Prabowo Subianto
Launched mandatory B50 biodiesel on July 9, signed 18 MoUs with Modi and 26 pacts with Singapore's Wong in early July, and hosted Lukashenko for a 2030 roadmap — while the rupiah sits near record lows and MSCI threatens frontier-market reclassification.
Prabowo Subianto launched the world's first mandatory B50 biodiesel program on July 9, raising required palm-oil content in diesel from 40 to 50 percent and framing it as energy sovereignty — a move to eliminate 3 to 4 million kiloliters of annual diesel imports and save roughly 170 trillion rupiah in foreign exchange by end-2026. The launch capped a week of dense diplomacy: a three-day state visit by Indian Prime Minister Narendra Modi yielding 18 MoUs covering BrahMos and Astra missile acquisitions, critical-minerals cooperation from mining to magnet production, UPI payment linkage, and digital voting machines for Indonesia's 2029 elections; a Leaders' Retreat with Singapore PM Lawrence Wong producing 26 agreements including cross-border electricity projects totaling 3.4 gigawatts by 2035 and a joint pledge to keep the Strait of Malacca toll-free; and a visit from Belarusian President Lukashenko launching a cooperation roadmap through 2030 on agriculture, pharmaceuticals, and technology.
The diplomatic offensive runs parallel to a deepening economic crisis at home. The rupiah hit record lows near 18,200 to the dollar, the Jakarta Composite Index is down roughly 29 percent in 2026, and MSCI downgraded Indonesia's information-flow criterion to negative in mid-June, threatening frontier-market reclassification and up to $13 billion in capital outflows. Bank Indonesia raised rates three times in four weeks to 5.75 percent. The government raised non-subsidized fuel prices 32 percent and cut the free-meals budget from $20 billion to $15 billion with expansion halted. The sovereign wealth fund Danantara raised $1.5 billion in a debut dollar bond in June and is set to become sole exporter of coal, palm oil, and ferroalloys from September — a centralization that deepens investor unease.
Prabowo has responded to corruption in his own ranks by firing and ordering the arrest of his handpicked free-meals agency head for procurement fraud and dismissing a deputy minister after a KPK extortion arrest. Five deaths during military-style training for his village cooperatives program forced the Defence Ministry to strip combat drills from the curriculum, drawing demands from rights bodies for full termination. He frames the entire agenda — commodity-export centralization, downstream industrialization, free meals, cooperatives — as a constitutional mandate under Article 33, warning of resistance from groups that favor corruption and smuggling.
On their plate
Prabowo launched the world's first mandatory B50 biodiesel program on July 9, raising required palm-oil content in diesel from 40% to 50%. The program aims to end 3-4 million kiloliters of annual diesel imports and save roughly Rp170T in forex by end-2026. He framed it as energy sovereignty, the latest step in a broader interventionist economic agenda.
In early July, Prabowo hosted Modi for a three-day state visit producing 18 MoUs (BrahMos and Astra missiles, critical minerals, UPI linkage, digital voting machines), Singapore PM Wong for 26 agreements (cross-border electricity, carbon credits, Malacca Strait pledge), and Lukashenko for a cooperation roadmap through 2030. The spree locks in defense, energy, and trade ties across a non-aligned arc from New Delhi to Minsk.
The rupiah hit record lows near 18,200/dollar and the JCI is down roughly 29% in 2026, the worst-performing major market globally. MSCI downgraded Indonesia's information-flow criterion to negative in mid-June, raising the prospect of frontier-market reclassification and up to $13B in outflows. Bank Indonesia raised rates three times in four weeks to 5.75%; the government cut fuel subsidies and the free-meals budget.
Prabowo fired and ordered the arrest of Dadan Hindayana, his handpicked free-meals agency head, for procurement corruption, and dismissed Deputy Minister Silmy Karim after KPK arrested him for a Rp145.5B extortion scheme. He pledged no exceptions and ordered a broader probe, saying he did not want the people's money stolen — testing his government's oversight credibility.
Five participants died during military-style training for Prabowo's flagship Red and White Cooperatives program (target: 80,000 village coops, 8% growth by 2029) in late June. The Defence Ministry stripped shooting and combat drills from the curriculum, but Komnas HAM and civil-society groups demanded full termination, calling the military discipline a dangerous blurring of civilian-military lines. Thousands of students protested in June over the broader economic management.
Key relationships
Prabowo hosted Modi for a three-day state visit (July 6-8), signing 18 MoUs spanning defense, critical minerals, digital payments, and electoral technology, and conferring Indonesia's highest civilian honor on him.
Energy Minister Bahlil is Prabowo's point man on both the B50 biodiesel rollout and the Singapore cross-border electricity deal, executing the president's energy-export and fuel-mandate agenda.
Prabowo hosted Wong for the Singapore-Indonesia Leaders' Retreat on July 6, signing 26 agreements including cross-border electricity projects and a joint pledge to keep the Strait of Malacca free for all passage.
Prabowo fired his handpicked free-meals agency head for procurement corruption and ordered his arrest, saying he was saddened because these were people he trusted.
Prabowo dismissed Deputy Minister for Immigration Silmy Karim after KPK arrested him for a Rp145.5B extortion scheme, moving against his own appointee.
Prabowo publicly ordered his Finance Minister to replace customs leadership and end illegal levies during his May 20 parliament address — a direct, on-record rebuke of her ministry's performance.
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