Dueling Islam: Middle Eastern Geopolitics Intrude in Southeast Asia
How the Saudi-Iranian rivalry is changing Indonesian democracy

For most of its post-colonial history, Indonesia has been regarded as a success story for moderate pluralistic Islam. The country is nearly 90% Muslim, yet over the 50 years following independence, it broadly managed to avoid the sectarianism and enforced religious orthodoxy found elsewhere in the Islamic world. In a trend that has gone underreported, however, this culture of tolerance is beginning to shift with theological and social implications for Indonesians and geopolitical consequences for the region.
The geopolitical rivalry between Saudi Arabia and Iran incorporates a deeply ideological component as the two states vie for theological influence across the Muslim world. While they rattle sabers and feed proxy conflicts with each other in the Middle East, further afield, the competition takes the form of investment in religious education and support for sympathetic Sunni or Shia leaders1. As the world’s largest Muslim-majority country, Indonesia is a power player in the Islamic world, even if it is not an ideological player the way Saudi Arabia and Iran are. Because of this, Indonesia has seen increasing investment from Saudi Arabia to cultivate religious academies and preachers of the hard-line Saudi Wahhabi school of Islam. In addition to investment within Indonesia, the kingdom offers scholarships for students to continue their religious training in Saudi Arabia. These investments, combined with the strategy of Suharto, Indonesia’s illiberal second president from 1967 to 1998, of suppressing political activism while leaving religion untouched, led to the channeling of popular energy from political to religious activism.
These investments are not new, having accelerated in the 80s as competition picked up following the Iranian revolution. Neither is the religious extremism they produce. Indonesia provided a fertile recruiting ground for Saudi-educated Mujaheddin fighters for Afghanistan during the Soviet invasion. However, it was during the early 2000s, following Indonesia’s transition to democracy and in the turbulent years of the War on Terror, that Wahhabism began to shift Indonesia’s domestic politics. As Michael Vatikiotis observes in Blood and Silk, Indonesian youth in the Javan city of Jogjakarta went from wearing jeans and long hair in the 1980s to T-shirts with pictures of Osama bin Laden in 2004, indicating a stark shift towards support for radical Islam.
While Indonesia’s political institutions are still designed to be secular and pluralistic, its politicians are increasingly catering to religious groups to win elections and retain power. This tilt towards Islamic populism is particularly felt by religious and ethnic minorities who are occasionally on the receiving end of mob violence, which is provided cover by sympathetic or opportunistic politicians. Political opportunism aside, Indonesia is also an inheritor of a long and vibrant strain of Islamic political philosophy, which sees the state as the custodian of Islam. This can be seen in the role of religion in Pancasila, Indonesia’s founding political philosophy. However, it also indicates that politics will likely continue to be influenced by the fatwas, or Islamic legal opinions, handed down by Islamic scholars. If those scholars are being cultivated by fundamentalist Saudi theology, then it stands to reason the state itself is likely to move in the same direction unless checked institutionally.
Ideologically, Iran is at a disadvantage in cultivating allies among Indonesia’s majority Sunni population, with some political and religious leaders going so far as to declare Shi'ism heresy. However, this hasn’t stopped Iran from creating religious academies and cultivating warm state-to-state relations with Indonesia. This is made clear by Iran’s backing of Indonesia for a permanent seat on the Security Council and Indonesia’s history of resisting US attempts to isolate Iran further.
The trend towards greater religiosity and less tolerance in Indonesia has implications domestically, regionally, and geopolitically.
Domestically, Indonesia is likely to continue its drift towards a greater role for Islam in its politics and society because Saudi investments continue, and politicians are all too happy to seize on populism as a political crutch. This will likely produce a reduced tolerance for pluralism within the Muslim majority. It remains to be seen how far this erosion will go and to what extent Indonesia’s still fragile democratic institutions can hold it back. How the country’s diverse communities will respond to the erosion of rights they have enjoyed since their post-colonial incorporation into Indonesia is also unclear. Fundamentalist Islam has already created numerous insurgencies across Southeast Asia in both Muslim majority and minority countries. However, if hard-line Islamic thought gains political control, it risks creating new insurgencies within minority communities struggling to retain their political rights and religious freedoms.
Islamic insurgency frequently spills across international borders while shifting from local concerns to a transnational agenda. Students radicalized by religious schools in Indonesia may provide recruits for insurgencies across the region, including those in Southern Thailand and the Philippines, in addition to terror attacks such as the one experienced in Malaysia on May 17th. Suppose regional players see their security threatened by radicalization happening in Indonesia. In that case, it will create another barrier to regional cooperation, with negative implications for the movement of people, goods, and capital.
Globally, Southeast Asia remains at the crossroads of geopolitical interest. From dueling colonial empires in the 19th century to the Cold War in the 20th and the Sino-American rivalry of the 21st, Southeast Asia has consistently been a theater of competition between great powers. Today, China and America are working hard to cultivate rival blocks in Southeast Asia despite many of those countries' insistence on pursuing a non-alignment strategy. In particular to the American observer, Indonesia’s place as the region’s largest democracy and its ongoing maritime disputes with China in the South China Sea makes it a natural ally. However, as Indonesia continues to buy weapons from Russia, trade with Iran, and welcome Wahhabi Islamic teaching, even while partnering with the US in other domains, it clearly sees its interests as converging with neither the US nor China.
Following its transition to democracy, Indonesia is regarded as a success story. It is the fourth largest country in the world—a pluralistic democracy, rich in natural resources, and possessed of a fast-growing economy. Indonesia is well-positioned to reorient the region to its interests and be a player on the international stage. However, Indonesia is also in the crosshairs of several foreign influences that do not serve its interests. With its eyes on avoiding entanglement in the Sino-American rivalry, it risks involvement in another geopolitical struggle within the Islamic world, which threatens not only its security and prosperity but also its identity as a pluralist and tolerant society.
For those interested in going deeper, you can find an excellent series of articles on Indonesia’s relationship with the Middle East at the Middle East Institute: “Indonesia and the Middle East: Exploring Connections,” Middle East Institute, January 1, 2022, https://www.mei.edu/publications/indonesia-and-middle-east-exploring-connections.