VidBodh · Current affairs

The monthly magazine, July 2026 · Global Affairs and International Relations › Southeast Asia and Act East

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India and Indonesia: Act East across the Andaman Sea

LeadPrelims and MainsJuly 2026

Why in news

The Prime Minister made a state visit to Indonesia from 6 to 8 July 2026, his first bilateral visit since the two became Comprehensive Strategic Partners in 2018. The two sides reached agreements in principle on Indian missiles, renewed their maritime security pact, and agreed to develop Sabang port.

Background

Indonesia is India's maritime neighbour: Sabang, at the tip of Sumatra, lies about 90 nautical miles from the Andaman and Nicobar Islands, at the western mouth of the Malacca Strait.
It is the largest economy of ASEAN and joined BRICS in 2025, so it sits in two of India's main groupings.
It guards a tradition of non alignment, as India does, which shapes how far either will go in security ties.

The Act East policy, announced in 2014, made Southeast Asia the link between India's neighbourhood and the wider Indo Pacific.

What was agreed

Defence exports: agreements in principle for a further battery of the BrahMos cruise missile and the Astra air to air missile. With the Philippines (2022) and Vietnam (2026), this makes a Southeast Asian market for Indian missiles.
Maritime security: the pact renewed, and an Indonesian liaison officer at the Information Fusion Centre in Gurugram.
Sabang: to be developed for cruise tourism, ship repair and offshore energy, with financing to be settled on a timetable.
Minerals and payments: rare earths cooperation, a stainless steel venture, local currency settlement and a cross border Quick Response (QR) payment link.
Culture: conservation at the Prambanan temple and a Tagore and Dewantara year for the centenary of Tagore's 1927 visit.

A map of the Andaman Sea showing the Andaman and Nicobar Islands, Sabang and the Malacca Strait, with the five strands agreed in July 2026.Source: Ministry of External Affairs; The Hindu

India's stakes

Watching the Malacca approaches, through which much of China's trade passes, from both sides.
A market for defence goods, which India wants to grow to become an exporter.
A partner in ASEAN that can keep the grouping's review of the India trade agreement moving; India's deficit with ASEAN has grown.
A fellow member of BRICS that backed India's chairship in 2026.

The difficulty

Sabang has been discussed since 2018 without money. Indonesia does not want a project read as a base against China.
Trade talks under the ASEAN agreement have dragged on.
Missile sales depend on contracts yet to be signed.

The way forward

Finance Sabang through a joint venture with commercial uses first, so that it is not seen as military.
Sign the missile contracts and set up servicing in Indonesia.
Finish the review of the ASEAN trade agreement, since the deficit erodes support for Act East at home.

Prelims facts

Sabang is at the northern tip of Sumatra, near the Andaman and Nicobar Islands.
Indonesia joined BRICS in 2025 and is the largest economy in ASEAN.
2026 is the ASEAN and India Year of Maritime Cooperation.
Indonesia's Biak ground station supports the Gaganyaan mission.
The Bintang Adipurna is Indonesia's highest honour.

Places in news

Sabang · Indonesia · at the northern tip of Sumatra, at the western mouth of the Malacca Strait, about 90 nautical miles from the Andaman and Nicobar Islands7 Jul 2026: India and Indonesia agreed to develop Sabang port for cruise tourism, ship repair and offshore energy during the Prime Minister's state visit.
Strait of Malacca (Malacca Strait) · between Malaysia and Sumatra (Indonesia) · the narrow sea lane joining the Andaman Sea to the South China Sea7 Jul 2026: The India and Indonesia lead names watching the Malacca approaches, through which much of China's trade passes, as a shared stake.
Prambanan temple · Indonesia · in central Java, near Yogyakarta7 Jul 2026: India agreed to conservation work at the Prambanan temple during the state visit to Indonesia.
Biak · Indonesia · an island in Cenderawasih Bay off the north coast of Papua, facing the Pacific7 Jul 2026: Indonesia's ground station at Biak supports India's Gaganyaan mission, a Prelims fact of the India and Indonesia lead.