Indonesia should not overestimate the indispensability of its waterways
Trystanto Sanjaya 7/14/26
Iran’s plan to introduce fees for ships passing through the Strait of Hormuz has inspired Indonesian policymakers to jest, and others to seriously suggest, that the country was contemplating similar measures for the Strait of Malacca and its archipelagic sea lanes. Across both facetious and real assertions, the Strait of Malacca has been popularly equated with the Strait of Hormuz — a misleading assertion that overstates the indispensability of Indonesia’s surrounding waters.
There is no question that both straits are vital bottlenecks in international trade. Ships carrying oil and natural gas from the resource-rich countries of the Middle East must pass through the Strait of Hormuz. Similarly, ships carrying goods, oil and gas transit the Strait of Malacca and Indonesia’s archipelagic sea lanes to expeditiously reach their suppliers and consumers across Europe, Africa and South Asia.
But there are key differences that make fees in the Strait of Hormuz a much more unnerving prospective than any hypothetical fees Indonesia could impose in the Strait of Malacca. The Persian Gulf is surrounded by land, and several Gulf states rely on the Strait of Hormuz for maritime transit, making Iran’s leverage over the Strait absolute. Though Oman controls half of the Strait, Iran is still willing and capable to exert its control over the Omani half, forcing risk-averse ships to avoid sailing through the strait entirely.
The Strait of Malacca and Indonesia’s archipelagic sea lanes are the most expeditious routes for ships to sail between the Indian Ocean and the South China Sea, but this does not carry nearly as much gravity as being the only maritime gateway, as is the case for the Strait of Hormuz. There are several alternative routes connecting the Indian Ocean and the South China Sea, such as sailing east through the Timor Gap and along the southern coast of Papua New Guinea before turning north to the Pacific Ocean.
This casts doubt on the rosy assumptions of some Indonesian policymakers. Those negatively affected by the weaponisation of chokepoints typically find ways to lessen their dependence and circumvent such restrictions. Should Indonesia impose fees on ships transiting the Strait of Malacca and its waters, most ships would simply take the longer route around Papua New Guinea, especially if the fees exceed the cost of purchasing extra fuel and extending transit times to undertake such an alternative route. Though vessels would still be able to pass through the region, there will be negative consequences for the global supply chain.
Any such policy would motivate the countries most affected — namely Vietnam, China, South Korea, Japan and Taiwan — to support and finance alternative transport infrastructure. This could include reviving Thailand’s Kra Canal ambition or significantly expanding its Kra Land Bridge project to partially bypass the Strait of Malacca and Indonesia’s archipelagic sea lanes, potentially eroding Indonesia’s strategic geographic relevance.
The geopolitical effects of imposing fees would do Indonesia more harm than good. When Jakarta announced the Djuanda Declaration in 1957, asserting that the waters between Indonesia’s islands belong to Indonesia, the country faced considerable opposition from the Soviet Union, the United States and other major maritime countries, who argued that the Declaration violated international law by impeding their freedom of navigation. If Jakarta tried to impose fees today, it would likely encounter similar opposition from China and the United States.
China and the United States both support freedom of navigation and innocent passage in territorial waters, at least for their own ships — rights that are vital for China’s export-reliant economy and for the United States’ military deployments. Given Indonesia’s economic dependence on China and military cooperation with the United States, it is difficult to envisage how Jakarta could withstand such pressure and insist on its fee policy.
As a pivotal contributor to the United Nations Convention on the Law of the Sea, Indonesia helped institutionalise a maritime order that balances sovereignty and freedom of navigation. The convention helped concretise Indonesia’s ‘archipelagic state’ doctrine, which became the backbone of its conceptualisation as a holistic ‘unitary state’. It gave Indonesia the freedom to run logistics between its different islands, which allowed its economy and infrastructure to develop. Undermining the convention and imposing maritime fees would weaken the very legal principles upon which Indonesia fundamentally relies. In short, Indonesia cannot have its cake and eat it too.
Trystanto Sanjayais Visiting Fellow at the Norwegian Institute of International Affairs.
The views expressed in this article are the author’s own.