New year, new me? Navigating Indonesia in 2026
Five things The Reformist will keep an eye on this year
After more than a year in power, President Prabowo Subianto and his current administration enter 2026 carrying unanswered problems of the past while attempting to meet ambitious goals of the future.
In 2025, the government underwent sweeping austerity measures, establishing the country’s sovereign wealth fund, and introduced grand flagship programs; all with the stated goal of laying the foundation for an 8-percent economic growth. However, last year also saw creeping militarization in civic space, opaque lawmaking processes, and blatant abuse of law enforcement powers.
If 2025 was the year of grand introductions, then 2026 will be one of setting precedent and patterns of what is to be expected of this administration in the foreseeable future.
This edition of The Reformist will preview the year ahead as President Prabowo begins his second year in office amid growing concerns of democratic backsliding, lackluster policy management, and escalating geopolitical turmoil—with extra attention on these five issues:
1. What’s next for Prabowo’s ‘grand’ flagship programs
In Prabowo’s second year in office, all eyes will be on the flagship programs he promised during his election campaign; the most notable being the Free Nutritious Meal (Makan Bergizi Gratis, or ‘MBG’). Throughout 2025, the initiative was scrutinized for a variety of reasons, from its lack of oversight, cases of food poisoning, and the involvement of law enforcement in its implementation, which has raised conflict of interests criticisms.
This year, the ‘MBG’ program will drain Rp 335 trillion from the state budget to finance its operations, up from the Rp 71 trillion allocated in its inaugural year. Notably, only around 72 percent of the budget last year was spent, raising further questions on how a fivefold increase will be used, and more importantly, why it is needed for this program.
Prabowo’s 80-thousand Red and White Village Cooperatives (Koperasi Merah Putih) program was also reworked late last year to ramp up its operations going into 2026. Through Presidential Regulation No. 17/2025, the Finance Ministry redirected village funds (Dana Desa), sourced directly from the state budget, toward financing cooperative infrastructure through state-owned banks.
In total, up to Rp 240 trillion in village funds will be used to build warehouses, retail outlets, and supporting facilities, with local governments required to repay around Rp 40 trillion annually over six years. Each cooperative is eligible for a bank loan of up to Rp 3 billion, allocated for both physical construction and operational costs, while state-owned PT Agrinas Pangan, alongside the Indonesian military, has been tasked with accelerating construction to make up for limited technical capacity.
Lastly, food security (‘food estate’) will take center stage this year as the Prabowo administration pledged to expand agricultural production in land-rich Papua. Environmental groups warn that this approach risks accelerating deforestation and ecological collapse. Greenpeace estimated that up to 2.4 million hectares of natural forests, wetlands, and savannas could be affected.
As of October 2025, land clearing for these projects had already reached around 36 thousand hectares, with nearly 20 thousand hectares classified as deforestation. Human rights violations over the forced displacement of indigenous Papuans will also continue to rise as more land is cleared for this program.
2. Electoral politics and democratic backsliding: Welcome back, New Order?
Indirect local elections have made headlines early in the year as President Prabowo and his government coalition continue to spearhead the plan for governors, mayors, and regents to no longer be directly voted by the public but instead by the Regional House of Representatives (‘DPRD’).
According to Prabowo’s coalition, this move would substantially lower the cost of politics, allowing fairer competition in Indonesia’s democracy. They further contend that these local leaders, as part of the executive branch, function primarily as extensions of the central government.
These claims, however, are widely challenged as a superficial response to money politics while masking hidden intentions. By restricting voter choice of locally elected leaders, power becomes even more centralized as political party elites gain greater political ground to lobby amongst themselves on who gets to govern a region. This reality further distances citizens from the democratic process and politicians from accountability.
The current administration has now garnered support from all but two political parties in the House of Representatives (‘DPR’), namely coalition-mate Prosperous Justice Party (‘PKS’) and quasi-opposition Indonesian Democratic Party of Struggle (‘PDI-P’). However, as the President consolidates more of his power politically, this year might just be the moment he attempts to realize this ambition.
Additionally, while elites in the administration have only called for indirect elections at the local level, Prabowo and his Gerindra party have long advocated for the reinstatement of the original 1945 Constitution to replace the current amended Constitution, which among other things would erase direct presidential elections. This isn’t just hearsay, it is explicitly written in Article 10 of the party’s bylaws.
Under the original Constitution, direct presidential elections would cease to exist as the Consultative People’s Assembly (‘MPR’) would have the authority to select the country’s President, reverting the process to how it was done throughout the New Order regime.
The signs of democratic backsliding are there, and if left unchecked, Indonesia risks a return to authoritarianism.
3. Energy transition: Big ambition, but what of the execution?
Indonesia’s energy transition narrative continues to clash with policy reality. Last year in Brazil, President Prabowo publicly pledged that Indonesia would source 100 percent of its energy from renewable sources in the next ten years. In front of the United Nations’ General Assembly, he affirmed Indonesia’s commitment to Net Zero Emissions by 2060.
Domestically, he has also promised an ambitious goal of creating 100 gigawatts (GW) of solar energy capacity. While this promise is good on paper, a roadmap on how this will be done does not yet exist. At present, Indonesia has less than 1 GW of solar capacity in its energy mix.
The initiative will delegate 80 GW to be created through village cooperatives, whereas the other 20 GW will be managed by the central government. Without addressing concerns of scale, technical capacity, good governance, and proper financing models, this solar power dream risks becoming another one of the President’s grand yet lackluster ambitions.
Grand ambitions aside, the 2025–2034 Electricity Procurement Business Plan (RUPTL) is also set to schedule new coal-fired power plants, even though Presidential Regulation No. 112/2022 formally bans the construction of new coal facilities. Talks of revising this regulation to allow coal plants under the pretext of ‘energy sovereignty’ have led to public backlash as a step back towards meaningful decarbonization, especially since the current text already permits captive coal power plants for industrial use.
Meanwhile, Indonesia’s sovereign wealth fund, Danantara, has announced plans for geothermal and waste-to-energy power plants, whose “renewable” classifications are often challenged by experts and advocates. While these investments allow the government to signal progress on clean energy, they do little to dispel concerns that Indonesia’s transition strategy continues to rely on grey-area solutions rather than a decisive step towards investing in proven clean energy.
4. With a collapsing international order, where does Indonesia stand?
Last year was marked by further signs of a decaying rules-based international order. A multipolar world built on the foundations of international law and collaboration has been undermined in favor of arrogance from global powers. The United States, under President Donald Trump, resumed an aggressive unilateral foreign policy that included withdrawing from longstanding agreements and deepening skepticism about collective approaches to global challenges.
Geopolitical tensions continue to evolve, including deepening conflicts between China and Taiwan, border disputes and military aggression among ASEAN member states, and the lack of a real solution for Israel’s ongoing genocide in Palestine.
Indonesia, as a middle power, could stand as a key actor in this changing geopolitical structure—one shaped by the advocacy of international law. Yet, while President Prabowo publicly boasts a ‘free and active’ foreign policy motto, Indonesia’s current diplomatic model appears pragmatic at best and unprincipled at worst. These stand in stark contrast as Indonesia assumes the Presidency of the UN Human Rights Council for 2026.
Last year, President Prabowo showed this by applying for Indonesia’s membership into BRICS, while still finding ways to cozy up with US President Donald Trump. His administration also broke a decade-long deadlock by securing an economic partnership agreement with the European Union, even as it pursued deeper security and defense cooperation with countries like Türkiye and China.
Entering 2026, this unprincipled approach sees no signs of slowing down. On 3 January, after the US launched a unilateral military attack on Venezuela, capturing President Nicolás Maduro and First Lady Cilia Flores into US captivity, foreign leaders across the Global South and middle powers were quick to condemn Washington’s actions. Indonesia, however, chose to remain neutral, with the Foreign Ministry expressing ‘grave concern’ without explicitly mentioning the US or Donald Trump as aggressors. President Prabowo himself has yet to issue an official statement on the incident.
This approach is far from accidental. With unfinished tariff negotiations between the US and Indonesia, explicitly condemning the US now goes against the trust the President is actively cultivating with his American counterpart.
Indonesia’s foreign policy has thus evolved into one that subordinates the enforcement of international law to the pursuit of narrowly defined national interests. Keeping up this balancing act, however, will only become more difficult as the world becomes more polarized under a dysfunctional international order.
5. Corruption eradication effort, politicized?
Debates over what constitutes corruption came into focus last year after a series of high-profile graft cases. From adulterated gasoline sold at inflated prices, ‘illegal’ sugar import policies, to the purchase of old naval fleets, corruption continues to dominate Indonesia’s news cycle.
In many of these cases, prosecutors centered their allegations on the notion of ‘state losses’, as stated in Articles 2 and 3 of Law No. 20/2001 on Anti–Corruption. The argument was used to justify indictment even in the absence of clear paper trails or evidence that the suspects benefited personally. (We wrote in-depth about the contested articles last year in this piece)
This was exactly what happened in the highly politicized graft case against former trade minister Tom Lembong. The trial almost ended with Tom being sent to prison for four and a half years, until President Prabowo intervened at the last minute to provide legal clemency to the former trade minister.
Utilizing anti-corruption law to criminalize policy and business decisions undermine the ultimate goal of addressing theft and large-scale embezzlement more detrimental to the economy.
Yet, the same ‘state losses’ argument continues to be used as former education minister Nadiem Makarim currently sits on trial for the Rp 2.1 trillion Google Chromebook procurement graft case. Nadiem and his legal team have rejected these claims, arguing that there was no personal enrichment. Google representatives have also denied involvement in any quid pro quo arrangements between the tech giant and the former minister.
While Nadiem’s tenure as education minister is viewed in a controversial light due to his ‘out of touch’ approach in reforming the country’s education system, the graft case itself reeks of foul play. In 2026, attention will remain on whether the Corruption Eradication Committee (KPK) and the Attorney General’s Office will tackle genuine corruption cases, or if they will continue getting dragged into high-profile, politicized cases.
Buckling up for 2026
This next year will not be easy or smooth sailing. As the current administration continues to push out new and controversial policies, it is important that civil society remains as a vanguard of political accountability to ruling elites.
Empathetic solutions exist if those in power choose to wield their political power in a just manner. Achieving policy continuation does not have to come at the cost of authoritarianism and nor does economic growth have to come at the expense of environmental degradation or human rights violations.
If you are interested in watching Indonesia’s 2026 under Prabowo’s second year in office with us, The Reformist is opening up more spots this year for our readers to contribute to our opinion column. Write to us: connect@thinkpolicy.id
Gloom and doom....for those striving for a more equitable and democratic future for Indonesia..