Iran, Indonesia: Commonalities, opportunities for cooperation

Indonesia as one of the main poles of the Association of the Southeast Asian Nations (ASEAN) experienced a six percent growth in gross domestic product (GDP) between 2008 and 2013 and is considered a newly-emerge economy with vast capacities for cooperating with other countries.

Iran also as one of the most notable Middle Eastern countries after the West lifted its unilateral sanctions is now in a path that Indonesia experienced in terms of growth in gross domestic product over past few years.

Iran’s conspicuous difference from Indonesia is in Iran’s access to vast energy resources, abundance of natural resources, population in proportion to paving the path of development and gaining access to it, having educated and skilled manpower as well as have varieties of climates which have created relative advantages for country.

The Iranian and Indonesian officials by knowing these capacities have increased their interactions since Indonesian President Joko Widodo took office concurrent with President Hassan Rouhani’s second year in office.

The visit by President Rouhani to Indonesia in May 2015 and the reciprocal visit by President Widodo to Iran in December 2016 as well as exchange of visits by the two countries’ other officials shows their political will to boost their interactions.

The capacities and advantages of the two countries will pave the way for broadening of cooperation in different sectors, including trade and energy, and this can eventually accelerate the pace of the two countries' developments.

The development of cooperation with Indonesia for importing Liquefied Petroleum Gas (LPG) from Iran, the first step of which was agreeing with the purchase of over 500,000 metric tons of gas from Iran as some shipments have been exported as well as Iran's commitment to conduct research on construction of an oil refinery in Eastern Java and a 5,000-megawatt in Indonesia are examples which further underline the need for mutual cooperation.

Iran's first LPG shipment arrived in Indonesia in October last year which was regarded the first step in supply gas to Indonesia by Iran.

Indonesia is presently producing 817,000 barrels of oil per day and imports exactly the same amount, but the estimates say that Indonesia will be able to produce only 550,000 barrles of oil per day by 2020.

The two sides' cooperation in operationalizing Ab Teymour and Mansouri oilfields in Iran can be considered as another positive step by the two strategic partners in the energy sector.

In spite of Iran-Indonesia cooperation in the energy sector which is needed by the two sides, their collaborations are not restricted to this field.

Some figures indicate that Iran's non-oil export to Indonesia surpassed $ 50 million in the first six months of the current Iranian year (March 20, 2016-September 20, 2016) showing a 40-percent growth as compared with the previous year's corredponding period.

Indonesia also exported different products such as palm oil, paper, coffee, tuna fish, auto parts and wood pulp for paper industry amounting to 117,800 tons.

The Indonesian ministers of economic affairs coordination and energy and mining resources will lead a 25-strong delegation to Tehran to negotiate with Iranian officials in the field of boosting mutual cooperation.

241**1611**2050
By Reza Peyman Yaqmayee, Translated by Hamid Shamlou