Indonesia-Iran Foreign Relations

Reaction to June 2009 Iranian Presidential Election:

In June, 2009, the Indonesian Foreign Ministry offered congratulations to Iranian President Mahmoud Ahmadinejad on his re-election.  The Indonesian foreign minister, Teuku Faizasyah, expressed hope that Iran and Indonesia will continue to expand bilateral relations.[1]

Nuclear:

Indonesia abstained from voting at the United Nations to bring the issue of Iran’s nuclear program before the Security Council in 2006, however it did vote in favor of sanctions in 2007.[2] Indonesia again abstained from voting in 2008, this time on UNSCR 1803, saying that it was not convinced that sanctions would change Iranian nuclear policy for the better and that Iran was, in fact, cooperating with the International Atomic Energy Agency.[3] Indonesia has officially endorsed Iran’s right to peaceful nuclear technology, but only under the safeguards of the Non-Proliferation Treaty and the IAEA.[4] In a press conference in April 2007, Indonesian President Susilo Bambang Yudhoyono called Iran’s nuclear program peaceful and the United Nations resolutions against the country illegal.[5]  The Non-Aligned Movement, of which Indonesia and Iran are both members, released a statement from Tehran in July 2008 affirming Iran’s right to peaceful nuclear technology and condemning military action against the country’s nuclear program. Nevertheless, in 2008 Indonesia voted in favor of UNSCR 1835 against Iran.[6]

Indonesian Foreign Minister Marty Natalegawa reaffirmed his country’s support for Iran's right to develop its nuclear program for peaceful purposes, but has also asked the Islamic Republic to uphold its commitment to nuclear non-proliferation. In a February 2010 statement, the foreign minister explained that "commitment to nuclear non-proliferation and the right to obtain nuclear power for peaceful purposes go hand in hand… They are integrated responsibilities and rights, not one at the expense of another.” He also indicated that Indonesia would seek opportunities to bridge the hostilities between Iran and the West given that it has good relations with both camps.[7] Although Indonesia had previously supported certain United Nations resolutions against Iran, the country opposed the widening of sanctions against Tehran in June 2010.  Natalegawa blamed a “shortage of trust between the parties” for failure to resolve the differences between the opposing sides and urged settling of the “issue through dialogue and negotiations.”[8]

Economic Relationship:

Bilateral trade between Indonesia and Iran largely centers on activity in the energy sector, although it has begun expanding to other industries. In a meeting of the D-8 Organization for Economic Cooperation in March 2008, the chairman of Indonesia’s Cooperatives Council, Adi Sasono, and the secretary general of Iran’s Chamber of Cooperatives, Mohammadreza Ramezani, called for an expansion of bilateral trade ties in all fields between their respective countries.[9] According to a May 2010 statement by Iranian Minister of Industries and Mines Ali Akbar Mehrabian, economic cooperation between the two countries is valued at roughly $850 million.

Indonesia and Iran have agreed to cooperate on several joint development projects. Among the most important of these is a $6 billion joint refinery in Indonesia scheduled for completion in 2012. According to Kamalvandi, Iran will provide around 150,000 to 180,000 barrels of oil a day for the refinery, which is about 12-14% of Indonesia’s total consumption. [10]

Apart from energy cooperation, Iran and Indonesia began discussing agricultural trade and other natural resource trade in March 2009.[11]  In May 2009, Indonesian ministers participated in a conference on foreign investment hosted in Tehran.[12] The two countries also signed a memorandum of understanding in August 2009 in which they agreed to cooperate on technical and economic issues relating to housing and urbanization.[13]

In December 2009, Speaker of the Indonesian House of Representatives Marzuki Ali expressed his country’s desire to further engage Iran in utilizing the country’s “invaluable experiences in various scientific fields.”  Ali emphasized that bilateral trade between the two countries has tripled in recent years and said that the figure could increase further through the sharing of scientific discoveries and technologies.[14]

In January 2010, Indonesian exporters and Iranian importers agreed to increase their fish trade, with Indonesia setting a target of 2000 tons of tuna for export to Iran. Director of Foreign Marketing of the Maritime and Fisheries Department Saut P. Hutagalung also announced that “a larger prospect is very open” for further maritime trade between the two countries.[15]

Ali Akbar Mehrabian and Mohammad Suleman Hidayat, respectively the Iranian minister of industries and mines and his Indonesian counterpart, met in May 2010 in Tehran to discuss opportunities for expanded cooperation. Mehrabian noted that although both Indonesia and Iran enjoy high economic potential, “the volume of the two countries' ties does not match these high capabilities and capacities." The Iranian minister further stressed the role of the private sector in developing economic relations. For his part, Hidayat encouraged Iranian investment in Indonesia, citing calls for Iran to construct both a refinery and a chemical fertilizer plant in his country.[16]

[Click here for more information about Indonesia’s business activity with Iran.]

Diplomatic/Military Cooperation:

Iran and Indonesia, two of the most populous Islamic countries, enjoy high-level political relations. In January 2009, Iran's Judiciary Chief Ayatollah Seyed Mahmoud Hashemi Shahroudi met with Indonesia’s parliamentary vice speaker and described Indonesia as "a great potential for the Muslim world."[17] During his visit to Tehran in January 2009, Indonesian President Susilo Banbang Yudhoyono agreed to expand all levels of official cooperation with Iran by signing five memorandums of understanding with Iranian President Ahmadinejad. Ahmadinejad said Yudhoyono’s visit to Iran marked the deepening of political ties between the two countries.[18] Both Iran and Indonesia are members of the Developing 8 (D-8) and the Non-Aligned Movement (NAM).[19] 

In May 2009, a delegation of Iranian journalists met with members of the Indonesian Journalists Association in Jakarta, asking them to help Iran counter what it claims is a distorted image from Western media. The Indonesian board’s chairman, Tarman Azzam, said that Indonesian journalists would be happy to help Iran improve its media image and counter what he claimed was a “Western media bias.”[20]

In November 2009, Indonesian Foreign Minister Marty Natalegawa met with Iranian Ambassador to Jakarta Behrouz Kamalvandi. The two emphasized the importance of boosting political, economic, and cultural relations, with Kemalvandi urging Indonesia to finalize documents that would make official the expansion of Iranian-Indonesia relations.[21]

In April 2010, the secretary of the Iranian Supreme National Security Council, Saeed Jalili, expressed his view that Indonesia and Iran share common positions on vital security issues such as disarmament, non-proliferation, and civilian nuclear activities. Such agreement, the secretary indicated, could be used to strengthen bilateral cooperation on regional and global issues.[22] Later that month, on April 27, an advisor to Ayatollah Ali Khamenei, Ali-Akbar Velayati, arrived in Jakarta for a commemoration of the 60th anniversary of the establishment of Iranian-Indonesian relations. While in the Indonesian capital, Velayati stressed commonality in cultural views and highlighted the need for expansion of bilateral cooperation.[23]

On the negative side, however, is the issue of narcotics smuggling between the two countries. In February 2010, Indonesian authorities detained an Iranian man after he attempted to smuggle $2.1 million worth of methamphetamine into the country. Some 40 Iranians have been detained in Indonesia in previous months for alleged drug-smuggling. [24] The issue has become an increasing concern for Indonesia. According to the country’s anti-drug agency, the past six years have witnessed a 300% increase in smuggling of illicit narcotics with Iran being the primary source.[25] 

[Click here for more information on the Non-Aligned Movement.]