’s traditional neutrality. This is reflected in the fact that after winning the presidential election in early April 2024, he chose China as the destination for his first foreign visit. He highlighted China as a key partner for Indonesia and pledged to continue the policies of former President Joko Widodo. The new government will continue to support cooperation between the two countries, especially as China has been Indonesia’s largest trading partner over the past decade, with trade volume rising from $68 billion in 2013 to $149 billion in 2022. During this visit, Subianto also met with Chinese Foreign Minister Wang Yi to discuss military exchanges and the resumption of joint training, which had been suspended since 2015 due to disputes over the North Natuna Sea.
Furthermore, in early August 2024, Subianto visited Russia, a key defense procurement partner for Indonesia. This visit, along with the decision to resume joint military training with China, confirms that Indonesia is not aligning with the U.S. and its allies in the Indo-Pacific region, including Australia, for the time being.
Mutual bilateral concerns also persist. There are still lingering doubts within Indonesia’s political elite about Australia’s intentions. Maritime border disputes have historically characterized relations between the two countries, particularly in the latter part of the 1980s. While maritime arrangements were signed in the Timor Sea in 2006, permanent boundaries have yet to be established. Many Indonesians still remember Australia’s intervention in East Timor in 1999 and its stance in support of the separatist movement in Papua New Guinea. Indonesian officials have also pointed out that Australia has a “long” history of preventing asylum seekers from reaching its shores and returning them to Indonesia.
On the other hand, there are Australian concerns regarding Indonesia’s new president, especially due to his involvement in East Timor when he served as a general in Indonesia’s elite military forces, Kopassus. Subianto may react negatively to Australian media criticism, which could affect bilateral relations.
Finally, there are increasing regional concerns. The implications of this agreement extend beyond bilateral relations and impact the broader geopolitical landscape. China is likely to view stronger defense ties between Indonesia and Australia with suspicion, perceiving them as part of a Western strategy to counter its influence. This perception could escalate tensions and lead China to reconsider its approach to the South China Sea, potentially exacerbating regional conflicts. Conversely, the U.S. is expected to view the agreement favorably as it aligns with its strategic interests in maintaining a free and open Indo-Pacific.
In conclusion, the new defense agreement between Indonesia and Australia represents significant progress in their bilateral relations with far-reaching consequences for regional security. While it strengthens military cooperation and may be seen in a broader context as part of building new security alliances among U.S. allies in Asia, it also presents risks of potential regional tensions and countermeasures from China. One of the key challenges facing Indonesia’s new president, Prabowo Subianto, will be to strike a balance between enhancing defense capabilities and managing economic relations with China.
