U.S.-Indonesia Relations

Updated March 5, 2026

U.S.-Indonesia Relations

Overview

With over 280 million citizens, Indonesia is the most

populous country in Southeast Asia, the world’s most

populous Muslim-majority nation, and the world’s thirdlargest democracy (after India and the United States). It has

the world’s 16th-largest economy—the 7th-largest when

ranked by purchasing power parity. The country straddles

vital sea lanes and borders the Strait of Malacca, one of the

world’s busiest trade routes, as well as the Indian Ocean

and the South China Sea. Over the past 25 years, Indonesia

has become a robust democracy, holding five direct

presidential elections, each considered by international

observers to have been largely free and fair. In the most

recent, held in February 2024, Prabowo Subianto, a former

defense minister who served as commander of the

Indonesian military’s special forces in the 1990s, was

elected to succeed President Joko Widodo. Prabowo took

office in October 2024 and is to serve a five-year term.

The U.S.-Indonesia relationship has broadened over the

past two decades, with closer military and counterterrorism

cooperation and a range of new educational, environmental,

and energy programs. Congress has played a key role in

guiding the relationship, including by restricting

interactions with security services accused of rights abuses,

promoting cooperation on issues such as maritime security

and counterterrorism, and conducting oversight of

assistance programs and Indonesia’s Millennium Challenge

Compact, signed in 2023. (Some of the aid is in flux given

the Trump Administration’s elimination of the U.S. Agency

for International Development (USAID).)

Prabowo, the ex-son-in-law of the country’s former

authoritarian President Suharto, as president. Prabowo is a

former general who was removed from the military in 1998

for allegedly torturing political activists and who was

implicated in 1999 violence in Timor-Leste (East Timor). A

scion of a wealthy Indonesian family who spent much of his

youth overseas, Prabowo campaigned on promises to

continue Widodo’s economic policies, including

prioritizing growth in underdeveloped regions and

promoting the mining and processing of critical minerals

important to clean-energy supply chains. He chose Jokowi’s

eldest son, Gibran Rakabuming Raka, as his vice president,

and announced a cabinet that included members of nearly

every political party in Parliament.

As president, Prabowo has implemented a range of

controversial initiatives, some of which have spurred

criticism of his administration. His government’s proposal

to cut government subsidies for schools led to large street

protests in early 2025. Some foreign policy observers

criticized him for proposals that appeared to acknowledge

China’s claims in the South China Sea for the first time.

Prabowo has also acted to strengthen relations with the

United States. Indonesia joined the Trump Administration’s

Board of Peace, and has offered to mediate in the

intensifying Middle East conflict.

Figure 1. Indonesia

Indonesia’s foreign policy is guided by its historical role as

a leader of the Non-Aligned Movement, and successive

Indonesian governments have resisted aligning too closely

with the United States or others, including the People’s

Republic of China (PRC, or China). Indonesia is an active

member in regional diplomatic institutions including the G20 and Association of Southeast Asian Nations (ASEAN).

Some 87% of Indonesians are Muslim, with the vast

majority subscribing to moderate, syncretic forms of Sunni

Islam. Religious diversity is enshrined in the constitution.

Some observers express concern about growing political

influence of conservative religious groups. Non-Sunni

Muslims and other religious minorities have been targets of

violence, and some conservative groups have organized

mass demonstrations against non-Muslim politicians.

Indonesia also has a history of violent extremism: several

bombings in Jakarta and Bali targeted Westerners in the

early 2000s, and smaller-scale attacks have occurred

periodically.

Political Background

On February 14, 2024, over 200 million Indonesians voted

in presidential, parliamentary, and local elections—the

world’s largest one-day democratic exercise—and selected

U.S. Engagement with Indonesia

Previous U.S. Administrations have engaged Indonesia

across a wide range of issues, encouraging Indonesians to

deepen their democratic institutions, promote religious

tolerance and the rule of law, develop a more liberal trade

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U.S.-Indonesia Relations

and investment climate, combat terrorism, and engage on

international issues such as maritime security and climate

change. In 2023, the United States and Indonesia upgraded

their bilateral “Strategic Partnership” to a “Comprehensive

Strategic Partnership,” continuing minister-level dialogues

intended to address maritime cooperation, defense

cooperation, economic growth and development, energy

cooperation, cooperation on global and regional issues, and

people-to-people ties. Most U.S. assistance has supported

health, environmental, and educational initiatives, although

the status of individual programs is uncertain given the

Trump Administration’s cuts to foreign assistance.

Indonesia is part of the Indo-Pacific Maritime Security

Initiative, which aims to strengthen Naval and Coast Guard

capabilities in the Indo-Pacific. In 2022, the two countries

finalized several agreements, including a $698 million

MCC Compact supporting climate-conscious infrastructure

development.

Security Cooperation

U.S.-Indonesia security cooperation has deepened over the

past decade, with the two militaries conducting around 170

annual engagements, including on maritime security

cooperation and combatting terrorism. The largest U.S.Indonesia military exercise is the annual Super Garuda

Shield, hosted by Indonesia, which included over 6,000

troops from 13 nations in 2025.

This represents a sharp change from the late 1990s and

early 2000s, when U.S. policies enacted in response to

earlier human rights abuses by Indonesian forces severely

limited bilateral engagements. In 1999, Congress suspended

all International Military Education and Training (IMET)

programs with Indonesia after its military, particularly the

Kopassus special forces—headed at the time by Prabowo—

and militia proxies killed over 1,000 people in Timor-Leste

following Timor’s vote to pursue independence from

Indonesia. Programs were restarted on a limited basis in

2002 and, from 2005 to 2010, the United States largely

normalized military relations.

Indonesia is increasingly involved in South China Sea

tensions. Indonesian authorities periodically confront or

warn off PRC fishing and law-enforcement vessels seen as

encroaching on Indonesian waters. PRC coast guard vessels

reportedly have harassed Indonesian energy exploration

vessels in the South China Sea more frequently and have

accompanied fleets of PRC fishing vessels into Indonesia’s

exclusive economic zone (EEZ). In April 2025, Prabowo

broke from long-standing Indonesian policy by proposing

joint development projects with the PRC in disputed areas.

Economic Issues

Over the past two decades, Indonesia’s economy has

frequently posted growth of more than 5%-6% annually,

buoyed in part by favorable demographics (66% of its

population is of working age). The country is a large

producer of natural gas and oil, as well as critical minerals

including nickel. It is a major supplier of natural resources

to Japan, South Korea, and China, and is the world’s

leading exporter of palm oil.

Indonesia is the 24th-largest U.S. trading partner, ranking

below neighbors such as Singapore, Vietnam, Malaysia,

and Thailand. In 2025, bilateral goods trade totaled $45.8

billion and the bilateral goods trade deficit was $23.7

billion. Indonesia has imposed some policies criticized by

foreign investors, including foreign ownership restrictions

and local content requirements in some industries. In

February 2026, the United States and Indonesia signed an

Agreement on Reciprocal Trade, under which Indonesia

eliminated tariffs on nearly all imports from the United

States and agreed to remove some nontariff barriers, and the

United States cut tariff rates on Indonesian goods to 19%.

Militancy and Terrorism

Indonesia has had a long-running issue of domestic

militancy, including religious and separatist movements. In

2018, Indonesia amended its 2003 Anti-Terrorism Law,

lengthening periods for which suspects can be detained

without charge and broadening police rights to prosecute

those who join or recruit for militant groups. U.S.-Indonesia

counterterrorism cooperation is close; the United States and

Australia helped to create Indonesia’s elite counterterrorism

unit, Densus-88, which has weakened militant groups such

as Jemaah Islamiyah (JI), an Al Qaeda affiliate responsible

for several bombings in the 2000s. The threat of terrorism

in Indonesia remains present but many analysts argue that is

has been diminished in the past decade.

Human Rights Issues

Most observers say Indonesia’s human rights protections

have improved over the past 20 years, as the country’s

democratic system has developed and a relatively robust

civil society, including an active press, has flourished.

Abuses still occur, including some by members of the

military. Alleged abuses are particularly frequent in areas

with simmering secessionist movements such as Papua.

Islamist organizations have harassed and attacked minority

religious groups, including Christians and other Islamic

sects, such as the Shia and Ahmadiyya. In 2016, large

demonstrations by Islamist groups opposed to Jakarta’s

Christian governor raised concerns for many about religious

intolerance. The State Department’s 2025 Trafficking in

Persons report listed Indonesia as a Tier 2 nation and

reported it “does not fully meet the minimum standards for

the elimination of trafficking but is making significant

efforts to do so.”

Environmental Issues

The United States has conducted numerous environmental

and clean-energy programs in Indonesia, which is among

the world’s most biodiverse countries. In 2022, the United

States, Japan, and Indonesia announced a Just Energy

Transition Partnership (JETP), aimed at accelerating private

investment in sustainable energy. In March 2025, however,

the Trump Administration withdrew U.S. participation in

the partnership. Indonesia has made some progress on

issues such as deforestation, but its record of environmental

protection is constrained by weak rule of law and poor land

management. Because of deforestation, Indonesia is a major

emitter of greenhouse gases—the world’s third- or fourthlargest when emissions from deforestation are considered.

Illegal logging remains rampant. In the 1960s, forests

covered 82% of Indonesia; today, they cover 49%. Analysts

also cite overfishing as a concern.

Ben Dolven, Specialist in Asian Affairs

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U.S.-Indonesia Relations

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