The skies above Singapore turned a bruised grey as a wave of transboundary haze pushed the 24-hour pollutant standard index (PSI) past 220, into very unhealthy territory and marking the city-state’s longest continuous stretch of poor air quality in over a decade.

As the actual smoke choked the horizon, a toxic fog of political rhetoric clouded diplomatic channels between Jakarta and Singapore. The haze should be a shared reckoning over illegal forest burning. But it instead spiraled into a campaign of official hostility from Indonesia, with threats of economic retaliation and attempts to manufacture an external foe.

To understand how bilateral tensions reached this fever pitch, one must return to the root of the crisis: the haze itself. The Singapore government recently raised the prospect of revising the Transboundary Haze Act to give Singaporean authorities greater power to investigate and prosecute firms allegedly engaged in, or linked to, illegal forest and land burning in Indonesia.

Rather than welcoming a partner in the fight against environmental degradation, Jakarta’s reaction was defensive and openly hostile. Commentators and officials initially claimed that Singaporean and Malaysian companies operating on the ground orchestrated much of the burning. Syahganda Nainggolan, Head of the Government Communication Agency, infamously said, “We do not just send smoke; when there is no smoke, we send oxygen.”

To which Malaysian politician Andrew Chen Kah Eng, whose country is also affected by the haze alongside Singapore, responded, “We Malaysians are suffering, yet you are making fun of our health.”

It was messy.

Soon, the rhetoric escalated from defensive posturing to outright attacks. Former Trade Minister Muhammad Lutfi took to Instagram to lambast Singapore, accusing the city-state of profiting from Indonesian businesses that house their headquarters and family offices there, while publicly airing grievances about corporate practices like transfer pricing.

While Lutfi is now just a regular citizen with plausible deniability that his attacks were coordinated with the government, actual ministers in the Prabowo administration then went on to propose actions that escalate the tension between the two countries:

• Coordinating Energy Transition Minister Bahlil Lahadalia threatened to cut off gas exports to Singapore.

• Communications and Digital Minister Meutya Hafid responded to a statement by a Singaporean Non-Elected MP by warning that 80 percent of internet connectivity in Singapore would be disrupted if undersea cables get cut.

• Deputy Hajj and Umrah Minister Dahnil Anzar suggested that Indonesian pilgrims undertaking Umrah travel should deliberately avoid airlines transiting through Singapore.

These responses risk shifting the debate away from the original objective: holding those responsible accountable. Threats to disrupt essential economic and regional connectivity raise broader stakes, potentially imposing costs on businesses and communities far removed from the alleged environmental violations.

Understanding this shift in narrative calls us to look beyond the diplomatic exchanges themselves to the domestic political dynamics shaping the response. There is, after all, a certain political convenience in having a neighbor to blame. Framing Singapore as an adversary offers a ready outlet for public frustration, while drawing away from the uncomfortable reality of governance shortcomings.

Whether deliberate or not, this framing glosses over a contradiction: the primary victims of the haze are not in Singapore or Malaysia; they are Indonesians themselves. Citizens of Sumatra and Kalimantan bear the brunt of the toxic air, breathing smoke from fires set on their own soil. By picking a fight with Singapore over accountability, Indonesia risks losing sight of its own people whose health and livelihoods are compromised every single year. Their needs are more urgent and tangible than loud displays of national pride.

The administration’s turn towards confrontation reflects a failure of both strategic thinking and solution-oriented leadership. At a time when Indonesia needs stronger enforcement and cross-border cooperation to hold polluters accountable, it is choosing to escalate a diplomatic dispute. Singapore’s move to hold firms within its jurisdiction gives Indonesia leverage to strengthen enforcement against their local operations.

The two countries could coordinate investigations, share relevant financial and corporate information, and improve cross-border enforcement. This would do far more to advance Indonesia’s interest than threats of retaliation that risk undermining the very collaboration needed to address the problem.

Grievances over transfer pricing and other corporate practices are serious and deserve scrutiny, but Indonesia should address them through rigorous auditing, tax reform, and institutional oversight. Conflating these issues with efforts to prevent illegal land-clearing only muddies the agenda. Indonesia can challenge those questionable corporate practices and defend its economic interests without turning every disagreement into a diplomatic showdown

It is time for Jakarta to de-escalate. Ministers threatening infrastructure and supply chains should step back, lower the temperature, and return to the negotiating table. The smoke hanging over Southeast Asia will not clear through threats of broadband cutoffs or gas embargoes. It will clear only when both countries recognize a common enemy: the corporate actors who treat our shared environment as disposable.

Nationalism should not be measured by how loudly officials protest when another country challenges Indonesia, nor should national dignity be so fragile that every disagreement becomes an affront requiring retaliation. It is time to stop fighting each other and start fighting the fire.

When Morgan Stanley Capital International (MSCI) announced its supposed plan to strip Indonesia of its Emerging Market status — plunging it straight down two tiers into Standalone Market territory — the government reacted with its usual cocktail of scapegoating and wounded national pride. President Prabowo even said in a cabinet meeting: “We keep getting intimidated. MSCI is trying to frighten us, but I told them, ‘Indonesia is not afraid of anyone!’”

Back in January of this year, MSCI put Indonesia on notice, citing glaring structural failures: opaque shareholding structures (no thanks to Indonesia’s weak beneficial ownership regime) and questionable free-float figures that have made Indonesian stocks prone to coordinated market manipulation (colloquially known in Indonesian as “goreng saham,” or stock-frying).

We wrote about it here:

But in case this is all news to you, here’s a quick recap of what has happened with MSCI in the year 2026:

• On 27 January 2026, MSCI froze certain index changes affecting Indonesian stocks and warned of possible reclassification to Frontier Market status.

• On 23 June 2026, MSCI retained Indonesia’s Emerging Market status but reiterated its concerns and demand for sustained improvements.

• On 15 October 2026, MSCI proposed a more severe move: reclassifying Indonesia to Standalone Market status, citing ongoing market dysfunction and inadequate evidence of enforcement.

What’s at stake? Well, Indonesia’s market participants have until 30 April 2027 — about six months from now — to submit their feedback, which MSCI will use to make its final decision by 30 June 2027. Worst-case scenario: Indonesia is downgraded to a Standalone Market and removed from emerging market indices, almost guaranteed to trigger billions of dollars in share sales by index-tracking funds and make it harder to attract foreign investment. If that happens, we’ll look back at the stock market crash today like it was the good ol’ days.

In a flurry of damage control in January, Jakarta had the Indonesia Stock Exchange (BEI) and the Financial Services Authority (OJK) leadership step down, lowered the investor ownership disclosure threshold to 1 percent, and raised free float requirements from 7.5 to 15 percent. Officials breathed a sigh of relief, assuming the bureaucratic sacrifice would appease the ratings arbiters.

But it did not. Earlier this month, MSCI reviewed the landscape and delivered the hammer blow: Indonesia had done far less than enough.

The gov’t misunderstands global capital infrastructure

Predictably, the political elite defaulted to deflection. President Prabowo Subianto publicly framed the decision as an act of foreign intimidation, declaring that Indonesia will not be bullied by index providers. Former Trade Minister Muhammad Lutfi, close to the administration, went a step further by trotting out familiar conspiratorial whispers, pointing fingers at Singapore’s sovereign wealth funds, GIC and Temasek, as the ones pulling strings behind the scenes. Both have denied the allegation, though we think they shouldn’t have, since Lutfi offered no evidence to back up his claim.

Suggesting that MSCI is running a geopolitical hit squad against Indonesia exposes how deeply the Indonesian government either fundamentally misunderstands how global capital infrastructure works or denies its own failures. MSCI does not manage money, sell equities, or run sovereign wealth funds by itself. They build benchmark indexes, such as the ubiquitous MSCI Emerging Markets Index, which trillions of dollars in global pension funds, sovereign funds, and passive exchange-traded funds (ETFs) track to the letter.

Passive funds simply do not have the luxury of ideological discretion. When major fund managers such as BlackRock or Vanguard offer ETFs tracking MSCI’s Emerging Market indices, to their clients, they commit to keeping their portfolios closely aligned with those benchmarks. If Indonesia is removed from the indices, those funds would have to rebalance their holdings, creating inevitable pressure to sell regardless of what the Indonesian government says about its more-than-optimistic economic prospects.

Is MSCI right to doubt Indonesia?

Strip away the political theater, the core question remains: are MSCI’s diagnostics correct?

We think so, yes. Unfortunately.

Critics argue that MSCI is being overly harsh, pointing to peer analysis suggesting the two-step downgrade is disproportionate. And there is a legitimate argument to be made there. After all, MSCI is a private institution with power so great that it can almost dictate billions of dollars in investment flows. But even if it is, the government’s protest misses the point entirely. The issues MSCI is concerned about are hardly imaginary. Many — including perhaps some of The Reformist readers here — may be among the domestic retail investors who have complained about the same problems for years.

As the saying goes, two things can be right and contradict each other all at once.

Would it be against Indonesia’s national interest to eradicate coordinated stock manipulation? Obviously not. Protecting ordinary citizens from pump-and-dump schemes run by well-connected syndicates is a duty of a functioning regulator.

Would it be a blow to our sovereignty if the ultimate beneficial owners of publicly listed corporations were transparently disclosed to the public? Of course not. Knowing who actually controls a listed company helps regulators track money laundering, prevents conflict-of-interest abuses, and brings integrity to corporate governance.

Last week, OJK announced a 2.1-trillion rupiah fine against parties involved in violations related to three popular stocks — $DSSA, $BREN, and $CUAN — after uncovering systematic share-price manipulation and concealed identities in share allocation, including parties affiliated with controlling stakeholders.

Should we accuse OJK of being part of the foreign intimidation, too, then? We guess not.

Stop confusing criticism with attack

This chain of events with MSCI raises an inconvenient question: who actually benefits from keeping Indonesia’s stock market opaque? Haven’t we known all along that concentrated ownership and weak enforcement create opportunities for powerful insiders to profit at the expense of ordinary investors who wish to strike luck after setting aside what is left of their abysmal minimum-wage salaries?

These, unfortunately, are not technical problems that we can solve by issuing new rules or making announcements only. What are market regulators for if they can’t hold the participants accountable?

Indonesia’s national interest is not measured by how loudly the government defends a stock market that even OJK has struggled to regulate. The fact that reform is on the horizon only after MSCI makes these tough bargains suggests it is unfortunately necessary. What’s keeping the government from pulling the rug on these ‘bad’ investors and owners all this time when MSCI wasn’t breathing down their neck?

Right?

The possible demotion to Standalone Markets status should serve as a long-overdue reckoning. Sacking regulators and tweaking disclosure percentages while leaving the underlying mechanics of market manipulation untouched was always going to fail. Global capital does not respond to political posturing. It responds to rule of law, clarity, and trust.

Instead of retreating into defensive nationalism and manufacturing conspiracies about foreign hostility, the government should heed the critique’s substance. The path back to international credibility lies not in railing against the mirror, but in reforming how our markets operate.

Good luck to all of us.

The sky appears crimson orange in dystopian-like viral videos as fires continue to rage across the forests and peatlands of Kalimantan, Sumatra, and Papua. People have been living under a suffocating blanket of haze there for over three months, many suffering from acute respiratory infections as the air gets increasingly hazardous.

President Prabowo Subianto recently said he is consulting experts on how to tackle the toxic haze, but it may be time to rely on rain as the “final solution.” But the long dry season is not to blame. Experts at the Meteorology, Climatology and Geophysics Agency (BMKG) had sounded the alarm about the severity of the Super El Niño, which would increase the risk of forest fires, since April 2026. Yet the government did little, if anything, to seriously prevent forest and peatland fires, a chronic ecological disaster we have repeatedly failed to manage.

The government’s response has a gap: putting out fires is critical, but it is not the same as managing a disaster at this scale. If they measure a response’s success primarily by the number of personnel deployed, or fires extinguished, they overlook the ordinary people who bear the costs. The government must respond to the crisis in its full scope, including immediate health impacts, economic losses, and longer-term environmental damage.

The question now is: can the government’s response protect people from the consequences of their negligence?

Firefighting alone is not enough

At the central level, the prevailing narrative is that the government has deployed maximum effort and resources to put out the fires. Cabinet Secretary Teddy Indra Wijaya claimed the government has deployed over 60,000 personnel to carry out a “land operation” with an 80 percent success rate in extinguishing new fires. This kind of success claim is paraded around as if the war against forest fires can be measured solely by the number of hectares extinguished.

However, the success of a disaster response cannot be measured solely by the number of fires extinguished. The government may claim to have reached maximum capacity, yet smog continues to blanket cities, poison citizens’ lungs, and disrupt everyday life.

The direct blow is now being borne brutally by the most vulnerable groups. Schools are forced to close in North Sumatera (and neighboring countries like Timor-Leste), robbing children of their fundamental right to a safe, proper education. As of 11 October, over 62,000 infants and toddlers are suffering from chronic coughs and acute respiratory infections, threatening their development. Daily-wage earners, farm laborers, and small vendors lose their livelihoods overnight because stepping outside into hazardous air is an impossible gamble. These are not peripheral consequences of the fires. They are central measures of the disaster’s severity and of the government’s responsibility to respond.

The government must therefore broaden its definition of progress. It must continue extinguishing active fires while protecting people from hazardous air, ensuring essential services continue, helping affected communities recover, and holding responsible parties accountable. These are not competing priorities but complementary responsibilities.

Indonesia already has legal frameworks that support demands for emergency assistance, recovery, and accountability from the government and other responsible actors. The homework now is to translate those frameworks into action while the crisis is still unfolding.

Drawing on an analogy of an airline’s responsibilities when disruption leaves passengers stranded, there are four things the government must do:

1. Provide immediate relief for people throughout the hazardous haze and fire, now

Public health protection must be an immediate part of the emergency response, not a secondary measure after the fires are extinguished.

When flights are canceled, passengers may be entitled to assistance with food, accommodation, and alternative arrangements, depending on the circumstances and applicable rules. In a forest-fire crisis, the state likewise has a responsibility to ensure people are not left to bear the immediate costs of a disaster they cannot control.

Law No. 24/2007 on Disaster Management and Government Regulation No. 22/2008 on Funding and Management of Disaster Relief provide a legal basis for meeting emergency basic needs, including under Article 17 of the latter regulation.

In practical terms, immediate relief requires the government to provide:

• Emergency shelter and evacuation: Safe, smoke-free environments with proper air filtration systems for displaced or vulnerable residents.

• Basic health interventions: Immediate distribution of standardized masks (such as N95 respirators), mobile health clinics, and free medical treatment for haze-related acute respiratory infections.

• Essential supplies: Ensure access to clean drinking water, nutrition, and other essentials for communities stranded by severe smoke and poor visibility.

• Livelihood support: Provide temporary assistance for daily-wage earners, outdoor workers, and others who lose income because hazardous air prevents them from working.

These measures must be guided by timely air-quality information and clear thresholds for action. Residents need to clearly understand the risk level in their area and what precautions to take, while schools, employers, and local authorities need clear guidance on when to suspend or modify activities.

Just as assistance to stranded passengers cannot wait until a flight resumes, emergency relief must reach affected communities while the crisis is unfolding.

2. Use every available resource to contain the fires

The government must be honest about its capacity to contain the fires and mobilize additional resources when needed, just as an airline must find alternatives when it cannot get passengers to their destinations as planned.

The Indonesian government has reported deploying over 60,000 personnel and achieving an 80 percent success rate in extinguishing new fires. While we can acknowledge these efforts, the government should be honest about the scale of the problem and whether its operational capacity matches the crisis’s scale and persistence.

This problem has now caught international attention, reflecting its true scale. Transboundary haze sparked serious debate in neighboring Malaysia’s parliament, with politicians like Syed Saddiq recorded on camera voicing Malaysians’ anguish over haze disrupting their daily lives, urging fellow ASEAN countries to apply diplomatic pressure and treat Indonesia as “an outcast in the region.”

National pride should not prevent the government from using available resources to protect people. Malaysia said it offered assistance, but Indonesia didn’t respond. Japan, meanwhile, deployed three Chinook helicopters to Kalimantan, dropping 220 tonnes of water around Ketapang and Pontianak before concluding its mission. Japan’s Defense Ministry said in a statement that the Indonesian government appreciated its contribution to curbing the fires and added that it could handle further response.

Unfortunately, this isn’t the first time the government has been reluctant to accept assistance from foreign states. During last year’s floods in Sumatra, the central government reportedly only allowed local authorities to receive aid from international entities while restricting assistance from foreign governments. Such distinctions deserve scrutiny when they risk narrowing the resources available to people in need.

Where domestic capacity falls short, the government should coordinate additional resources and accept appropriate assistance from other countries and regional partners. An airline unable to manage a disruption with its existing capacity would be expected to explore workable alternatives. A government responsible for protecting millions of people should be equally willing to use every effective option available.

3. Rebuild livelihoods and restore damaged ecosystems

When a flight is canceled, airlines must not only get passengers through the immediate disruption, but also help them reach their destination. Similarly, for communities affected by forest fires, recovery means restoring livelihoods, addressing losses, and repairing environmental damage.

At this scale, the impact of haze extends far beyond smoke exposure. Daily-wage earners, farm laborers, and small vendors can lose income as hazardous air disrupts work. Farmers suffer crop and land damage. Families bear additional healthcare costs and educational disruptions. These losses can persist long after the fires are extinguished.

The government should assess these losses early and translate them into concrete recovery plans. This includes restoring livelihoods and damaged ecosystems, and ensuring assistance reaches those who cannot afford to wait for conditions to return to normal.

Recovery must also address who ultimately pays. Where evidence establishes that companies are legally responsible for environmental damage, the government should pursue compensation and restoration through available legal mechanisms. Public funds may be needed to provide timely assistance, but the public should not automatically bear the long-term costs of damage caused by these actors.

Government Regulation No. 22/2008 on Funding and Management of Disaster Relief and Law No. 32/2009 on Environmental Protection and Management provide relevant frameworks for disaster recovery and environmental restoration. Yet, pursuing accountability in court can be difficult. Community lawsuits against concession corporations in Ogan Komering Ilir (South Sumatera), for example, faced setbacks over rigid legal standing requirements.

An airline would not fulfill its responsibility by simply providing a meal while leaving passengers stranded indefinitely. Likewise, the government cannot consider its job done once the smoke clears. Recovery must begin while the crisis is unfolding, with clear plans for livelihood support, environmental restoration, and compensation where legally warranted.

4. Address the causes and consequences of preventable harm

When an airline’s failure causes passengers harm, resolving the immediate disruption doesn’t erase its responsibility. Extreme weather can worsen fire conditions, but it doesn’t remove the government’s duty to prepare for foreseeable risks and enforce environmental laws. Government officials and companies must meet their legal obligations.

The government must establish who is responsible, whether agencies acted on available warnings, and what remedies are required. Law No. 32/2009 on Environmental Protection and Management provides avenues for environmental enforcement and legal remedies, subject to applicable requirements.

The government has begun investigating companies suspected of contributing to the fires. But without a transparent process to establish liability, impose appropriate consequences, and ensure restoration or compensation where warranted, these efforts risk becoming performative gestures rather than meaningful enforcement.

Indonesia has precedents for citizens seeking redress. After the 2015 fires and haze, residents of Central Kalimantan successfully sued the government, and the court granted 26 demands, including free healthcare for affected residents. Legal aid organizations (LBH) have led class actions in places like West Kalimantan, demanding that the government, among other things, take firm action against concession holders and restore burned forests and lands.

However, affected communities cannot be left to seek remedies on their own. This administration can take a bolder approach by fulfilling its enforcement responsibilities.

Passengers should not have to navigate a legal maze to obtain remedies for a service failure. Likewise, people affected by forest fires should not be left to bear the losses or fight alone to recover them.

The government must act now and prepare for what comes next

The ongoing crisis is an ecological emergency that tests the government’s ability to protect the public. The government should transparently assess whether the scale of the fires, public-health impacts, and disruption to essential services warrant a national disaster declaration. If the criteria are met, it should declare an emergency and mobilize the necessary resources. Whatever the formal status, immediate relief, recovery support, and effective fire containment cannot wait.

It is perhaps wishful thinking to expect the government to look beyond the immediate crisis and seriously examine why warnings did not translate into adequate prevention. BMKG had flagged heightened fire risks since April. At the very least, the public deserves to know how those warnings informed the government’s preparations, what went wrong, and what will change before the next fire season.

Rain may eventually bring relief. People may step in to help and donate. But neither can substitute for the government’s responsibility to protect its people.

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On 2 October, 26 political figures took an oath in the State Palace to give the president unvarnished counsel as members of the Presidential Advisory Board (‘Wantimpres’). The press predictably focused on spectacles, like political critic Rocky Gerung — famous for his often controversial commentaries on the Joko “Jokowi” Widodo administration — now stepping into the corridors of power he once ridiculed. Sure, Rocky’s appointment makes a striking headline, but the media circus surrounding a single maverick obscured a far more consequential story unfolding in the room:

Why does President Prabowo Subianto need 26 more advisors to tell him how to govern?

Law No. 19/2006 established the Presidential Advisory Board as a deliberately lean body of nine distinguished figures. But a 2024 amendment (Law No. 64/2024) scrapped that limit, and a 2026 Presidential Decree ballooned the structure into a clunky apparatus comprising a chair, a deputy chair, a secretary, and twenty-three members. Even if one interprets this expansion as a well-intentioned attempt to satisfy the constitutional mandate that the president be advised, the advisory does not exist in a vacuum.

President Prabowo Subianto already appointed ten Special Advisors (‘penasihat khusus’) for politics, economy, national security, defense, energy, healthcare, hajj affairs, communications, civic technology, and labor affairs. And then there’s the National Economic Council (‘DEN’) — an eight-member economic advisory council chaired by Luhut Binsar Pandjaitan, who sits on both bodies. If we remove the overlaps and count each individual once, we get 43 prominent figures with formal, state-funded appointments explicitly tasked with advising one person.

Prabowo’s advisory crowd works alongside the largest cabinet in the country’s history: an executive branch of 49 cabinet ministers and more than 50 deputy ministers. Add the Chief of Staff, the Cabinet Secretary, the State Secretary, and dozens of government bodies to this tally, and you get 166 people in the president’s cabinet.

It takes a leap of imagination to believe a specific national policy decision genuinely improves after running through a gauntlet of over 100 ministers, deputies, and advisors. It is even harder to picture the logistical reality of a working meeting where 43 advisors are given the floor to debate complex state affairs.

Then there’s the burden on the public treasury. Presidential Regulation No. 15/2026 fixed each advisory board member’s monthly salary at Rp 76.5 million, paired with ministerial-level facilities such as official vehicles, healthcare, and housing allowances. So it’s roughly Rp 918 million per year per advisor before taxes.

For the Board alone, the basic compensation package approaches Rp 24 billion annually, excluding the substantial operational costs of dedicated secretariats, travel budgets, security details, and office facilities. Under the 2007 regulation, an advisory board member received a monthly stipend of around Rp 17.5 million.

An additional dozens of billion per year for just the Presidential Advisory Board would already be difficult to justify under the best economic circumstances. But this becomes indefensible against the broader policy landscape.

The administration approved the raise after beginning its term with a sweeping austerity decree that ordered cuts to public spending totaling hundreds of trillions of rupiah. Civil servants were instructed to cut down operational expenses, cancel seminars, and conserve office stationery. The government constrained fiscal transfers to local governments and ordered state universities, regional hospitals, and public infrastructure funds to absorb significant cuts. The public was asked to sacrifice for fiscal discipline. Meanwhile, the palace quadrupled the cost of its counsel.

Inherently, advisory councils are not problematic. A president who actively seeks diverse expert perspectives outside his immediate political party is desirable. But when his advisory circle reaches this size, the public has reasonable grounds to ask whether these appointments are meant to produce sound policy or serve as a comfortable landing pad for retired political elites. A quick review of the appointee list — like a former coordinating minister and retired police and military generals — might suggest these positions often serve as political consolations rather than functional think tanks.

If these 43 advisors are to justify their drain on public resources, their work must be subjected to public scrutiny. Taxpayers have a right to know the basic operational metrics of these councils. How frequently do the advisors convene as a collective body? Do these advisors produce concrete, written recommendations, and if so, are those documents accessible to lawmakers in the House of Representatives, journalists, and the public? What measurable policy outputs have they produced during their tenure?

These are not trivial; they are central to executive governance. Major national initiatives under Prabowo’s administration have frequently arrived as abrupt public pronouncements rather than visible output of structured policy deliberation.

We don’t dispute the President’s right to seek counsel. But taxpayer-funded advice should leave a public trail. The Presidential Advisory Board, the Special Advisors, and the National Economic Council should publish regular reports on their meeting agendas, the policy questions referred to them, and executive summaries of the advice they delivered. Strategic intelligence and sensitive national security discussions can remain confidential, but the daily output of state-funded advisory bodies should never be treated as a secret.

The public deserves to know what counsel their President receives and exactly what they pay for.

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Early in 2025, the Constitutional Court annulled the 20 percent presidential threshold requirement in Article 222 of Law No. 7/2017 (Elections Law). Together with an earlier 2023 ruling that mandated the House of Representatives (DPR) to revise the 4 percent parliamentary threshold proportionally for the upcoming 2029 elections, the Court presents a rare opportunity to reimagine Indonesia’s electoral framework, effectively dismantling artificial barriers that guarded national politics for decades.

These rulings must guide the House’s current revision to the Elections Law to reflect proportional representation and constitutional fairness. Yet, Senayan has signaled a parliament scrambling to protect its status quo rather than honoring the spirit of the ruling. Instead of accepting the end of the threshold era, lawmakers are actively floating new, convoluted mechanisms designed to maintain their gatekeeping privileges.

1. Status quo’s defense of the 4 percent parliamentary threshold

For years, the political establishment has defended the 4 percent parliamentary threshold using the “effective governance” argument. The claim relies on the premise that limiting the number of factions in parliament prevents extreme fragmentation; making it easier for legislation to pass. Preventing deadlocks is a valid rationale for a multi-party presidential system like Indonesia’s, but Indonesian presidents have built large coalitions that cover most of the House.

Current President Prabowo Subianto’s KIM Plus coalition covers 81 percent of seats in Senayan. Jokowi’s second-term governing coalition also reached 81.9 percent. These facts suggest that using effective governance as an excuse to impose high barriers to entry only justifies consolidating power among a handful of major parties.

This gatekeeping creates massive democracy costs; over 17 million votes never translate into seats in the 2024 general election. Out of roughly 151 million valid national votes, the 4 percent threshold required a party to secure approximately 6 million votes to enter the legislature.

The United Development Party (PPP) secured 5.87 million votes, or 3.87 percent of the national total. Because they fell a fraction of a percent short, the party was entirely wiped out of the House for the first time in about 50 years. As a result, nearly 6 million citizens cast valid ballots for a party that earned enough votes to win seats in some districts, but still had no representation at the national level.

They weren’t the only ones. The Indonesia Solidarity Party (PSI) also had 5 candidates would have been seated if only the party clear this threshold. This shows a democratic system that intentionally discards the voices of millions of voters. If a candidate wins the majority of votes in their district, they should be able to secure the seat at the parliament. A higher threshold risks losing the essence of proportional representation in an electoral democracy.

After a Constitutional Court ruling highlighted the disenfranchisement caused by the 4 percent threshold, the ruling parties’ response has been spectacularly tone-deaf. Instead of recognizing the need for more proportional barriers, parties like Gerindra and Golkar have floated proposals to raise the threshold to 5 percent. Nasdem has pushed the boundary even further, suggesting a 7 percent threshold. These defy all democratic logic. If a 4 percent erased 17 million votes, a 7 percent threshold would silence many many more citizens..

We think these suggestions have nothing to do with effective governance or legislative efficiency. They are overt attempts by incumbent cartels to shrink the political arena, eliminate smaller challengers, and divide the legislative pie among an ever-shrinking circle of elites.

We do not have to look far to see that democracy functions just as well without these barriers. At the subnational levels, Regional People’s Representative Councils (DPRD) operate entirely without a parliamentary threshold. Parties win seats directly proportional to the votes they gather in their electoral districts. PSI has exactly 1 seat in various local parliaments. No mainstream discourse suggests that local governance is failing because of excessive party fragmentation; at least none that we’re aware of.

If the proportional system works across Indonesia’s regions to capture the diverse political will of local populations, there is no reason it cannot work nationally. The insistence on a national threshold is a manufactured necessity.

2. Inventing a new gatekeeper in a recent presidential threshold maneuver

The Court’s ruling on the presidential threshold being unconstitutional is also at risk of being similarly thwarted by lawmakers desperate to maintain their leverage. With the 20 percent barrier struck down, emerged in recent discussions in the House an entirely new hurdle: requiring a presidential ticket to be backed by a coalition of at least two parliamentary factions.

This requirement blatantly disregards the Court’s mandate. The ruling should be interpreted as a clear directive that parliament cannot arbitrarily add thresholds to limit candidates. If a single party has the confidence, the internal machinery, and the public support to nominate its own candidate, it should not be legally forced into a marriage of convenience.

Forcing a minimum two-faction coalition is purely political maneuvering. It exists to guarantee that the major parties remain indispensable brokers in every presidential race. It forces transactional politics, where policy platforms take a backseat to backroom deals over cabinet seats and resource allocation. By trying to invent new rules to replace the old ones, the parliament is signaling that it views the electorate not as constituents to be represented, but as obstacles to be managed.

The House should choose meaningful democracy

The House of Representatives now faces a choice. Lawmakers can accept the Constitutional Court’s rulings as the foundation for a more mature, representative democracy; or they can keep treating election law as an incumbent protection racket. Interpreting the rulings in good faith means rethinking the arbitrary 4 percent parliamentary barrier, rejecting the proposals for higher thresholds, and stopping the invention of backdoors like the two-faction presidential rule.

It is time to come to a truly open, proportional, and fair electoral framework. If a party wins a district, they deserve a seat. If a party wants to nominate a presidential candidate, they should face the voters, not a coalition gatekeeper. Anything less betrays public trust in our democratic process.

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For months, PT Bayan Resources Tbk (BYAN), the coal miner controlled by billionaire Low Tuck Kwong, could not get the Ministry of Energy and Mineral Resources (ESDM) to approve its revised annual production plan (‘RKAB’) that sets the company’s production quota. With no quota, Bayan had to stop producing and declared force majeure on its overseas delivery contracts.

While conglomerates like BUMI and Adaro may be larger, Bayan’s coal sits closer to the surface, resulting in the lowest overburden removal costs in the industry and exceptionally high profit margins. This makes it highly vulnerable to regulatory holdups and attractive to opportunistic buyers.

Bayan’s controlling shareholders then signed a conditional agreement to sell a large stake to PT Jhonlin Baratama, an entity linked to Andi Samsudin Arsyad, a politically connected businessman, also known as Haji Isam. The reported price was well below market. Within days, ESDM gave Bayan’s subsidiaries up to 20 million tons of additional quota, and the company withdrew its force majeure notice and resumed operations. Notably, the newly minted state investment agency, Danantara, did not absorb this lucrative stake for the public benefit. Instead, it was secured by Haji Isam, who is a principal campaign financier for President Prabowo Subianto—leaving market observers to draw their own conclusions about the ordeal’s true purpose.

An ESDM official told the press that the timing was coincidental and the result of routine administrative processing. But that’s not how the market reads it. As far as they could tell, the quota came through because of political alignment; technical compliance had little to do with it.

South China Morning Post (SCMP) reported that the Bayan case left an “unpalatable aftertaste” for investors, leaving market participants worrying about uncertainty over regulatory decisions and future government interventions.

This isn’t the first state takeover case

Bayan is not the first company to face this issue. A pattern emerges across the archipelago in which the state uses its regulatory power to push operators into distress and then toward targeted asset transfers or state absorption.

The Martabe Gold Mine in South Tapanuli, North Sumatra, is one of the country’s best gold assets. PT Agincourt Resources, a subsidiary of Astra International’s United Tractors, operates it. After severe floods in Sumatra late last year, the government’s Forest Area Regulation Task Force (‘Satgas PKH’) put Agincourt on a list of concessionaires facing immediate permit revocation over alleged environmental compliance failures.

Experts raised concerns about the Satgas PKH’s revocation list, saying the task force can only audit and recommend, but it doesn’t have the authority to revoke a mining company’s permit. Officials with legal authority must make the revocation decision. Meanwhile, Danantara’s Chief Operating Officer, Dony Oskaria, said the Martabe’s mining rights would be given to a newly established state-owned mineral company under Danantara, PT Perminas.

However, due to strong pushback from international investors, the government paused Martabe’s revocation, and the asset now sits under administrative “reassessment.” But while the government paused the revocation of the Martabe mine due to swift pushback from international investors, domestic tycoons have faced the full brunt of the policy. In January, the government abruptly revoked the permits of 28 companies across Sumatra, spanning over one million hectares.

Smaller operators run into their own versions of this. In South Sumatra’s coal corridors and Central Kalimantan’s mineral belts, independent operators have faced sudden holds on haul-road permits, port access, and forest clearing approvals. A recurring pattern emerges where independent operators face sudden, indefinite holds on their approvals, leaving them little choice but to sell equity to well-connected national or regional figures.

The government must be more transparent

This is not to say that large conglomerates or foreign-owned operators deserve protection. Big companies — owned by domestic tycoons or multinational parents — must comply with the law like anyone else. A company that breaks environmental standards, misses its local processing obligations, or avoids taxes should face firm enforcement.

But that enforcement has to come through due process, with transparent legal proceedings and equal treatment under the law. Enforcing a statute is one thing. Holding up permits until an asset lands with a favored buyer is another. If officials can decide on their own who may hold an asset and who must sell, the regulator stops acting as a referee and starts deciding who gets access to the sector.

If the state really wants to reclaim badly managed concessions or earn more from its natural resources, it has to replace this discretionary model with a transparent one.

Why not put all concessions up for auction

An asset should be returned to the public domain when its concession holder loses its operating rights due to a legal or environmental breach. It should go to an open tender and not be reassigned through an opaque administrative process or closed-door negotiation. Bidders at a public auction would compete on clear criteria, such as higher royalties for the treasury, binding guarantees for environmental remediation, and verified technical capability.

Making concession management public would break the rent-seeking cycle, because permits given behind closed doors create a trade that suits both sides. Politicians use regulatory bottlenecks to raise campaign money or win commercial stakes for allies, and companies focus on buying political patronage instead of running their operations better or improving their environmental record.

But it’s the public who pays for this in the long run. When approvals depend on patronage, country risk rises, and foreign investment falls. That raises the cost of capital across the economy. It pushes serious investors — the ones who bring technology, ESG compliance, and long-term capital — elsewhere, leaving the market to short-term rent-seekers.

Restoring institutional credibility means taking arbitrary leverage away from executive agencies and running the extractive sector on open, rule-based governance.

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As Suahasil Nazara takes the helm as the next Finance Minister, the market, local governments, and international observers may not be expecting a grand financial visionary. They want a competent firefighter.

The root of the issue lies in the executive suite itself. The rapid sequence of appointments reveals an administration struggling to reconcile grand political promises with fiscal reality. Sri Mulyani Indrawati was ousted when her institutional discipline stood in the way of massive flagship mandates. Her successor, Purbaya Yudhi Sadewa, acted as the compliant enabler—stamping every political check, shifting targets, and eroding institutional trust to accommodate the Palace’s demands. Now, Suahasil Nazara inherits the wreckage.

Instead of bold speeches promising sweeping structural transformation, Suahasil’s success will depend on fiscal triage. Can he contain these five immediate blazes before they combine into a full-blown crisis—or will he, too, be consumed by the President’s unyielding spending appetite?

1. Revenue shortfall coupled with tax refund backlogs

The most immediate fire to tame is a revenue architecture that is currently bleeding cash. Until August 2026, tax revenue reached just Rp 1,409.1 trillion, a mere 59.8 percent of the annual APBN target. With four months left to collect the remaining 40.2 percent, the shortfall highlights targets set unrealistically high to finance ambitious spending and meet the political goals of the administration.

Compounding the problem is the controversial strategy of withholding tax refunds to artificially bolster revenue figures. As businesses complain of stalled cash flows, analysts warn that holding back refunds could trigger an actual tax shortfall of Rp 80 trillion to Rp 140 trillion. This could directly harm private sector liquidity and job creation.

Amid an economy already struggling, general tax hikes are simply out of the question. Suahasil must perform a tough balancing act: find innovative ways to raise revenue and improve our ever-dwindling tax-to-GDP ratio without further burdening a fragile economy. That means focusing on structural leaks: overhauling administrative collection mechanisms, expediting digital tax integration without technical friction, and setting future revenue targets rooted in economic reality rather than political fantasy.

2. Expensive flagship political programs

The second blaze sits at the intersection of political ambition and basic arithmetic. The Prabowo administration’s flagship social initiatives, most notably the Free Meal Program (MBG) and the Merah Putih Village Cooperatives (KDMP), carry massive price tags and immense political momentum.

While the policy goals are understandable, running them without fiscal discipline threatens to bleed the national budget dry. This is where Suahasil faces his ultimate test.

These presidential flagship programs require strict budgetary guardrails: phased rollouts, aggressive independent auditing, and precise geographic targeting to prevent waste. If a program runs over budget, the ministry must have the authority to pause, recalibrate, or scale back execution. Ideology must not break the bank.

3. Pandemic-era debt maturing amid higher borrowing costs

The third is a dangerous ticking time bomb: a massive “debt wall” reaching maturity. In 2026, government debt maturity hit a peak of Rp 833.96 trillion — the highest point in the current SBN repayment cycle — compounded by Rp 154.5 trillion in maturing central bank burden-sharing bonds from the pandemic era.

Debt service interest alone is projected to swallow Rp 599.44 trillion, consuming more than 22 percent of total tax revenues. When combined with principal repayments, total debt obligations threaten to absorb nearly 45 percent of state revenue. Managing this mountain of debt in a global “higher-for-longer” interest rate environment leaves zero room for error. The challenge lies in executing this massive refinancing drive under the weight of global “higher-for-longer” interest rates. With market volatility elevated, every new bond issuance risks locking Indonesia into elevated borrowing costs for years to come.

Suahasil must execute a deliberate refinancing strategy. That involves careful secondary market management, active debt restructuring, and transparent communication with institutional investors. Restoring credibility is the single effective hedge against paying higher risk premiums. Bondholders need to know that the Ministry of Finance is once again run with steady, predictable discipline, unswayed by executive pressure to take on more expensive debt for short-term spending.

4. Friction between local governments over budget transfer cuts

Outside Jakarta, regional governments have struggled as central government transfers (TKD) have been severely slashed since President Prabowo took office in 2025.

These central funding cuts were effectively used to squeeze regional administrations in order to free up liquidity for top-down, centralized flagship initiatives. Essential local infrastructure halts, public service quality drops, and local administrations risk insolvency.

As the treasury, the Finance Minister cannot just drop the axe and walk away. Suahasil needs to balance central fiscal discipline with targeted regional support. This requires implementing conditional liquidity facilities for distressed municipalities while granting local governments broader, regulated space for local revenue autonomy. Slashing transfers without providing alternative survival mechanisms simply exports central fiscal stress to regional administrators and citizens alike.

5. Blurring of boundaries between the Treasury and the Central Bank

The final blaze to contain originated from a fundamental blurring of institutional boundaries. Under intense pressure to deliver quick wins for the administration, Purbaya’s Finance Ministry blurred the line between fiscal management and monetary intervention, notably by pouring vast sums from the accumulated cash balance (Dana SAL) directly into state-owned Himbara banks under the guise of injecting liquidity.

This was a misdiagnosed medicine for a non-existent illness. State banks were not facing a liquidity shortage; they were constrained by structural credit demand and macroeconomic risk. By treating state cash balances as a pseudo-monetary tool, the Finance Ministry crossed into central bank territory.

Suahasil must retreat from this policy overreach and return the Treasury to pure fiscal fundamentals. Crucially, he must repair working relationships with Bank Indonesia, establishing harmonious, coordinated policy channels rather than attempting unilateral liquidity engineering that unnerves financial markets.

Bringing back institutional trust

Ultimately, one of the most vital tasks awaiting Suahasil is restoring institutional trust. It’s an intangible asset severely damaged over a year of rapid ministerial churn and fiscal appeasement. Fiscal policy relies heavily on credibility, and credibility is built through measured, predictable, and prudent statements and actions.

Suahasil’s legacy will not be carved out by trying to please the Presidential Palace or by endorsing unchecked spending in the name of political harmony. It will depend entirely on whether he chooses to act as an unyielding fiscal anchor — willing to speak with discipline and say no when arithmetic demands it — and whether President Prabowo grants him the structural room to do so.

If the presidency continues to demand validation for an unsustainable agenda, even a third minister will not stop the bleed. The fires are raging, but Suahasil can only put them out if the President allows him to hold the hose.

It’s barely been a month since the devastating earthquake tore through East Nusa Tenggara (NTT), exposing Indonesia’s vulnerable emergency architecture. Yet here we are again, watching the sky painted in choking hues of orange and grey as the country battles forest fires across Sumatra and Kalimantan, while four active volcanoes — Mount Anak Krakatau, Mount Semeru, Mount Ili Lewotolok, and Mount Ibu — erupt and spew ash across Java and Nusa Tenggara.

While volcanic eruptions are natural geological events, forest fires are human-made catastrophes. Extreme weather shifts resulting from the cyclical climate phenomenon El Niño may have catalyzed the spread of these forest fires, but calling them “natural disasters” is lazy and absolves human actors of accountability.

The reality is that people in Kalimantan and Sumatra, even those in Malaysia and Singapore, now breathe hazardous air because the government failed to curb the spread of forest fires despite the crisis being entirely foreseeable.

As early as April, the Meteorology, Climatology, and Geophysics Agency (BMKG) issued a warning that this year’s El Niño would trigger severe dry spells, turning our dense forests and fragile peatlands into tinderboxes. BMKG’s climatologists even correctly predicted that forest fires would spread in Kalimantan around July and August. Yet, despite this research, the government failed to prepare, and the people paid for it.

The contested ‘local wisdom’ provision

The root cause of these fires has remained unchanged since 1997: the persistent, illegal use of fire by plantation companies (and others) for land clearing. Although the government regulates the practice, Article 69 Section 2 of Law No. 32/2009 on Environmental Protection and Management allows exemptions for indigenous communities, limited to two hectares per household and only if done to grow local plant varieties.

As environmental advocates have pointed out for years, massive palm oil and timber corporate entities have allegedly been involved in land clearing by burning that caused the forest fires.

Last month, Kompas overlaid a map of Kalimantan forest fire hotspots on a Kalimantan land concession map. The result shows that over 50 percent of fires happened on concession lands, such as oil palm plantations, mining, and logging.

A provision meant to protect traditional farmers has become a legal blanket enabling widespread environmental destruction. Decades of drainage and deforestation have turned Indonesia’s peatlands (gambut) into dry, underground fuse networks. On dry peat, a controlled fire on a two-hectare plot cannot be contained to its boundary. It seeps beneath the surface, spreading invisibly across miles and igniting uncontrollable blazes.

On 7 September 2026, after the haze spread uncontrollably, the government finally announced a Presidential Instruction prohibiting all forest land burning, including practices rooted in local wisdom.

Once again, the state’s response reveals a troubling pattern: reactive, disjointed, and reliant on last-minute notifications. Those affected by the burning forests had to wait weeks before the president said anything, while fires didn’t stop destroying their lands and haze polluted their air. The multiple volcanic eruptions show a similar pattern. Communities near these volcanic zones received warnings only when ash was already settling on their roofs.

Why are predictive systems, early-warning alerts, and quick disaster response consistently treated as an afterthought?

The oil palm companies… benefit?

However, the most surreal and damning indictment of this entire tragedy lies not on the ground, but on the trading floors of the stock exchange.

When the BP Deepwater Horizon oil spill occurred in 2010, BP’s stock crashed by over 50 percent within weeks. Investors fled because they anticipated the inevitable corporate accountability: aggressive state prosecution, billions in regulatory fines, and massive operational sanctions.

In Indonesia, the market behaves in the opposite way. As fires destroy thousands of hectares and smoke darkens the skies, the stock prices of major palm oil and agribusiness firms do not crash. They surge. Crude palm oil futures near record highs, and market valuations rise as investors anticipate constrained supply and higher commodity prices.

How can a corporate sector facing widespread environmental destruction see its equity rise? Because global and local investors have already priced in government impunity. The market understands a cynical truth: there will be no massive corporate fines, no revoking of major concessions, and no structural consequences.

This moral and institutional failure cannot continue. We cannot claim to be a modern state while relying on reactionary crisis management and outdated legal frameworks.

What the government must do

We call on the government to act decisively: (1) evaluate the land-clearing exemption and its enforcement; (2) hold corporate actors — including their beneficial owners — accountable; and (3) prioritize disaster response preparedness by taking early warnings seriously.

Law enforcement must aggressively target the beneficial owners of land concessions where hotspots emerge. Fines must be set at levels that hit balance sheets hard enough to alter corporate behavior, alongside real civil liability and concession cancellations.

The smoke will eventually clear, as it always does when the monsoon rains arrive. But until the state aligns its laws with ecological reality and proves to the market that environmental destruction carries a ruinous price tag, the fires will return year after year.

On 27 August, demonstrators led by the Aliansi Masyarakat Pati Bersatu, alongside other organizations, took to the streets with a single demand: pass the asset forfeiture bill. The public’s frustration about it is understandable – the bill has been in parliamentary limbo for almost two decades. Its first draft dates back to 2008 and has been on and off each year’s national legislation program (Prolegnas) since then.

At the meeting with protesters, House of Representatives (DPR) Deputy Speaker Sufmi Dasco Ahmad promised the bill would pass by December, even raising the stakes by saying he would resign if it doesn’t.

Is this a cause for celebration?

To regular Indonesians watching an endless parade of high-profile graft trials, the logic behind the bill seems straightforward: if someone steals from the public fund, the state must seize their loot and return it. The people’s ideal punishment for graft offenders is not just temporary incarceration, but also total financial destitution.

But in today’s Indonesia, the math of corruption infamously favors the offender. A corrupt official sentenced to five years in prison often serves only three after remissions and early parole. If that person has shielded tens or hundreds of billions of rupiah in hidden wealth, their prison stay becomes little more than a temporary occupational hazard. That money can buy comfortable cell upgrades inside. Outside, vast fortunes await their release.

Even worse, the country’s legal framework has repeatedly allowed former graft convicts to run for public office again. Once they win their seats, they step right back into the corridors of power they previously abused.

The asset forfeiture bill promises to break this cycle by introducing a mechanism known as non-conviction-based asset forfeiture. This mechanism allows the state to move against an individual’s ill-gotten wealth without first securing a criminal conviction. Instead, a separate civil proceeding tries the property itself (in rem), not the offender. This court evaluates whether an individual’s assets were acquired through legal and legitimate means. If a suspect flees the country, dies before trial, remains a fugitive, or avoids criminal conviction on technicalities, the state can still confiscate their unexplained wealth through a reversed burden of proof.

Yet, while the moral impulse driving this bill is indisputable, implementing it within Indonesia’s current judicial landscape presents a dangerous double-edged sword. We at The Reformist caution that an uncritical rush to enact this law without robust safeguards risks handing an already flawed state apparatus an unprecedented weapon for political repression.

The existing toolkit and current judicial realities

First, it is important to dismantle the myth that Indonesian law enforcement is currently powerless to seize criminal assets. Existing statutes — specifically the Anti-Corruption Law (UU Tipikor) and the Anti-Money Laundering Law (UU TPPU) — already grant prosecutors extensive powers to confiscate assets, levy restitution orders, and seize property linked to corruption convictions.

Consider high-profile cases (e.g., Harvey Moeis, Surya Darmadi) where prosecutors successfully sought multi-hundred-billion-rupiah fines and restitution payments alongside prison sentences. The legal mechanisms to strip convicted embezzlers of their ill-gotten gains exist and have been executed. The core bottleneck in asset recovery today is not a complete absence of statutory authority, but rather selective enforcement, weak investigative tracing, and political unwillingness to pursue financial flows to their ultimate destinations.

Second, and far more critically, anti-corruption enforcement in Indonesia does not occur in a pristine, neutral vacuum. Indonesia’s law enforcement apparatus remains deeply politicized, characterized by selective prosecutions, vague legal articles, and weaponized investigations. The Reformist has extensively documented glaring irregularities and dubious legal logic in recent high-stakes graft cases, in which political opposition, inconvenient ministers, and independent actors are targeted under elastic interpretations of “state financial losses”.

The best part is, this bill does not limit itself to assets linked to corruption or illicit enrichment, but assets tied to any ‘criminal’ activity. This means theoretically, the police could seize your car for the crime of running a red light. It’s an exaggeration, of course, but not theoretically improbable.

In a judicial ecosystem where law enforcement can be weaponized against political rivals, the asset forfeiture bill introduces a terrifying potential for abuse.

Imagine a scenario where an administration seeks to neutralize a prominent political adversary or an independent civic leader. Under standard criminal law, the state must meet a high burden of proof to secure a conviction. But under a broad asset forfeiture regime, the government could launch a criminal investigation while freezing or confiscating the target’s bank accounts, business holdings, and personal property in a parallel civil asset court.

By shifting the burden onto the individual to prove the absolute legality of every asset they own, the state forces targets to fight for their innocence on two complex, costly fronts simultaneously. Deprived of their financial assets overnight, targeted individuals are effectively stripped of the resources necessary to mount a proper legal defense, destroying their businesses, reputations, and political viability long before a single criminal verdict is reached.

The bill must be accompanied by airtight safeguards

We all despise corruption, and we recognize the urgent need to make graft economically unviable. However, we must ensure that the tools designed to eradicate corruption do not become the very instruments used to dismantle democracy and silence dissent.

If the House of Representatives (DPR) is to pass the asset forfeiture bill, it must conduct the deliberation process with absolute public transparency, not rush it through midnight legislative sessions behind closed doors. The House must also make its latest draft publicly accessible. Anti-corruption advocacy groups, while supporting the bill’s passage for years, have said the latest draft they obtained is missing key provisions.

To prevent abuse, the legislative framework must embed robust procedural safeguards into every stage of the forfeiture process. Prosecutors must meet a high evidentiary threshold, requiring clear, verifiable predicate evidence of illegal activity rather than mere suspicion or anonymous tips, before freezing any property. The court must operate with strict judicial independence and mandatory timelines to prevent political actors from indefinitely tying up an opponent’s resources. It must also mandate immediate, full financial compensation and public exoneration whenever the state fails to prove its case.

The fight against corruption requires courage and potent legal tools, but above all, it requires unwavering adherence to the rule of law. A tool designed to restore justice must never be crafted in a way that allows authority to abuse it.

An earthquake of magnitude 7.7 hit Flores in East Nusa Tenggara (NTT) last week. Thousands of aftershocks followed, along with tsunami warnings. Houses destroyed. Hospital ceilings collapsed. Roads disappeared under landslides. At least 75 people died across Manggarai, Nagekeo, and the rest of NTT.

Over 27,000 families were displaced from their homes — gathered under plastic tarps in swamped local emergency centers — as officials arrived with supply drops and the usual promises of rapid reconstruction.

None of this was unpredictable. Indonesia is a disaster-prone country. We have seen the country endure countless disasters: floods, landslides, earthquakes, tsunamis, and forest fires. Yet, the same scenarios played out one disaster after another. Government responses often stop at delivering aid and photo-ops. They seldom reach real steps toward disaster resilience.

After last year’s devastating Sumatra floods, the government has talked of upgraded early-warning systems, enforced building codes, and fortified regional response budgets. Yet, almost a year on, thousands of people in Sumatra still live in temporary shelters, waiting on aid that never arrived, sitting next to infrastructure that never got rebuilt.

If the Sumatra flood was supposed to be the moment the state finally learned something about preparedness and resilience, the NTT earthquake proves it didn’t. It just waited for the cameras to point somewhere else – until the next disaster happens.

Indonesia sits on the Pacific Ring of Fire, wedged against active fault lines like the Flores Back-Arc Thrust, where tectonic activity happened and caused the latest earthquake. So an earthquake in our archipelago is no mystery. And yet the state seems to treat every earthquake as a shock nobody could have anticipated, as though our geography changed overnight.

National Disaster Mitigation Agency (BNPB) acting spokesperson Berton Panjaitan admitted to the press that the agency struggled to deliver aid to affected areas because of Flores’ difficult geography and landslide-destroyed road conditions. In some villages in Manggarai, for example, journalists reporting from the field observed no BNPB-branded orange tents in emergency camps, forcing displaced people to erect makeshift tents from bamboo and tarps.

Underneath these seemingly “acceptable” difficulties is a structural issue. This year, BNPB underwent a massive budget cut, from Rp 2.01 trillion in 2025 to Rp 491 billion in the 2026 state budget. In fact, the agency’s budget has decreased every year since 2021. Crazy to think that a disaster-prone country keeps cutting costs for disaster mitigation. Yes, Finance Minister Purbaya Yudhi Sadewa has reassured that the government has put aside Rp 5 trillion emergency disaster relief fund from the state budget, ready to use and can even be topped up when requested. But without transparent and consistent criteria, national sign-off to access urgent disaster funds might just add another bureaucratic layer in time of need.

Speaking of geography, physical isolation from landslides cutting off supply roads, severed cables, and entire power grids going down often gets talked about as an inevitable impact of nature’s wrath. But what it really shows is an infrastructure system with no backup.

Look at what happened in Palue Island, the region closest to the earthquake epicenter. The island went completely dark, literally and figuratively, as the quake knocked out the power grid and telecommunication towers. Coordination between responders fell apart. Villages lost contact with each other. Aid arrived late as ships were docked due to tsunami warnings. If only there were budgets for redundancies like satellite and power-grid backups for local government offices...

As with what happened in Sumatra, this natural disaster episode is a picture of regional autonomy meeting its limits. Yes, local governments are supposed to run the emergency response, but provinces like NTT have thin local revenue to begin with. Asking a cash-strapped regency to run field hospitals, shelter logistics, and crisis communications on its own, without real transfers from Jakarta, is an exhibit of failing decentralization.

After all, what incentives do Jakarta elites have for disaster preparedness and resilience? Handing out relief boxes and cutting a ribbon on a rebuilt clinic gets you on the news, but not funding seismic research or keeping a satellite network running in the background. It’s no surprise the state keeps investing in the visible, photogenic version of disaster response, while neglecting the “boring” parts that actually save lives before the ground moves.

We should be fair and acknowledge that disaster response, especially in a province with difficult terrain spread across hundreds of islands like NTT, is genuinely hard. Building redundant infrastructure everywhere is expensive in a way that’s easy to say and brutal to fund. But “expensive and hard” describes almost every serious governance problem. It shouldn’t be an excuse to do nothing. If anything, it should be a reason to start.

Sumatra should have forced this reckoning already. After the disaster hit in November 2025, it took the central government eight months to even propose more budget for Sumatra reconstruction. The questions are: in the months people waited for Jakarta to make a decision, how many lives were lost? How much hardship did the people have to endure on top of an already devastating disaster? And, most importantly, how much public trust has diminished?

We can’t allow NTT to be “abandoned” the same way once the story goes cold and the news cycle moves on. Things need to happen even if it’s unglamorous: ensuring the state allocates enough budget for disaster preparedness and allows room to build redundant infrastructure, such as backup power grids, especially for hospitals and crisis centers on islands at risk of isolation. The state should provide non-negotiable central funding for Regional Disaster Mitigation Agency (BPBD) offices in poor, high-risk provinces, instead of leaving them to fend for themselves.

Indonesia won’t stop having earthquakes. Whether they keep turning into mass casualties is a choice the state makes every year it doesn’t fund the “boring” stuff.

A livestream on the Presidential Secretariat’s YouTube channel was stopped abruptly after President Prabowo Subianto, in a meeting with Chamber of Commerce (Kadin) members at the State Palace on July 31, mentioned that he had heard that Iran possessed nuclear weapons. He went so far as to speculate that Saudi Arabia, the UAE, Qatar, and Egypt would likely seek them too. These off-the-cuff remarks he clearly had never run past anyone, prompting the technical team to cut the livestream to show a government ad and remove the segment from its official archived recording.

Within the next few days, the Iranian Embassy in Jakarta issued a formal statement denying the allegation on Instagram, insisting the country has “never pursued the possession of nuclear weapons.” Analysts pointed out that the unverified claim parroted allegations historically used by the United States and Israel to justify military posture, directly contradicting findings from the International Atomic Energy Agency (IAEA), which has found no evidence of a coordinated Iranian weapons program.

Prabowo did hedge his claim in that meeting by stating “it is said that [Iran has nuclear weapons],” but a head of state floating nuclear rumors to a room full of businesspeople fails to register that his “casual” remarks could instantly propel a diplomatic nightmare.

A pattern of “errors”

It is not the first time Prabowo’s “slip of tongue” has outrun diplomatic restraint.

In June 2023, while serving as Defense Minister, Prabowo delivered a presentation on Indonesia’s defense concept called “Trisula Perisai Nusantara” or the Nusantara Shield of Trident. He displayed a slide showing the 300-kilometer reach of Indonesia’s ballistic missiles, explicitly mapping Singapore, Australia, and the Philippines within the targeting radius.

Publicly diagramming neighboring partners within your strike zone is precisely the kind of imagery ASEAN foreign ministries spend decades trying to avoid. Broadcasting visual maps that imply neighboring partners sit in your crosshairs sends a tone-deaf message: we could hit you if we wanted to.

The thread connecting the missile map to the nuclear remark is a disregard for the basic mechanics of global statecraft, in which a single phrase alters deterrence, triggers formal inquiries, and demands immediate damage control.

Prabowo is the foreign policy

Prabowo has made it quite clear that Indonesia’s international posture is run by him and him alone, effectively sidelining the diplomatic bureaucracy and bypassing the institutional checks built into the Indonesian Foreign Ministry.

But if one insists on playing the role of chief diplomat and taking full ownership of the nation’s foreign affairs, one needs to actually act like one, which means exercising basic diplomatic discipline, exercising restraint, and watching every single word that one uses in formal meetings.

There is no walking back an offhand comment once a foreign embassy is forced to issue a formal denial and international observers begin questioning why the president’s information conflicts with international atomic inspectors. In global politics, “unfiltered” is synonymous with “reckless.” Clumsy commentary risks alienating strategic partners, entangling Indonesia in foreign disputes, and eroding Jakarta’s reputation as a dependable, rational mediator.

Two things to course correct

We are not saying Prabowo should cease being an active and hands-on leader on foreign policy. Instead, we believe he should re-establish basic operational discipline to protect the country’s strategic interests.

First, the president needs to empower and “reintegrate” with the Foreign Ministry.

The ministry must have a real seat at the table before the president delivers speeches touching on foreign militaries, nuclear programs, or contested territories; not afterward, when the job has shifted to damage control. The administration must return institutional advice and diplomatic vetting not as bureaucratic hurdles but strategic assets.

Second, Indonesia must institutionalize speech discipline.

Someone close to the president must be able to intervene before he walks on stage, ensuring that unvetted lines about foreign weapons programs do not make it into strategic or formal speeches. When discussing sensitive international affairs, adhering to prepared remarks and reading off the prompter is standard operational discipline practiced by world leaders to safeguard national standing.

Personal charisma has its place in global governance, but it must be anchored by institutional rigor. That is the difference between a leader who improvises with impunity and one who gets to keep improvising because he is disciplined about where he does it.

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Public sector reform in Indonesia often seems like a myth. Yet, true reform occasionally takes place, as we’ve seen in Bank Indonesia (BI) under Perry Warjiyo’s leadership. When he exited the governor post on 25 July after 8 years, the central bank bid farewell to one of its most consequential technocratic leaders.

His early departure comes as a shock, though it should not be surprising considering the familiar political theater. In May, a member of parliament demanded Perry’s resignation in a hearing amid volatile global markets and a plummeting rupiah. He was a convenient scapegoat, but currency fluctuations — driven by global capital flows and by investors’ trust — are not personal failures of the central bank governor.

But history will judge Perry not by the daily exchange rate ticker, but by the institutional resilience Bank Indonesia strengthened during his tenure.

The stability we took for granted

BI’s primary mandate (at least until the passing of the recent P2SK law) is very simple: to maintain the stability of the rupiah’s value, or to keep inflation under control. Under Perry’s watch, this mandate was executed with a masterclass in quiet discipline.

Think of the shock from the Covid-19 pandemic. Indonesia managed to navigate the storms of fractured global supply chains and disrupted economies without spiraling into hyperinflation. Through calculated measures, BI kept the macroeconomic ship upright. For instance, it successfully balanced the “burden-sharing” mechanism with the Finance Ministry without undermining their independence.

The political dividends of this stability are often underestimated. Much of the enduring public approval enjoyed by the Jokowi administration can be traced directly to kitchen-table economics: that ordinary citizens could still afford basic goods.

Contrast this with the political turbulence seen in Western democracies, such as the United States, in which the Biden administration suffered severe electoral and public approval battering primarily due to raging post-pandemic inflation, which eventually led to the second election of Donald Trump.

In Indonesia, consumers were largely spared that trauma. BI under Perry left the economy unscathed, proving that prudent monetary management is the ultimate social safety net.

The digital payments revolution

If keeping inflation under control was the bare minimum expectation for a competent central bank governor, the true and indelible legacy of BI under Perry’s leadership lies in our digital payments infrastructure.

For decades, developing countries have remained digitally “colonized” by foreign financial gatekeepers. Over the past decade, Bank Indonesia increasingly treated payment infrastructure as strategic national infrastructure rather than simply financial technology. The National Payment Gateway (GPN), for example, reflects that long-term institutional vision. While the GPN was conceived before Perry Warjiyo took the helm, it was under his tenure that the initiative was institutionalized into a nationwide payment backbone, keeping domestic debit transactions within the country and reducing reliance on international payment networks such as Visa and Mastercard.

The strategic foresight of this move cannot be overstated. One only needs to look at Russia — where Western sanctions abruptly severed citizens from international payment rails overnight — to realize how vulnerable a digitizing nation is without domestic redundancy. This means Indonesia built its own fire escape before the fire even started.

Then came the retail payment system BI-Fast and Standard National Open API Payment (SNAP), which systematically lowered friction, driving down transaction costs, and knitting a fragmented archipelago into a real-time financial ecosystem.

Yet, the crown jewel of this revolution is obviously the Quick Response Code Indonesian Standard, or QRIS.

In the early days of the digital wallet boom, private sector giants like GoPay, OVO, and DANA each introduced their own proprietary QR codes, threatening to fracture the market into competing walled gardens. The masterstroke of BI under Perry was not inventing the QR payment, but excellent regulatory coordination. QRIS transformed a chaotic corporate race into a unified public utility.

Today, QRIS bridges the entire economic spectrum: it powers high-end retail boutiques just as effortlessly as it empowers street-side bakso vendors. Adoption has scaled to such a degree that urban discourse has fundamentally shifted. We are no longer debating how we might expand financial inclusion to small vendors. We are now debating whether vendors should be allowed to only accept QRIS and not cold hard cash. This shift was not an accident of the free market. It was engineered through deliberate, long-term regulatory orchestration by BI under Perry’s leadership.

A reformist’s legacy

As Perry Warjiyo exits the central bank, he leaves behind a large pair of shoes to fill. He proved that a state institution can be both fiercely disciplined and radically innovative, defending the citizens’ wallets from global crises while aggressively launching the nation into a cashless future.

Amid the noise of political grandstanding and short-term currency jitters, the broader picture is crystal clear: Indonesia’s financial resilience today is built on the foundations he laid. BI under his leadership offers a rare example of reformist governance in practice. In a political environment often consumed by short-term pressures, that may ultimately be his most enduring contribution.

When Lee Kuan Yew set out to build modern Singapore, he didn’t start with tax incentives or infrastructure. He started with the legal system. No investor, business, or citizen trusts a state where enforcement depends on political patronage or executive whim. Legal certainty wasn’t a byproduct of stability for Singapore, it was the precondition for both.

Indonesia’s official creed of course is that we are a negara hukum, a rechtstaat, a constitutional state governed by law. The Febrie Adriansyah affair says otherwise. What Tempo’s Bocor Alus reporting describes isn’t a rechtstaat at all, but a machtstaat or power state operating in plain sight: legal status negotiated behind closed doors, law enforcement agencies acting as rival fiefdoms, and the president stepping in to insulate his own people from accountability.

Febrie, until recently head of the Attorney General’s Office (AGO) for extraordinary crimes (Jampidsus), came under police investigation for alleged bribery and money laundering connected to the Asabri and PLN coal procurement cases. Police seized 74 kilograms of gold and nearly half a trillion rupiah in cash. That should have been the start of a straightforward prosecution. Instead it set off a scramble to manage the politics before the law could catch up.

Tempo’s reporting lays out the mechanics: Defense Minister Sjafrie Sjamsoeddin and other insiders lobbying President Prabowo Subianto directly, trying to keep Polri from naming Febrie a suspect, or at least to move the case back under the Attorney General’s own roof where it could be handled more quietly. Tempo also reported that businessmen linked to the case were approached to claim the seized gold as their own, a way of pulling the evidence out of Febrie’s orbit without anyone having to explain where it actually came from.

And eerily, what actually drove the president’s involvement wasn’t a concern for the investigation’s integrity but desire to keep the story from becoming political noise, or kegaduhan.

The people behind criminalizations

We’ve written before about how prosecutorial power in Indonesia gets aimed selectively at business and public officials alike. This case shows where that architecture breaks down: the same agency wielding those tools against everyone else claims the same informal immunity the moment its own leadership is the target.

Part of what makes that double standard so galling is how aggressively the AGO, and more specifically the Jampidsus office has been willing to stretch the law when the target is someone else. Articles 2 and 3 of the corruption law were written around the idea of state loss, the kerugian negara. In recent years, prosecutors from the AGO office have leaned on a reading loose enough to bring charges without much more than a policy decision that went badly or a business call that, in hindsight, cost the state money. Actual enrichment, a bribe, a kickback, a diverted asset, has become almost optional. The mere existence of a loss, however indirect or contested the accounting, has been enough to build a case on.

That’s the same expansive reading that turned a business-judgment dispute into a headline corruption verdict, and it’s the same one that keeps company executives negotiating with the AGO rather than the courts, because the line between a bad deal and a crime has gotten so blurry that nobody wants to test it in front of a judge. When the standard for what counts as corruption is this elastic, the agency applying it holds enormous discretion over who gets charged and who doesn’t.

And this is where the Febrie case cuts deepest. If the unit running these prosecutions is itself compromised, the public has every reason to look back at Jampidsus’s own high-profile arrests. Was that businessman charged because the evidence held up, or because he didn’t funnel enough gold to Febrie’s acquaintances? An agency running enrichment cases on a loose reading of the law loses all credibility to do so the moment it turns out the people bringing those cases were taking gold themselves.

We need to clean house

Fixing this isn’t a matter of reshuffling personnel or issuing a statement. The most basic problem is structural: we can’t expect the AGO to police itself, and right now that’s effectively what’s happening whenever the target is one of its own. If Jampidsus is compromised, that should be a KPK case, not an internal AGO matter, the same way we wouldn’t ask a police precinct to investigate its own commander for taking bribes.

What this actually calls for is a president willing to clean house, starting with Jampidsus itself, and treat legal certainty as something worth more than avoiding a bad news cycle. Prabowo built his campaign on promises of law enforcement without fear or favor. This is the test of whether that meant anything, or whether “no fear or favor” stops the moment the favor in question is his own.

Prabowo has set his sights on 8 percent economic growth. That number doesn’t happen without investors trusting Indonesia’s legal system enough to bet on it for the long haul. Unless legal reform becomes something the president takes as seriously as the growth target itself, the only 8 percent he’s likely to hit is his approval rating.

Back to Mr. Lee, he decided that Singapore would keep the Judicial Committee of the Privy Council in London as its final court of appeal long after independence to give “foreign investors a guarantee of impartiality that local courts alone couldn’t offer yet”. We are not suggesting Indonesia outsource its law enforcement or judiciary like Mr. Lee did, but we do need to do something.

Another day, another public uproar. The culprit this time is an itinerary leaked online that shows a plan for Public Works Minister Dody Hanggodo to visit New York, United States. What upset the public, however, was that his wife and daughter were on the official entourage list — and that the timing was suspiciously aligned with the final matches of the World Cup.

The ministry has clarified that the minister’s wife and daughter were included in the list for visa purposes and that no public funds were to be used for their trip. After the leak went viral, however, the entire excursion was canceled.

But the story didn’t end with an apology to taxpayers, a scrutiny of travel budgets, and a revised code of ethics. Instead, the ministry leadership took a more vindictive turn by asking, “Who’s behind this leak?” and went on to say that if they found the leak was internal, they would reprimand the culprit because “the letter wasn’t meant for public consumption.”

Within a few days, more rumors spread online that the ministry was planning waves of demotions and transfers to remote locations across the country, allegedly due to the viral case. This wave reportedly affected teams across units, including the secretariat responsible for planning the trip and drafting the document.

On 15 July, Minister Dody denied the allegation that the massive transfers were due to the leaked document, though his reasoning was unconvincing. “Transfers are no big deal. I have 38,600 employees; why can’t they be transferred?” he told the press.

Interestingly, there were earlier reports that Secretary General Apri Artoto, who told the press that the ministry would find and punish the culprit behind the leak, was among those affected and is reportedly waiting for his transfer to Papua. But an internal Public Works Ministry source told the news site Suara.com that this wasn’t true and that the mass transfers were a routine reshuffling unrelated to the document leak scandal.

It’s true, transfers could be routine, but the suspicious timing quickly prompted public speculation.

While the issue of transfer due to the leak remains unconfirmed, the statement that the ministry will punish the whistleblower is a red flag clear enough to signal a profound institutional failure that damages the Indonesian civil service on two fronts: (1) it aggressively stifles the nascent culture of internal whistleblowing; and (2) it reinforces a toxic, Jakarta-centric hierarchy that treats the rest of the nation as a penal colony.

Whistleblowing shouldn’t lead to witch hunts

For over a decade, successive administrations have paid lip service to the ideal of bureaucratic reform. They have reassured the public that the modern civil servant is no longer a passive cog in a feudal machine, but a professional driven by public integrity, transparency, and accountability. And younger, reform-oriented bureaucrats have been encouraged to challenge inefficient practices and stand against institutional decay.

However, the recent Public Works Ministry scandal has proven those assurances to be mere hollow rhetoric.

When a single document exposing an embarrassing truth led to a witch hunt and alleged mass demotions instead of reforms, the message sent down the ranks is unmistakable: loyalty to the hierarchy supersedes loyalty to the public. If you witness waste, mismanagement, or abuse of state facilities, you must look away. To speak out is to court professional ruin.

Whistleblowing is inherently risky, but the punishment meted out here alters the calculus entirely. By allegedly enacting collective punishment, the ministry forces public servants into a defensive pact of mutual silence.

A junior officer harboring reformist ideals would no longer dare to question a suspicious procurement order or a wasteful budget allocation if the consequence is the immediate uprooting of their livelihood and family. The system has chosen to value absolute opacity over basic accountability, ensuring that future bureaucrats will choose complicity as a survival mechanism.

Threats of “remote exile” reinforce a toxic Jakarta-centric view

The second, and perhaps more insidious, consequence of this alleged mass transfer lies in its geographical symbolism. By using transfers to remote regions as an explicit tool of chastisement, the Public Works Ministry has laid bare a deeply outdated worldview: the belief that Jakarta is the apex of professional existence, and that the rest of Indonesia is a wasteland reserved for the punished.

This is not the first time political figures or institutional leaders have reinforced this mindset. The phrase “exile to Papua,” or similar threats of banishment to distant provinces, has slipped from the mouths of officials seeking to discipline errant subordinates from time to time.

Jokowi-era Social Affairs Minister Tri Rismaharini, for instance, notoriously threatened to banish incompetent officials to Papua. This is a “habit” that undermines every single policy initiative aimed at regional equity and decentralization.

One administration after another has frequently promoted the narrative of an Indonesia-centric future. Billions of rupiah are funneled into infrastructure projects, regional connectivity hubs, and digital access for outer provinces under the guise of leveling the playing field. Yet, the moment an internal crisis occurs in the capital, the outer regions are instantly weaponized as geographical punishments.

This practice is an insult to the citizens living in those provinces. The communities in remote parts of Sumatra, Sulawesi, Kalimantan, Nusa Tenggara, Maluku, and Papua deserve the highest caliber of civil servants — professionals who bring dedication, resources, and a genuine mandate to build the regions. They do not deserve a disgruntled cohort of Jakarta exiles whose presence is the direct result of a political purge.

Furthermore, this dynamic perpetuates a toxic career trajectory within the bureaucracy. It solidifies the idea that a posting outside the capital is a mark of failure or disgrace, rather than a crucial step in nation-building. If the state itself treats the archipelago as a hierarchy of privilege with Jakarta at the center, it cannot expect its brightest minds to willingly dedicate their talents to the periphery.

Set your priorities straight

The worst thing that this scandal exposed is how the administration has treated the exposure of the problem as a far greater transgression than the problem itself.

Let us be completely clear: the fundamental issue was never the leak. The document in question did not compromise national security, nor did it expose sensitive state secrets. It revealed a planned allocation of public funds for an international trip that lacked a clear, verifiable public benefit. A trip that was canceled the moment it faced public scrutiny.

The cancellation itself is an admission of guilt. If the trip were truly essential to the functions of the Public Works Ministry, the ministry would have defended it with hard data and clear objectives. But they didn’t, simply because they couldn’t.

Thus, the problem is, and always has been, the persistent culture of wasteful, non-essential official travel that treats the state treasury as a personal travel agency.

While the ministry has said that the document is not for public consumption, the public absolutely deserves transparency about how, why, and where their tax money is spent.

The individuals who exposed this attempted misuse of public funds actually performed a valiant public service. To punish them for this exposure is an act of blatant misdirection; an attempt to shift the focus from a minister’s poor judgment to a civil servant’s supposed lack of loyalty.

We call on President Prabowo and the Administrative and Bureaucratic Reform Ministry to step in and scrutinize whistleblowing systems across ministries and other government bodies. An independent investigation must be launched to ensure that no whistleblower’s career is threatened after speaking up against maladministration, just as the Public Works Ministry leadership pledged to punish whoever leaked the itinerary document. Punishing the messengers while leaving the systemic issue unaddressed is a cowardly solution that does nothing to restore public trust.

To our civil servant friends who still believe in the promise of a clean and accountable Indonesia, do not let this display of institutional bullying convince you that silence is your only option; our opinion columns and editorial desk will remain an open and secure platform for anyone who wishes to anonymously blow the whistle on corruption and mismanagement.

We commit our editorial resources to thoroughly verify your information and will exercise our Right of Refusal to guarantee your anonymity under the law, ensuring that while your superiors may have the authority to disrupt your career, they do not have the power to control the truth. Reach out to connect@thinkpolicy.id.

The appointment of Ginka Ginting, a 27-year-old electoral campaign volunteer with no professional track record beyond student organizations, to the board of commissioners of PT Pertamina Retail has sparked an understandable public outburst across social media. But what followed was rather predictable: a collective, resigned shrug.

Or, as the cynics say: Isn’t it a time-honored tradition to treat the boardrooms of State-Owned Enterprises (SOEs) and their lucrative subsidiaries as a dumping ground for political IOUs?

In 2021, rock musician Abdee of ‘Slank’ was appointed as an independent commissioner of telecommunications giant PT Telkom Indonesia. Observers have pointed out that his appointment was a ‘payback’ for his support as a campaign volunteer for then-President Jokowi’s presidential runs—both times.

Even more mind-boggling: Dede Budhyarto, another Jokowi loyalist, was unseated from his independent commissioner position in PT Pelni amid allegations of a falsified diploma from Universitas Hasanuddin.

We have also seen it with party loyalists, losing legislative candidates, and influential campaign operators for decades. So, to say that these appointments are shocking is to ignore the historical mechanics of Indonesian political coalitions. It is unfortunately a well-entrenched and thoroughly normalized status quo.

The danger of undermining the roles of commissioners

However, normalcy shouldn’t be conflated with rightfulness. The sheer persistence of political patronage in state firms has bred a dangerous cultural assumption that the role of a corporate commissioner is: (1) a symbolic, part-time honorarium; (2) a comfortable but highly compensated retirement home or a youthful stepping stone; or even worse (3) a state-funded “thank you” note.

By consistently treating commissioner seats as political currency, the state sends a damaging message to both the public and the market that corporate oversight in institutions managing trillions of rupiah of public wealth does not actually matter. It reduces a vital pillar of corporate governance to a secondary reward mechanism, operating on the assumption that a commissioner’s office exists solely to occupy space, sign papers, and collect a paycheck, without exerting any real influence over how a company is run.

This perspective fundamentally misunderstands the constitutional and corporate purpose of a commissioner. In a standard private corporation, a Board of Directors (BOD) runs the daily business, while the Board of Commissioners represents the financial and strategic interests of the shareholders who privately funded the venture.

In the context of an SOE, the ultimate shareholders are not a small group of elite venture capitalists; they are the citizens of Indonesia. Every rupiah an SOE mismanages, wastes, or loses to corruption is money pulled directly from public infrastructure, healthcare, and education.

If the BOD takes reckless strategic risks, misallocates national assets, or engages in creative accounting to hide operational failures, it is the explicit duty of the commissioners to step in, demand an immediate course correction, or exercise their ultimate corporate power: calling a general meeting of shareholders to oust the executives.

Competence is critical for a commissioner role

To execute such a high-stakes mandate, a commissioner must possess a rigorous, non-negotiable level of professional competence. Corporate governance is not an abstract exercise in ethics or a job that can be learned via standard on-the-job training. It requires deep technical expertise in corporate finance, forensic accounting, regulatory compliance, and industrial strategy.

If a commissioner cannot read a complex balance sheet, identify hidden liabilities, or independently evaluate capital expenditure plans, they are effectively a blindfolded watchdog. They cannot audit what they do not comprehend.

When an executive board presents a polished, overly optimistic quarterly review, an unseasoned or politically appointed commissioner lacks the tools to look beneath the surface. They are left entirely vulnerable to being duped, manipulated, or managed by the very executive directors they are legally obligated to oversee. They become compliant rubber stamps, validating corporate disasters long before the public ever catches wind of them.

We do not need to look to theoretical corporate textbooks to understand what happens when an independent professional actually does the job. In fact, we have a striking historical roadmap from our own recent past.

In April 2019, the executive leadership of Garuda Indonesia proudly announced a miraculous financial turnaround, claiming a consolidated net profit of US$ 5 million for the 2018 fiscal year. It was hailed as a massive public relations victory for a deeply troubled national carrier. However, two commissioners representing a minority corporate stake, Chairal Tanjung and Dony Oskaria, flatly refused to sign off on the financial report.

Both seasoned corporate professionals with deep financial acumen, Chairal and Dony immediately spotted an egregious accounting manipulation. The executive board had recognized a 15-year, uncollected future contract with an in-flight Wi-Fi provider as immediate, current revenue.

Their professional defiance and refusal to look the other way triggered an official regulatory intervention by the Financial Services Authority (OJK) and the Finance Ministry. The subsequent forced re-audit stripped away the accounting fiction, forcing Garuda to restate its books and expose a staggering US$ 175 million net loss.

Without independent and highly competent professionals willing to disrupt the boardroom peace, a massive deception would have sailed through unnoticed, hiding systemic operational rot beneath a veneer of fake profitability.

A glaring contradiction

The ultimate structural irony of today’s political appointments sits at the very pinnacle of Indonesia’s current economic architecture.

Dony Oskaria—the very man who blew the whistle at Garuda and saved the public from a massive corporate lie—now serves as the Chief Operating Officer of Danantara and Head of the SOE Regulatory Agency. Danantara has been engineered as a revolutionary sovereign wealth fund and a superholding entity designed to consolidate, restructure, and supercharge Indonesia’s sprawling state assets into a lean, globally competitive economic engine.

The current administration has repeatedly positioned Danantara as a historic step toward world-class corporate governance, efficiency, and credibility in international markets. Dony knows better than anyone in the country that rigorous, independent, and fiercely professional oversight is what prevents state assets from collapsing under the weight of inefficiency and corruption.

Yet, a glaring contradiction is that while the upper echelons of government build Danantara to project global financial sophistication, the ground-level reality of subsidiary appointments remains unchanged. The state cannot credibly claim to be building a world-class asset management system while simultaneously handing out seats on subsidiary boards, such as Pertamina Retail, to amateurs who have never managed a corporate balance sheet.

Are we paying commissioners too much?

This governance failure is made even worse by the extraordinary and often hidden compensation packages attached to the commissioner roles. In Indonesia’s SOE ecosystem, a commissioner’s remuneration is legally pegged to the executive payroll. A President Commissioner receives roughly 45 percent of the CEO’s salary, while an ordinary commissioner is entitled to 90 percent of that amount—effectively taking home around 40.5 percent of the chief executive’s baseline pay.

In mature corporate governance models, non-executive board directors are typically compensated with flat, reasonable annual retainers and modest meeting fees. This structure is intentional; it ensures that their financial well-being is not overly dependent on executive performance metrics, thereby preserving their absolute independence to critique the management.

In Indonesia, we have flipped the script entirely. We have created a system where political appointees are paid a king’s ransom for part-time, non-executive oversight, all while requiring absolutely zero professional skin in the game.

For example, members of the Board of Commissioners at PT Bank Mandiri Tbk were paid a total of Rp5 billion (US$ 270,000). By contrast, an independent board member at ICBC—a Chinese SOE bank generating roughly 13 times more net profit than Mandiri and is the biggest bank in the world—was compensated just RMB 400,000-500,000 (US $70,000) that same year. The year before, when the tantiem had not been scrapped, Kompas reported a single commissioner at PT Bank Mandiri Tbk was paid Rp 38 billion (US$ 2.4 million) in 2024.

Bring back meritocracy to the boardroom

If Danantara and the broader Indonesian state enterprise sector are ever to be taken seriously by international investors, the government must permanently dismantle this political welfare system. SOEs are commercial entities funded by the public sacrifice, not private piggy banks or political rewards. We must establish rigid, transparent, and legally binding meritocratic criteria for all commissioner appointments across every tier of state-owned enterprises and their subsidiaries.

The criteria must demand proven track records in corporate leadership, financial management, or sector-specific technical expertise. A political campaign or a loyal network should never serve as a substitute for a professional resume. Indonesia faces complex global economic headwinds that require our state enterprises to operate at maximum efficiency and peak transparency. To achieve this, we desperately need sharp, uncompromised professionals who know how to guard the national treasury, not a continuous rotation of political loyalists who are just happy to be in the room.

Two days ago, 30 June, the court sentenced former Education Minister Nadiem Makarim to ten years in prison. He also has to pay Rp 809 billion in restitution, or else serve another five years.

Nadiem has been on trial since last year for allegedly causing state losses in the procurement of Chromebooks during his term in office.

But he is not the first public official or government consultant to be named a graft suspect without ever taking a dime of public money. Apparently, under Indonesia’s corruption law, any act that can be regarded as an abuse of power resulting in state or economic losses can be charged as corruption. We’ve written about it here.

Criminalization of the Chromebook policy

The case stems from a massive Education Ministry initiative to procure hundreds of thousands of laptops for public schools across Indonesia. To ensure these devices could be managed remotely, monitored for appropriate student use, and updated securely at scale, the ministry required the laptops to include a centralized Device Management system. As Windows-based alternatives with equivalent management software were significantly more expensive, the technical requirement effectively made Google’s Chromebook the only financially viable option for the mass rollout.

State prosecutors and the court interpreted this specific technical requirement not as a cost-effective choice for cloud-based education, but as a deliberate attempt to lock the project specifications to benefit a single proprietary ecosystem, Google, forming the core of the corruption charges against Nadiem.

The alleged conflict of interest rests on the fact that Google had invested in Gojek years earlier, the company Nadiem co-founded, which he left before joining the cabinet.

The problem with treating that as proof of a quid pro quo is timing: The bulk of Google’s investment in Gojek-linked entities happened before Nadiem became minister, not after, which cuts against the idea that the Chromebook decision was payback for money he’d already received years earlier.

A prior investor relationship that predates the office in question is a weaker basis for a conflict-of-interest finding than one that develops during it. Of course, that doesn’t make the specification choice above scrutiny. Still, it’s a meaningfully different claim than “he steered a contract to a company that was paying him” – and the verdict doesn’t appear to draw that distinction.

The court also determined that the Development Finance Comptroller (BPKP)’s finding of Rp1.56 trillion in state losses was valid, even though, constitutionally, only the Supreme Audit Board (BPK) has the authority to audit government programs and determine state losses. A former BPK head testified in court that the methods used by the BPKP were dubious at best, often relying solely on sampling data. That distinction is not procedural nitpicking: an audit institution without constitutional authority to declare a state loss produced the single number the entire prosecution hangs on.

Moreover, the old audit logic was built for static assets. If a government construction project procures more cement than it needs and it hardens unused in a yard, that is an obvious, quantifiable loss.

But technology does not behave like cement. Tech procurement is inherently a bet on an ecosystem and a mass adoption curve. Today, the overwhelming majority of those Chromebooks remain operational in classrooms. Can the small fraction that is not fairly labeled a criminal state loss? If 100 percent efficiency is the benchmark for legality, then countless other flagship government initiatives are structurally criminal.

The phantom enrichment

Here is a part of the verdict that should unsettle anyone who thinks the ruling was a clean finding of guilt: the panel of judges explicitly ruled that it was not proven that Nadiem had unlawfully enriched himself. He was convicted of abuse of authority causing state losses — a separate charge — and one judge on the five-member panel dissented outright, saying he saw no convincing evidence of malicious intent.

And yet, the restitution order treats the Rp 809.59 billion as a personal financial benefit requiring repayment. That sum was never a liquid payout, a bribe, or a slush fund extracted from the state budget. It was a standard, closed-loop corporate balancing act between a parent company, PT Aplikasi Karya Anak Bangsa (AKAB), which Nadiem founded, and its subsidiary, PT Gojek Indonesia.

Ahead of the Gojek-Tokopedia (GoTo) merger and IPO, Gojek needed to clear a pre-existing debt owed to AKAB, most of which traced back to a roughly US$ 787 million investment Google had made in AKAB years earlier. Gojek issued new shares to AKAB, AKAB paid for them, and on the same day, Gojek transferred the exact same amount back to extinguish the debt. No cash left the corporate group. Not a single rupiah ever entered Nadiem’s personal pocket, and he has said he never had access to the funds.

Restitution in Indonesian corruption law is meant to claw back what a defendant unlawfully gained. Here, the court seems to have imposed a giant number because it was the most legible figure in the case file, not because it traced to anything Nadiem actually received. That is a more serious problem than misread accounting. It’s simply that the personal liability and the enrichment finding don’t align.

How can we expect public officials to do reforms when a jail sentence is lurking?

The immediate consequence of this legal overreach is complete bureaucratic paralysis. When any innovative policy decision can be retroactively branded an abuse of power, the incentive to reform vanishes entirely. Public officials would quickly realize that the only way to protect their freedom is to strictly maintain business as usual. The system effectively mandates safety through mediocrity, actively punishing anyone attempting to modernize state functions.

Worse, this creates a chilling effect that will permanently repel external talent from entering government service. The court’s logic in this verdict implies that simply having once held equity in a company that later interacts with state policy can be twisted into a criminal conflict of interest, years and job changes later. The state will be run exclusively by career bureaucrats who know how to navigate checklists, shutting out the expertise Indonesia needs to compete globally.

We have to talk about state losses

If “state losses” is to remain the primary weapon used to lock a professional away for a decade, the financial calculation behind it must be flawless, robust, and beyond institutional dispute. In this case, it was neither: the number came from an agency the Constitution doesn’t authorize to make that finding, using a methodology its own former leadership called unreliable.

The double standard this exposes isn’t hypothetical. While a former minister is being personally bankrupted over a disputed audit of a program that mostly worked, the current administration has been writing the opposite protection into law for its own flagship program. A financial-sector law passed this week shields purchases of bonds issued by Danantara, the sovereign wealth fund chaired by senior cabinet figures, from criminal, civil, and tax investigation. The bond records can’t even be used as evidence in court.

One government program gets audited by an agency with no constitutional standing to do so, and the finding becomes a decade in prison. Another gets statutory immunity from scrutiny by design. If the legal system can carve out investigation-proof status for the state’s biggest current bet, it is hard to argue in good faith that a defensible laptop specification from 2020 deserved the opposite treatment.

What’s next

If there is a fix, it starts with restoring BPK’s constitutional exclusivity in practice, not just on paper. No state-loss finding should support a criminal conviction unless BPK, not BPKP, produced it.

Alongside that, Indonesia needs something closer to a business-judgment standard for technical and procurement decisions made in good faith with documented rationale: the question in a courtroom should be whether an official enriched themselves or acted with corrupt intent, not whether their engineering choice turned out to be litigable in hindsight. Without that distinction, the same instrument now being used against Nadiem is available, at will, against the next official who tries to build something.

None of this is an argument for easing up on corruption enforcement. It’s the opposite. Indonesia has no shortage of cases with an actual bribe, an actual bank transfer, an actual official who got personally richer while a program collapsed. The Chromebooks still running in classrooms today are simply not that.

When prosecutors and courts spend their credibility and the public’s attention manufacturing a state loss out of a defensible technical spec, that is institutional capacity not spent on the cases where the money really did disappear, and someone really did pocket it.

Treating every costly policy bet as a potential decade in prison doesn’t make the anti-corruption regime look tougher. It makes it look undiscriminating, and it lets the real cases blend into the noise of all else being prosecuted with equal ferocity. If the goal is actually deterring theft of public money, the system needs to be able to distinguish that from a minister who made a call that didn’t pan out perfectly.

We’ve written previously that a controversial provision in the now-passed Law on Financial Sector and Strengthening (UU P2SK), which adds a growth mandate to Bank Indonesia (BI), could erode investors’ trust in the central bank’s independence. But turns out there’s a provision more egregious in the newly minted law.

Meet Article 50A of UU P2SK. A provision that allows Indonesia’s sovereign wealth fund Danantara to issue specific loan instruments, dubbed “Patriot Bonds” and “Merah Putih Bonds,” carrying a startling perk: an absolute immunity from criminal, civil, and tax investigations.

The article explicitly states that transaction data on the purchase of these bonds cannot be used as a basis for tax assessments or as legal evidence in court.

For all practical purposes, Indonesia has just institutionalized a recurring, permanent tax amnesty program, hidden inside the fine print of a financial sector law.

Let’s run the scenario. You have a stash of questionably acquired funds that you cannot spend without raising suspicions. If you purchase the Patriot Bonds, authorities can never come after you to ask how you acquired those funds. Now, doesn’t it closely resemble the tax amnesty program?

But a tax amnesty is supposed to be a historic, one-time compromise.

The logic is simple: the state offers a temporary clean slate to bring hidden wealth into the formal economy, widening the tax base for the future. Yes, it is problematic for the country’s economic justice, fiscal credibility, and institutional transparency — not to mention that it is fundamentally unfair to the millions of honest, taxpaying citizens — but it is somewhat tolerable as a pragmatic tool to reset the system if it happens once.

But when amnesties become a recurring fixture, disguised as “patriotic” investment bonds no less, the logic just collapses. Why would anyone comply with standard tax rates if they can simply wait for the next state-sanctioned amnesty? Instead of broadening the tax base, this “no-questions-asked” mechanism rewards tax evasion and shrinks tax receivables, creating a moral hazard that hollows out compliance.

Finance Minister Purbaya Yudhi Sadewa has denied allegations that Patriot Bonds amount to a form of tax amnesty, arguing that investors who purchase the bonds won’t automatically become immune from all legal ramifications.

“It’s just the money [used to purchase the bonds] that is immune, not the company. Unlike tax amnesty, which grants immunity [to the company too],” he said.

But that isn’t reassuring enough. If the funds used to purchase the bonds are protected from scrutiny, then purchasing the bonds effectively becomes a legal loophole for those seeking to launder illicit funds, just like the tax amnesty program. Even worse, whereas one would have to pay a penalty on declared assets under the tax amnesty program, the Patriot and Merah Putih bonds would instead generate some interest.

What’s more alarming, however, is how this policy came to light. Over two weeks after the law was reportedly passed, the official text of UU P2SK still cannot be found on any public government portal. One couldn’t simply find it on the House of Representatives’ (DPR) site or any official legal documentation and information network (JDIH) sites. To actually get our hands on the text of the P2SK Law, we were forced to find leaked drafts and press reports.

This case is just an instance of a worrying legislative trend in Indonesia, in which crucial bills are drafted behind closed doors, rushed through approval, and shielded from public scrutiny until it is too late. But this case is especially bad because a policy that could potentially grant alleged tax evaders immunity from criminal prosecution should be fiercely debated in the public square, not snuck into a final draft that the public couldn’t even find to read.

The government may argue that the Patriot and Merah Putih bonds are necessary to fund national development. But financing the future by dismantling the rule of law and undermining the fiscal contract is a losing strategy. Capital might flow in today, but institutional credibility—once burned—takes decades to rebuild.

The arrest of Dadan Hindayana, the Head of the National Nutrition Agency (BGN), along with his two deputies, was nothing short of dramatic. But are we surprised?

We all saw it coming. The agency, which administers the implementation of President Prabowo’s flagship Free Nutritious Meal (MBG) program, has been under public scrutiny due to its massive Rp 268 trillion in state funding. But the nationwide initiative was rolled out under a cloud of systemic vulnerabilities: vague accountability mechanisms, opaque kitchen partnerships, and a rush for scale.

The Attorney General’s Office (AGO) alleged that Dadan and his deputies funneled lucrative kitchen management contracts through personal, closely tied foundations. It exposes how vulnerable the program was to greed. A multi-billion-dollar procurement budget, coupled with the decentralized distribution of daily meals and a lack of strict governance, has turned public welfare into a private feeding frenzy.

Yet, as devastating as this scandal appears in the headlines, it offers the government a rare political gift: a clean slate to start over.

It’s no secret that bureaucratic failures often trigger defensive PR campaigns to save face. But in BGN’s case, there is no need to play defensive. There is no face left to save for the previous management. Now that the rot has been excised, the government should just openly admit that the initial governance framework was deeply flawed.

This arrest may not be the death knell of the MBG program, but rather a signal of a chaotic, necessary rebirth towards its institutional maturity.

That said, we are seeing somewhat encouraging indications that the new leadership intends to use this crisis wisely.

Immediately after her appointment, the new BGN head, Nanik S. Deyang, announced a moratorium on the construction of new Nutrition Fulfillment Service Units (SPPGs). Despite her own controversies (which include dismissing criticisms of MBG), Nanik’s new direction for MBG is a necessary operational brake the program needs.

Civil society groups have warned for months that the expansion of these partner kitchens without established standards was fertile ground for procurement fraud. Pausing the expansion, on the other hand, will allow the government to freeze the bleeding, audit existing sites, and restructure operations without the pressure to hit arbitrary rollout targets.

Nanik also mentioned that she would refocus the program to prioritize beneficiaries in the “left-behind” (frontier, outermost, and disadvantaged, or 3T) regions. This is a welcome change. Rightly so. But Nanik was quick to follow up by stating that MBG in the 3T regions should be funded through contributions from foreign partners and philanthropies rather than relying on the state budget.

That statement makes one raise their eyebrows as it brings us back to square one: BGN sees evidence of inefficiency, but immediately shifts the burden elsewhere rather than addressing the root cause. If stopping MBG is out of the question for this administration, then at least they must stop the leakage of trillions of public funds.

Learning from this brouhaha, the new administrators should acknowledge that corrupt officials have been exploiting blind spots in MBG implementation, which originated from the administration’s impetuous appetite to achieve “greatness” (millions of people fed, thousands of kitchens built, millions of new jobs created) overnight.

Thus, if they want to go on, this is the momentum to first rethink what MBG wants to achieve and, thus, how best to design the program to get there. (We’ve previously argued in this article that MBG is unsure of what problem it wants to solve.)

Obviously, when they figure this out, they also need to address operational problems that have been the cherry on top of this whole fiasco: ensure standardized and transparent procurement, empower independent oversight, and prioritize quality over velocity.

A chance to course-correct

The President’s decisive purge of the old guard proves that the administration understands the stakes. Let’s be realistic: the MBG program cannot and will not be rolled back. It is the defining campaign promise of this administration, and millions of families are already counting on it. But precisely because it is here to stay, the government must treat this crisis as an unprecedented, probably unrepeatable opportunity to course-correct.

The moratorium and the arrests are aggressive first steps in the right direction, but they are just the prologue. We urge the government to follow through with absolute, unyielding structural reforms. This is the moment to drop the political theater, build the system the right way from the ground up, and ensure that a program meant to nourish the nation’s children would not serve to line the pockets of its elites, ever again.

In the high-stakes world of Indonesian public policy, a new terrifying precedent is being set. It isn’t about missing billions in classic kickbacks or suitcases of cash. Instead, it’s about something far more abstract: the criminalization of advice.

The prosecution of Ibrahim Arief (Ibam) represents a watershed moment for the Indonesian legal system. By seeking to charge a 15-year prison sentence for a consultant, a penalty far harsher than those sought for the actual government officials involved, the Attorney General’s Office (AGO) has signaled that expertise is now a legal liability.

The myth of the corrupt Chromebook advice

The AGO argues that the Ministry of Education’s decision to procure Chromebooks was “wrong” and fraudulent because many regions lacked internet access. The prosecution partly blamed this on Ibam, who, as a consultant, advised that Chromebooks—along with Windows—could be used and that a device management solution is required to ensure admin control, which effectively makes Chromebooks a more competitive solution.

The prosecution’s narrative hinges on the idea that Ibam “orchestrated” the procurement of Chromebooks by “locking in” technical specifications. This framing conveniently ignores a fundamental structural reality: Ibrahim Arief was a consultant, not a government employee.

He held no executive power. While the prosecution contends that his name appeared in a procurement oversight decree (SK), Ibam’s team argued that this was done without his knowledge. In his role, he had no authority to draft final ministerial policies or to bypass state tender rules. He was brought in to discuss, analyze, and offer a technical perspective. In any functioning bureaucracy, the leap from “expert advice” to “state policy” requires several layers of official review and approval by career bureaucrats and elected leaders.

To hold a consultant criminally liable for a policy he didn’t write fundamentally misunderstands the nature of advisory roles. If a doctor recommends a treatment and the hospital’s management chooses to overspend on the equipment to provide it, you don’t arrest the doctor for “state loss.”

Furthermore, even if Ibam did vouch for Chromebooks only (red: he didn’t), and even if it ends up disastrous, it would still, by itself, not be classified as corruption in its traditional sense. A policy can be ambitious, premature, or even a failure, but under a fair legal system, corruption requires mens rea—actual criminal intent. The prosecution is attempting to redefine “inefficiency” as “corruption.” By this logic, any official who procures technology that eventually becomes obsolete, or isn’t fully utilized due to gaps in external infrastructure, could be labeled a criminal.

The legal trap: Articles 2 and 3 of the Corruption Law

This logical gymnastics is made possible by the current application of Articles 2 and 3 of the Anti-Corruption Law.

• Article 2, section 1 targets anyone who “unlawfully commits an act to enrich themselves, another person, or a corporation that may cause a loss to the state’s finances…”

• Article 3 targets anyone who, with the intention of benefiting themselves or others, “abuses the authority, opportunity, or means available to them because of their position or office…”

The “spirit” of these laws was originally intended to catch sophisticated embezzlers who are good at hiding their tracks. However, the modern interpretation has a major loophole: it doesn’t require the accused to be the one who benefited from the crime.

As long as the prosecution can argue that someone (a vendor, a corporation, or a third party) benefited, and that there was a “state loss,” the person who gave the advice or signed the paper can be held liable. In recent years, this has been weaponized to criminalize people for administrative errors or unpopular policy choices, even when there is zero evidence of a bribe.

We wrote about this previously and discussed it in greater detail.

The chilling effect on Indonesian expertise

The fallout of this case extends far beyond one individual. It sends a clear message to every tech founder, academic, and private-sector expert in Indonesia: Do not help the government.

For years, there has been a push to bring “top talent” into the public sector to help Indonesia leapfrog into the digital age. But why would any sane professional take that risk now? If your technical recommendations can be retroactively branded as “market manipulation,” and if your private assets can be targeted as “fines” for a project you didn’t even control, the rational choice is to stay away.

This creates a “fear of signing” and, worse, a “fear of advising.” We are creating a bureaucracy of “yes-men” in which no one dares to suggest a specific technology for fear it will be interpreted as a “vendor lock-in” by a prosecutor a decade later.

A call for a real anti-corruption drive

We call on the AGO to return to the actual intent of the law. Anti-corruption efforts should be about catching those who actually steal from the public purse or take bribes to influence policy or procurement outcomes, not about second-guessing technical consultations or targeting private citizens to secure a “big win.”

If there was real corruption in the Chromebook procurement—actual bribes, actual mark-ups for personal gain—the AGO should find them and prosecute the individuals who actually walked away with the money. But so far, this case looks like a desperate attempt to manufacture a narrative by targeting a high-profile name.

The alleged increase in Ibam’s wealth between 2020 and 2021 (which coincides with the Chromebook procurement period) has been clarified to be linked to Bukalapak stock, but the prosecution continued to misrepresent unrelated private wealth as illicit enrichment.

Indonesia cannot afford to lose its best minds to a legal system that treats innovation as a crime. The AGO must focus on real theft and stop the dangerous practice of criminalizing the act of giving expert advice.

The Indonesian Rupiah has been on a downward spiral in the past few months as geopolitical tensions continue to strain resources and create global instability. On May 7, it hit an all-time low of Rp 17,445 per US Dollar. Understandably, many of us are worried about an impending crisis, most especially as parallels are drawn with the periods leading up to the 1998 Asian Financial Crisis, when the Rupiah hit its previous all-time low of Rp 16,800 per US Dollar.

It is therefore not an exaggeration to say that everyone was surprised when Statistics Indonesia (BPS) released its latest record of Indonesia’s economic performance in the first quarter (Q1) of 2026, showing a 5.61 percent growth (y-on-y).

How does this make sense?

BPS data clearly indicate that the strong Q1 growth stems mainly from a rise in government expenditure, which grew 21 percent compared to Q1 of 2025. In a departure from the government’s usual habit of spending most of its state budget (APBN) allocation close to the end of the year, this time the government has front-loaded its spending much earlier.

It is quite important to note that economic performance in Q1 of 2025 was unusually weak as the government had just begun its efficiency drive, which then-Finance Minister Sri Mulyani had publicly acknowledged. It’s clearly had an effect in making this year’s Q1 performance look stronger in comparison.

Looking at the sectoral picture also complicates the celebration of the Q1 growth. Accommodation and food services recorded the highest growth at 13.14 percent, which makes sense given the timing of Eid holidays and higher household spending, while mining and quarrying suffered the deepest contraction at -8.20 percent, reflecting a much weaker picture in one of our core productive sectors.

In a nutshell, the growth is, by all means, real. But the story underneath the number is far more complicated than what meets the eye.

What deserves more attention

A 5.61 percent growth rate should, in theory, inspire confidence. When investors look at Indonesia, they’ll see momentum building up, bringing in fresh capital, and eventually the Rupiah will trend upward.

… Right?

Bank Indonesia (BI) has had to intervene heavily in domestic and offshore markets, while also tightening foreign exchange purchase rules to limit speculative demand. In recent weeks, foreign capital has indeed started to return, with BI reporting roughly Rp 57 trillion in foreign portfolio inflows into domestic financial markets by the end of April. But that rebound has not been enough to erase the palpable concerns shared by many.

The picture begins to blur again as we compare Rupiah with its regional peers. The Malaysian Ringgit, Thai Baht, and Singapore Dollar have all held up despite facing more or less similar pressure points. At this point, it’s difficult not to at least assume that there’s something else about Indonesia making investors uneasy.

Fiscal credibility remains the most obvious pain point. Indonesia’s APBN deficit in Q1 of 2026 reached Rp240.1 trillion (0.93 percent of GDP), a steep increase from Rp99.8 trillion (0.41 percent of GDP) in Q1 of 2025. Finance Minister Purbaya has framed this as part of a deliberate front-loading strategy—which may be true—but we’re not sure it’s a strategy that can be replicated and sustained.

Indonesia’s tax-to-GDP ratio also remains among the weakest in the region, falling to 9.31 percent in 2025, while government debt interest payments now consume 22 percent of APBN. With such a thin tax base and concerning budget deficit, it doesn’t help that the government seems to have no serious cost-benefit analysis to weigh the trade-offs it’s prepared to make. On top of that, the government’s Q1 primary balance hit Rp 95.8 trillion, which already surpassed the 2026 threshold of Rp 89.7 trillion.

If these facts don’t worry you, we want your secrets…

Half-hearted course correction

In late April, Deputy Finance Minister Juda Agung announced that the government had decided to discontinue the distribution of the ‘free’ nutritious meal (MBG) program on Saturdays. Saving approximately Rp 1 trillion for each Saturday removed, this decision is part of an effort to “refocus” government spending while continuing to deliver “existing priority programs with greater quality and precision,” according to Juda.

But MBG is far from the only source of concern. Last month, our editorial touched on the Rp 240-trillion gamble that is the Red-and-White Village Cooperative (KDMP) program, revealing that our fiscal risks increasingly fall outside the neat boundaries of the APBN. While the government can certainly argue that KDMP does not directly burden the APBN as its financing flows through state-owned banks (Himbara) and village funds, we doubt that anyone seriously believes the government will simply let Himbara absorb potential losses on its own.

Indonesia’s economy is increasingly steered through an increasingly convoluted network of flagship programs, state-owned banks, sovereign funds, village funds, energy compensation, and politically charged lending schemes. These may be defensible on their own terms, but collectively put the extent of the government’s fiscal accountability to question.

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What we need, ASAP

This is why Purbaya’s public communication mishaps matter more beyond social media memes.

While Sri Mulyani was perceived to be fiscally conservative, Purbaya is seen as more aggressive. Neither is better than the other, but we think it’s not too late to warn that managing APBN requires not only technical capacity, but also wisdom in communicating fiscal policies to the public to keep market confidence at a healthy level. Conversely, Purbaya has not showcased the same discipline. His tendency to shrug off concerns about the APBN deficit and to dismiss expert analyses may come across as attempts to stay calm when the situation calls for serious evaluation.

President Prabowo’s decision to nominate his nephew, Thomas Djiwandono, as BI Deputy Governor back in January seems to have exacerbated these concerns. While the appointment may be defensible procedurally, even the perception that monetary policy is politically exposed might have been enough to unsettle investors.

As a bare minimum, we reckon that a return to common-sense fiscal governance really isn’t too much to ask. It might not be too late yet, but only if the government takes firm action now.

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