AGP Executive Report

India-Indonesia Strategic Push: PM Narendra Modi’s three-day Jakarta visit with President Prabowo wrapped up with a defence-and-digital sprint: Indonesia agreed to buy India’s BrahMos supersonic cruise missiles and Astra air-to-air missiles, while leaders also moved toward linking UPI with Indonesia’s payment system via cross-border QR. Cultural Diplomacy at Prambanan: Modi and Prabowo inaugurated and backed restoration of the UNESCO-listed Prambanan Temple, with Modi promising completion before 2029 and both leaders framing Ramayana reliefs as a bridge for ties beyond politics. Market & Governance Signals: S&P Dow Jones warned Indonesia could face a downgrade to frontier status over market transparency, echoing MSCI’s review and prompting renewed regulatory focus on disclosure and liquidity. Energy Security Under Pressure: PLN told parliament it secured extra coal shipments for Java after rolling blackouts, including higher-grade deliveries and retrofits to burn lower-grade coal. Waste-to-Energy Rollout: Danantara broke ground on Bali’s first waste-to-energy plant, with plans to expand the model nationwide beyond Bali. AI Governance & Child Safety: Indonesia urged people-centered global AI standards at a UN forum, highlighting child protection rules and pushing for flexible standards that don’t burden MSMEs. Trade Diversification: Indonesia’s Trade Ministry said it will shift from primary commodities toward higher-value exports and digital services, while also outlining strategies to expand market access and competitiveness.

India–Indonesia “Golden Chapter” Diplomacy: President Prabowo Subianto told PM Narendra Modi, “I follow your career, copy your programmes,” as Modi received Indonesia’s top civilian honour, the Bintang Adipurna, in Jakarta—framing ties as civilisational and strategic. Defence & Maritime Deals: Jakarta and New Delhi signed agreements for BrahMos supersonic cruise missiles and Astra air-to-air missiles, plus broader defence, coast-guard and maritime security cooperation for a rules-based Indo-Pacific. Critical Minerals, Digital Payments & Elections Tech: The visit also produced pacts on critical minerals and steel supply chains, and moves to link India’s UPI with Indonesia’s payment systems; an election-management MoU targets cooperation on EVMs. Education & Heritage: India’s IIM Bangalore will open an overseas campus in East Java, while India agreed to support Prambanan Temple restoration. Global Policy & Rights: Indonesia joined a UN-backed coalition on children’s rights in the age of AI. Environment: Indonesia’s mangrove “ecological repentance” push highlights degraded coastal ecosystems and resilience planning.

Indonesia–India “Golden Chapter” Diplomacy: PM Narendra Modi’s Jakarta visit with President Prabowo Subianto delivered a packed set of outcomes, including Indonesia’s top civilian honour for Modi (Bintang Adipurna) and a push to deepen defence, maritime security, trade, tech, health and education. Digital Payments & Public Tech: Modi announced India’s UPI will integrate with Indonesia’s payment system, with cross-border QR linkages to follow—plus cooperation on digital public infrastructure like ONDC-based networks. Defence & Maritime Security: Talks centred on major missile cooperation, including BrahMos and air-to-air missile collaboration, alongside coast-guard work for maritime safety in the Indian Ocean. Education & Cultural Diplomacy: India will open an IIM Bangalore overseas campus in East Java, while both sides agreed to restore Prambanan Temple and mark a Tagore–Dewantara cultural year. Election Tech Cooperation: Indonesia and India also moved to collaborate on election technology and EVMs, framing it as a credibility and integrity boost for voting systems. Local Governance Spotlight: Jakarta’s Kampung Bayam eviction story highlights how urban development decisions can erase livelihoods and housing security for long-time residents.

Indo-Pacific Diplomacy: India’s PM Narendra Modi arrived in Jakarta to kick off a July 6-11 three-nation tour, with talks expected to deepen the India-Indonesia comprehensive strategic partnership across defence and maritime cooperation, critical minerals, food security, and the digital economy. Green Finance & Carbon Policy: Indonesia launched its Forestry Carbon Centre and pushed its Carbon Economic Value (NEK) plan, targeting up to US$5.8 billion in green investment and a projected 570 million tonnes CO2e emissions cut, with the Carbon Unit Registration System (SERUK) set for July 9. Digital Economy & Connectivity: Indonesia and Singapore agreed to broaden cooperation through the Leaders’ Retreat, covering trade, energy, digital economy, cybersecurity, supply chains, and cross-border electricity, plus stronger connectivity and tourism links. Regional Trade Realignment: Indonesia signaled closer economic ties with Russia after an EAEU-linked currency settlement push, while Russia-India trade is projected to hit US$70 billion in 2026. Human Rights Watch: Komnas HAM reported a rise in alleged rights violations in 2025, with police, corporations, and regional governments among the most frequently cited actors. Public Health & Environment: A new invasive threat is emerging in Laguna’s Lake Sampaloc as Flowerhorn cichlids spread from the aquarium trade, raising risks to biodiversity and aquaculture.

Indonesia–Singapore Maritime Security: President Prabowo and PM Lawrence Wong pledged to keep the Strait of Malacca “open, safe and accessible,” stressing freedom of navigation as regional shipping faces new pressure. Indonesia–Singapore Energy Deal: Prabowo assigned sovereign wealth fund Danantara to implement the cross-border electricity trade with Singapore, targeting at least 3.4 GW by 2035. PM Modi’s Jakarta Arrival: Narendra Modi landed in Indonesia to kick off a three-nation tour, with fighter-jet escort and a reception by President Prabowo, aiming to deepen the Comprehensive Strategic Partnership and Indo-Pacific cooperation. Act East & MAHASAGAR: Modi framed the visit around India’s MAHASAGAR security-and-growth vision, plus trade, defence, maritime ties, and engagement with the Indian diaspora. Defence Procurement Shift: Indonesia scrapped KF-21 co-production plans, moving toward buying stock warplanes instead. Waste & Environment Policy: Indonesia targets ending open dumping by 2028, with waste-to-energy incineration in Bali and regulatory revisions to speed implementation. Carbon Trading Expansion: Forestry Minister Raja Juli Antoni expanded carbon trading to include social forestry and conservation areas, with a carbon unit system set to launch July 9. Digital Governance: Indonesia launched an ONDC-based open digital commerce network, boosting India–Indonesia digital cooperation. Public Safety & Immigration: Indonesia deported 92 Chinese suspected scammers and issued lifetime entry bans in an anti-scam crackdown.

Papua Security: Indonesian authorities recovered the body of an American pilot killed by separatists in West Papua, after rebels allegedly shot him and burned a civilian aircraft following a landing in Yahukimo—raising pressure on Jakarta to tighten security and clarify what happened. Indo-Pacific Defence Diplomacy: Ahead of PM Modi’s July 6–11 tour starting in Indonesia, reports say Jakarta is looking at phased BrahMos cruise missile procurement and related support, signaling a push for more diversified defence supply lines. Regional Military Industry: Turkey is using the NATO summit in Ankara to market drones and air-defense systems, with analysts saying Trump’s visit may help unlock F110 engine supply for Turkey’s KAAN fighter, though the F-35 dispute remains unresolved. Anti-Drug Cooperation: India will host BRICS Heads of Anti-Drug Agencies in Guwahati on July 6–7, focusing on synthetic drugs, darknet trafficking, precursor diversion, and intelligence sharing. Aviation Links: Oman’s SalamAir launched its first direct Muscat–Medan route, aiming to boost tourism and Umrah travel. Local Governance & Heritage: Malaysia’s tourism ministry approved RM400,000 to upgrade a traditional gasing court in Kampung Pengkalan Renggam, tying heritage sports to future events and training.

Singapore-Indonesia Diplomacy: Prime Minister Lawrence Wong heads to Jakarta on July 6 for the annual leaders’ retreat with President Prabowo Subianto, with talks expected to cover bilateral projects and regional/global issues. Health Worker Protection: Indonesia is drafting a Presidential Regulation to protect medical and healthcare workers after the death of Dr. Eliza Priscila Utami Pakaenoni, citing intimidation, treatment procedures, and weak coordination. Digital Governance & Fraud: Indonesia’s biometric SIM registration is rolling out for new subscribers, with operators backing the goal but asking for lower facial verification fees. Climate & Disaster Preparedness: The government warns regions to prepare for landfill fires as El Niño intensifies dry conditions, after the Jatiwaringin landfill blaze in Tangerang triggered health impacts. Food Security in Papua: Bulog says South Papua’s biggest food development area totals about 102,000 hectares, supported by mechanization and post-harvest infrastructure. Energy & Industry: Indonesia targets 100 Mbps average internet speed and pushes downstream nickel via a $350m battery precursor cathode plant investment. Tax Policy for MSMEs: Officials confirm income tax incentives for MSMEs remain, with turnover up to Rp500m still exempt.

Papua Security: An American pilot, Nicholas F. Gosselin, was shot dead after landing in remote Highland Papua on July 2, and troops recovered his body as the aircraft was set on fire by a rebel group. Online Gambling Crackdown: Indonesia’s Communication and Digital Ministry and Meta formed a joint team to tackle gambling spam comments, with officials saying bot-driven comment flooding is driving a sharp surge in complaints. Urban Health & Environment: Jakarta launched an Air Quality Early Warning System (EWS) with forecasts up to three days ahead to help residents plan around pollution spikes. El Niño Preparedness: The government warned local administrations to step up landfill fire readiness as El Niño-linked extreme weather raises risks after a long-burning blaze in Tangerang. Trade & Finance: Economists at BRI warned Indonesia’s first monthly trade deficit since 2020 could pressure the rupiah and increase demand for FX hedging, with growing concentration in China-linked trade. Health Innovation: Indonesia aims to become an Asia-Pacific ATMP hub by expanding stem-cell and other advanced therapies under stricter GMP-style regulatory readiness. Diplomacy Ahead of Modi: India’s envoy said BrahMos missile discussions with Indonesia are at an advanced stage, with possible defence equipment movement during PM Modi’s upcoming visit.

Indo-Pacific Diplomacy: India’s PM Narendra Modi will kick off a six-day three-nation tour next week, visiting Indonesia first, then Australia (July 8–10) and New Zealand (ending July 11), with talks expected to cover defence, trade, critical minerals and student mobility. Security in Papua: The TNI says it will boost security deployments in vulnerable Papua areas after the killing of an AMA Airways pilot, with officials citing gaps where no security posts exist near remote air routes. Drug Enforcement: Indonesia’s National Narcotics Agency and Russia’s internal affairs ministry agreed to deepen 2026–2027 cross-border drug eradication cooperation, targeting hot spots like Bali and expanding intelligence and digital forensics. Governance & Transparency: A researcher urged Indonesia’s sovereign wealth fund Danantara to publish consolidated financial reports on time, warning that disclosure must be timely to build public trust. Public Integrity Probe: Indonesia says the law will be enforced impartially in the Free Nutritious Meal (MBG) corruption case, including allegations involving active military and police officers. Climate Preparedness: Indonesia is tightening animal disease control ahead of El Niño, while officials also push broader drought and water resilience measures. International Justice: The Philippines says its clemency appeal for Mary Jane Veloso will be relayed to President Ferdinand Marcos Jr., after her return from Indonesia.

Papua Security: Indonesia’s military recovered the body of a US pilot killed by separatists, as the group claimed responsibility and “sent a message” to the US—raising fears of renewed violence in West Papua. Sharia Enforcement: In Aceh, an unmarried couple was publicly caned after a TikTok livestream kiss, reigniting debate over provincial Sharia law and online morality enforcement. Fertilizer Distribution: Indonesia reported 48.5% of its subsidized fertilizer quota delivered (4.77m tonnes of 9.84m) and pledged tighter coordination and price controls ahead of planting. El Niño Preparedness: BNPB warned that anomalous rain can still hit parts of Indonesia despite the dry season, citing global atmospheric dynamics—while the government pushes feed banks and drought response. Indo-Pacific Diplomacy: Prime Minister Narendra Modi’s six-day tour to Indonesia, Australia and New Zealand (starting July 6) is set to focus on critical minerals, trade, defence, and diaspora outreach, with mobility and student visa delays also on the agenda. Digital Infrastructure: Telecom firms completed testing for the MIC-3 subsea cable linking Singapore and Batam, aimed at boosting regional connectivity for AI and data centres. EU-Indonesia Ties: EU and Indonesia said they’re managing geopolitical and policy differences pragmatically while deepening cooperation under the expanding partnership.

Papua Security: Indonesian forces recovered the body of US pilot Nicholas F. Goselin after separatists shot him dead and set his aircraft on fire in Highland Papua; the TPNPB framed it as a “message” over alleged violations and conflict “root causes,” while authorities say passengers were unharmed and security was tightened. Human Rights & Governance: Lawmakers began deliberating Indonesia’s Cybersecurity and Cyber Resilience Bill, with rights groups warning vague provisions could affect privacy and free expression. Rural Politics: The government is scaling back “military-style” training in the Red and White village co-operative program after five deaths, despite the scheme’s push to create 80,000 co-ops nationwide. Economy & Food Policy: Free meal program relief is ending after the school holiday, while Indonesia eyes exporting 10,000 tonnes of rice to Singapore to absorb surpluses—success depends on supply, quality, and competitiveness. International Trade: Indonesia-EU CEPA moves toward EU Council approval, with ratification targeted for late 2026 and early 2027 implementation. Disaster Risk: Mount Lewotobi Laki-Laki erupted on Flores, prompting a local airport closure and lahar warnings; Anak Krakatau also raised to Level III.

Strait of Hormuz Diplomacy: Oman’s Sultan Haitham told UK PM Keir Starmer that toll-free passage and freedom of navigation should be restored, as European officials probe how prewar transit rules could return. Education Digital Push: Indonesia will install 800,000 interactive flat panels in schools this year and train teachers to use them. Energy Access Plan: The government outlined three routes to reach near-universal electrification by 2029: extending PLN grids, building renewable mini-grids, and deploying solar home systems with batteries. Defense Industry Step-Up: PT PAL Indonesia began steel-cutting for two Scorpène submarines with France, two months ahead, after qualification and engineer training. Papua Security Crisis: Separatist rebels claimed they killed a US pilot and torched a plane in Yahukimo; authorities are verifying the fate of seven passengers. Aceh Sharia Enforcement: An unmarried couple was publicly caned after a TikTok livestream kiss, with human rights groups condemning the punishment. E-commerce Tax Collection: Finance will expand marketplace income-tax collectors under Article 22, starting Aug. 1, with a 0.5% withholding for qualifying merchants. Indonesia-Belarus Roadmap: Prabowo and Lukashenko launched a 2026-2030 cooperation roadmap covering energy, food security, trade, and technology. Telecom Infrastructure Deal: Indosat completed a $650m fibre carve-out into an open-access wholesale platform backed by Arsari Group.

Papua Security: A Papua separatist group claimed it shot dead an American pilot who transported Indonesian troops, warning it will target other civilian flights in its “operational zones,” though the allegation was not independently verified. Judicial Independence: Indonesia’s government said it has not discussed any presidential amnesty for former Education Minister Nadiem Makarim after his 10-year prison sentence, stressing the case is still in the appeals process. Energy Policy: Pertamina said it is ready to distribute B50 biodiesel ahead of Prabowo’s early-July 2026 launch, with a transition period allowing B40 stock drawdowns until late September. Foreign Trade & Diplomacy: Prabowo and Belarus President Lukashenko launched a 2026–2030 roadmap and pushed ratification of the Indonesia–Eurasian Economic Union FTA, with a business forum figure cited around US$500 million. Regional Connectivity: SalamAir will start direct Muscat–Medan flights twice weekly, while West Kalimantan is seeking direct Pontianak–China services to boost tourism and exports. Public Order & Morality Law: In Aceh, a couple was publicly caned 21 times each after a Sharia court conviction over a TikTok livestream kiss. Finance & Governance: Jakarta plans Rp 3.5 trillion in municipal bonds to offset central transfer cuts and ease fiscal pressure. Halal Trade: Indonesia’s deposit insurance body urged ASEAN to adopt mutual recognition for halal certification to cut costly re-certification barriers.

Graft Verdict in Focus: Indonesia’s former education minister and Gojek co-founder Nadiem Makarim was sentenced to 10 years over the Chromebook procurement case, with judges citing abuse of authority and state losses, while Makarim says he will appeal. Energy Policy: The 50% biodiesel (B50) mandate kicked in July 1, with a transition for retailers to clear B40 stock as fuel specs and supply allocations remain a key question. Monetary & Markets: Bank Indonesia reported about $9bn in foreign portfolio inflows this year after rate hikes, aiming to support the rupiah while expanding liquidity. Public Safety Scrutiny: A toddler’s death after falling into a construction pit in South Jakarta has reignited debate over infrastructure safety planning and risk management. Transport & Regional Growth: Bandung’s Husein Sastranegara airport is set to resume scheduled jet service on Sept. 17 after upgrades, while Whoosh rail brought nearly 70,000 foreign visitors to West Java in Jan–May. Diplomacy & Appointments: Indonesia’s ambassador presented credentials to Egypt’s El-Sisi, and Indonesia’s INA sovereign wealth fund unveiled its “INA 2.0” push to broaden investments and manage a wider portfolio more actively.

Energy Transition & Power Reliability: Indonesia’s recent blackouts in Java and Sumatra have reignited debate over the coal-dependent, centralized grid, with PLN citing constrained coal supplies and analysts warning the system’s structural vulnerabilities. Rural Governance & Security Training: Prabowo’s flagship plan to build 80,000 village cooperatives is under scrutiny after five civil trainees died during military-style drills, raising questions about training design and safety. Anti-Corruption & Tech Procurement: Nadiem Makarim (Gojek co-founder, former education minister) was sentenced to 10 years over the Chromebook procurement graft case, with court findings on abuse of authority and state losses. Digital Tax Collection: Indonesia will start collecting income tax via designated e-commerce platforms from Aug. 1 (Tokopedia, Shopee, Lazada, Blibli), shifting collection to marketplaces at a 0.5% gross turnover rate. Public Safety & Food Security Delivery: Polri targets 1,500 nutrition fulfillment service units for the MBG program by end-2026, detailing kitchen readiness and certification progress. Climate & Land Restoration: The Forestry Ministry will prioritize restoration in 250 critically degraded watersheds over five years and aims for land degradation neutrality across 12.3 million hectares by 2030. Maritime & Industry: PT PAL delivered the Future Landing Dock (LD)-603 warship to the Philippines, underscoring Indonesia’s shipbuilding export push. Trade & Investment Signals: ERIA economist says trade deals can’t shield Chinese investors from Indonesia’s abrupt policy shifts, while BKPM reports FDI resilience in Q1 2026. Environment in Ports: Indonesia is exploring green-port incentives under the NEK carbon scheme, but says it must first finalize an MRV methodology.

Graft Verdict in Focus: Indonesia’s former education minister and Gojek co-founder Nadiem Makarim was sentenced to 10 years in prison for corruption tied to the education ministry’s Chromebook laptop procurement, with a Rp1 billion fine and Rp809.59 billion restitution ordered. State Accountability & Governance: The court found Makarim abused authority in the 2019–2022 procurement and Chrome Device Management licensing, in a case that has already seen other defendants convicted. Public Policy & Social Protection: Indonesia’s government kept the subsidized cooking oil Minyakita price ceiling at Rp15,700 per liter to protect consumers amid higher global palm oil costs. Infrastructure Push: The Transportation Ministry is preparing 39 new airport locations to expand Indonesia’s aviation network and improve connectivity for frontier and outer regions. Digital Safety & Youth: Indonesia’s child online safety enforcement continues to draw regional attention as platforms deactivate millions of under-16 accounts under government curbs. Trade & Agriculture: Belarus asked Indonesia for annual supplies of 14,000 tons of crude palm oil and 120,000 tons of cocoa, with talks also covering farm mechanization cooperation. Defense Industry Linkages: PT PAL and Denmark expanded maritime defense cooperation through technology transfer and shipbuilding collaboration. SOE Consolidation: Danantara initiated the merger of seven state logistics entities to cut overlapping services and lower national logistics costs. AI Ambition: Batam is positioning itself as an AI infrastructure hub, backed by plans for a major Nvidia-linked data centre project.