Indonesian History

INDONESIA: Nationalism and Development in the 20th Century


Indonesia had been a Dutch colony since the early period of European colonial expansion. At the beginning of the 20th century the Dutch introduced the Ethical Policy, under which farming and limited health and educational services for Indonesians were developed. Railways, roads, and inter-island shipping were also expanded. The policy helped create two new social elements: a few Western-educated Indonesians and a smaller group of Indonesian entrepreneurs, who began to compete with a predominantly Chinese commercial class. The newly educated and somewhat prosperous Indonesians grew resentful of the colonial structure that denied them a role commensurate with their education and abilities.

The first important vehicle for the anti-Dutch nationalist movement was the Sarekat Islam (Islamic Union), established in 1912. Growing out of a protective association for batik merchants, the Sarekat Islam by 1918 claimed a membership of more than 2 million people throughout the archipelago. The Dutch were initially conciliatory toward Sarekat Islam, and in 1916 they established the Volksraad (People’s Council). In the Volksraad, selected representatives of major population groups could deliberate and offer advice to the government. After World War I (1914-1918), however, and especially after an abortive Communist-led insurrection in 1926 and 1927, the Dutch government adopted a more repressive policy.

In the 1920s the Indonesian nationalist movement was headed by leaders who were not primarily Muslim, notably Sukarno, an advocate of complete independence who founded the Indonesian Nationalist Party (Partai Nasional Indonesia, or PNI) in 1927. Despite the Dutch arrests and exiles of Sukarno (1929-1931, 1933-1942), Muhammad Hatta (1934-1942), and other nationalist leaders and the banning of the PNI and other noncooperating parties, the nationalist movement maintained its momentum. Only after Germany overran the Netherlands during World War II (1939-1945), however, did the Dutch even hint at a postwar transfer of political authority.

The Japanese Occupation

In 1942 the Japanese invaded and occupied Indonesia. Anxious to mobilize Indonesian support behind their regime, the Japanese gave Sukarno and his associates symbolic political freedom. The Japanese regime was repressive, however, because they had strategic concerns about Indonesian resources, particularly petroleum, and because they feared Allied counterattacks. They forced tens of thousands of people into conscripted labor and many did not survive.

In September 1943 the Japanese established militias in Java, Bali, and Sumatra, giving thousands of young men military training and forming the nucleus of the postwar independence army. In October 1944, in order to muster support against anticipated Allied attacks, the Japanese promised eventual Indonesian independence and subsequently offered limited self-government. Throughout most of the occupation, however, Japan’s harsh behavior and the growing economic hardships alienated Indonesians.

The Postwar Struggle for Independence


On August 17, 1945, two days after Japan surrendered to the Allies, Sukarno and Hatta declared an independent Republic of Indonesia and were selected as its president and vice president. By the time British troops landed on the islands in late September, a functioning republican administration was already established in many parts of Java and Sumatra. The British withdrew in November 1946 and persuaded the Dutch and the young republic to sign the Linggajati Agreement, which recognized the authority of the republic in Java and Sumatra and specified plans for a federal Indonesia.

In July 1947, however, the Dutch launched attacks, claiming that Indonesians had violated the agreement. The attacks extended Dutch control to about two-thirds of Java and to many of the large estates and oil fields on Sumatra. Several members of the UN protested the Dutch attacks, prompting the creation of a UN Good Offices Commission. The commission oversaw the signing of the Renville Agreement between the two sides in 1948. The agreement recognized Dutch control of the areas it had taken in 1947 but promised those areas a vote to determine their future. Meanwhile, the Dutch had blockaded the republican territory, inflicting intense economic hardship and building support among Indonesians for fighting the Dutch instead of negotiating with them. The popular sentiment was one cause for a failed Communist-led uprising in September 1948 at Madiun against the republic’s leadership.

In December 1948 the Dutch defied a UN cease-fire and again attacked the republic. The republic’s capital, Yogyakarta, was captured and most of its top leaders, including Sukarno and Hatta, were arrested and exiled. The Dutch were initially successful, but guerrilla resistance and pressure from the international community gradually motivated the Dutch to accommodate the Indonesians. In 1949 at a conference in The Hague, the Netherlands agreed to transfer sovereignty over all of Indonesia, except West Irian (now Irian Jaya), to the federal Republic of the United States of Indonesia (RUSI) by the end of that year.

The Sukarno Regime

In August 1950 the Unitary State of Indonesia replaced the RUSI. The government’s first task was to create a viable state from Indonesia’s many people and cultures; but it also had to quell sporadic uprisings of Muslim groups in West Java and Aceh as well as Dutch-led antirepublican movements in Sulawesi and the Moluccas. The nationwide elections of late 1955 gave none of parliament’s parties a majority, and only one party, the Masjumi, had a significant following outside Java. Both before and after the elections the government was criticized for being factional, corrupt, ineffective, and for maintaining few ties to the regions it was supposed to represent.

In 1956 President Sukarno called for reforming the party system and replacing liberal democracy with what he called "Guided Democracy," which would give the president wider government authority. It took Sukarno three years to implement Guided Democracy. In the meantime, the outer islanders grew increasingly resentful of the central government. They were especially upset over the small funding they received for economic development, despite contributing a large share of Indonesia’s export earnings. These and other factors prompted military coups on Sumatra and Sulawesi from December 1956 to March 1957, all of which were eventually put down. On February 15, 1958, army dissidents in Sumatra, supported by counterparts in Sulawesi and by several leaders of Masjumi, proclaimed the Revolutionary Government of the Republic of Indonesia. The rebels received covert aid from the United States and Taiwan but the forces of the central government soon defeated them. Guerrilla actions continued, however, until 1961.

In 1959, with his Guided Democracy in place, Sukarno pursued an active foreign policy. He demanded the Netherlands surrender West Irian (which, following a brief period of UN administration, was finally turned over to Indonesia in 1963), and he opposed the formation of the Federation of Malaysia. Domestically, the economic decline continued and both the army and the Communists (Partai Komunis Indonesia, or PKI) increased their power, with tension growing between the two groups.

Suharto’s Rise to Power

The situation culminated in a coup attempt on September 30, 1965. Led by Lieutenant Colonel Untung of the palace guard, the usurpers brutally murdered six top generals before being suppressed by General Suharto, head of the army’s strategic command. Suharto took control of the army and increasingly the state; he eased Sukarno out of effective power by March 1966. Although the identity and motives of the coup’s instigators remain controversial, the army alleged the Communist PKI was responsible. In response, army units and many Muslim groups, particularly in the countryside, began massacring Communists and their supporters in late 1965. Between 300,000 to 1 million people were killed in the Communist crackdown. The PKI, essentially erased in the executions, was banned on March 13, 1966. The government also arrested hundreds of thousands of people accused of involvement in the coup attempt. The last of these prisoners have yet to be released and there have been periodic executions, most recently in 1990. Of those arrested, only about 800 received a trial.

The New Order


Suharto instituted a "New Order" (Orde Baru) regime, which espoused a largely pro-Western policy. Indonesia ended confrontation with Malaysia and became a major promoter and participant in the Association of Southeast Asian Nations (ASEAN), which was founded in 1967. Suharto was officially inaugurated president in 1968. Elections were held in 1971, but they were tightly controlled by the government. The government-backed Golkar party secured most of the seats in the House of Representatives, as it would in each of the elections held at five-year intervals thereafter. Similarly, the People’s Consultative Assembly routinely returned Suharto to the presidency, unopposed, at five-year intervals.

In 1975 the state-owned oil enterprise, Pertamina, was unable to meet debt repayments amounting to $10.5 billion, and the crisis threatened Indonesia’s financial structure. Only by canceling projects, renegotiating loans, and receiving help from the United States and other Western governments did Indonesia salvage the situation. The rise in world oil prices helped Indonesia’s economic recovery. When oil prices stagnated in the early 1980s, Suharto shifted economic policy away from a reliance on oil exports. As part of the changes, he introduced greater openness (keterbukaan), promoting foreign investment in Indonesia and greater integration of Indonesia into the world economy. He also introduced reforms across a wide range of sectors to cut production costs and improve the competitiveness of Indonesia’s commodity exports. Although this policy has brought about solid economic growth, the reforms have not reversed the nation’s growing economic and social inequalities, particularly among the rural Javanese. By the mid-1990s a large slice of Indonesia’s wealth was concentrated in the hands of the president’s family and their associates. The economic inequalities have been exacerbated by the growth of the population, despite a relatively successful family-planning program in Java. Largely as a result, rioting has occurred in several Indonesian towns in the 1990s.

Several parts of Indonesia have also faced severe political instability since the 1970s. In 1975 Portugal withdrew from its colony of East Timor, located in the southeastern part of the Indonesian archipelago. The Frente Revolucionária do Timor Leste Independente (Fretilin), a leftist group that had sought independence, was left in control of the capital, Dili, and promptly declared independence. Indonesia responded by invading East Timor in December. Portugal and the UN condemned Indonesia’s invasion, but Indonesia later annexed the area as its 24th province. Human rights groups claim the Indonesian army may have killed more than 100,000 people during the annexation. In 1991 Indonesian soldiers massacred pro-independence demonstrators in Dili, provoking international condemnation. In 1996 Bishop Carlos Ximenes Belo and Jose Ramos Horta, two Timorese dissidents, were awarded the Nobel Peace Prize for their efforts to resolve the conflict. Fighting between Indonesian troops and Fretilin members continued into the mid-1990s despite talks between Indonesian officials and exiled Timorese leaders.

Independence groups also remain active in other parts of Indonesia, including the Free Papua Movement in Irian Jaya and the National Liberation Front Aceh Sumatra in Aceh on Sumatra’s northern tip. Most of Suharto’s opponents have come from Muslim groups that have never accepted government control and from university students alienated by the government’s corruption and human rights violations. In early 1978 students undertook widespread demonstrations, prompting the government to restrict activity on college campuses and press freedoms. In the early 1990s many dissidents gave their support to Megawati Sukarnoputri, the daughter of the late Sukarno. When she was deposed as chair of the Indonesian Democratic Party in mid-1996, protesters rioted in Jakarta. Although Sukarnoputri does not have the support of a large part of the population, she is the first figure in many years to pose a challenge to the incumbent president.


Contributed By:

Dean K. Forbes