INDONESIA’S ECONOMIC AND POLITICAL IMPACT OF PARTICIPATION IN THE 2026 BRICS SUMMIT IN NEW DELHI
(Macro–Micro Economic Effects, Short-, Medium-, and Long-Term Implications, and Indonesia’s Future Geopolitical Position)
INDONESIA’S ECONOMIC AND POLITICAL IMPACT OF PARTICIPATION IN THE 2026 BRICS SUMMIT IN NEW DELHI
(Macro–Micro Economic Effects, Short-, Medium-, and Long-Term Implications, and Indonesia’s Future Geopolitical Position)
Author : R. Try Noegroho
POINT Consultant
September, 2026
KEDIRI
POINT Consultant
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Resmi menjadi anggota penuh BRICS di tahun 2025, Indonesia kini berdiri di antara negara-negara kekuatan ekonomi besar dunia. Namun, seberapa besar potensi dan manfaat konkret yang bisa didapatkan Indonesia dari keanggotaan ini? Apakah BRICS benar-benar bisa memperkuat ketahanan pangan dan energi nasional, mendorong local currency transaction (dedolarisasi), serta meningkatkan posisi tawar (bargaining position) Indonesia di kancah global? Ataukah forum ini berisiko hanya menjadi seremonial belaka jika tanpa strategi konkrit? Pada episode ke-56 Podcast What's on Economy kali ini, kami hadirkan Ahmad Heri Firdaus (Peneliti Center of Industry, Trade, and Investment INDEF) untuk membahas bagaimana Indonesia dapat memanfaatkan keanggotaan BRICS secara lebih konkret di tengah ketidakpastian ekonomi global. Poin kunci: Mengapa BRICS penting bagi posisi ekonomi dan daya tawar Indonesia? Mengapa BRICS penting bagi posisi ekonomi dan daya tawar Indonesia? Seberapa realistis penggunaan local currency dan pembentukan mata uang bersama BRICS? Apa yang harus dilakukan agar BRICS tidak berhenti pada kerja sama yang bersifat seremonial? 🎥 Tonton hingga akhir sekarang juga untuk tahu bagaimana Indonesia dapat memanfaatkan keanggotaan BRICS secara lebih konkret, memperkuat posisi tawar, serta mengubah besarnya potensi pasar dan kerja sama BRICS menjadi manfaat nyata bagi ekonomi dan kesejahteraan masyarakat Indonesia. Dukung terus konten INDEF dengan LIKE, SHARE, dan SUBSCRIBE agar tidak ketinggalan pembahasan isu ekonomi dan kebijakan terkini. 📌 Instagram: @indef_official 🌐 Website: www.indef.or.id
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Abstract
Indonesia's participation in the 18th BRICS Summit in New Delhi on 12–13 September 2026 represents an important development in the country's economic diplomacy and international positioning. President Prabowo Subianto attended the summit, where BRICS members adopted the New Delhi Declaration and discussed resilience, innovation, cooperation, sustainability, global governance reform, food and energy security, industrialisation, and the interests of the Global South.
This article examines the potential consequences of Indonesia's BRICS engagement at macro and microeconomic levels, while distinguishing immediate, medium-term and long-term effects. It also examines domestic political implications, relations with major powers, trade and investment opportunities, financial-system diversification, industrial policy, and Indonesia's position in the evolving international order.
The economic effects should not be interpreted as automatic gains from BRICS membership. They depend substantially on Indonesia's ability to convert diplomatic commitments into trade, investment, technology transfer, industrial capacity, financing, and productivity improvements.
1. Introduction
The international economic environment in 2026 is characterised by geopolitical conflict, fragmented trade relations, uncertainty surrounding monetary policy, supply-chain restructuring and competition over strategic resources.
Against this background, Indonesia's participation in BRICS has significance beyond diplomatic symbolism.
Indonesia is simultaneously:
- the largest economy in Southeast Asia;
- a major producer of commodities and strategic minerals;
- a large consumer market;
- an important manufacturing and downstream-processing base;
- an ASEAN member;
- a member of the G20;
- and, since 2025, a full BRICS member.
The 2026 New Delhi Summit therefore provides Indonesia with another multilateral platform through which it can pursue economic and diplomatic interests.
Indonesia's government has stated that its BRICS engagement is intended to strengthen cooperation with member and partner countries while supporting inclusive and sustainable growth. The Foreign Ministry also reported that Indonesia promoted joint industrialisation, food and energy independence, and greater representation for the Global South in global governance.
2. Indonesia's Economic Position Before Assessing BRICS Effects
Any assessment of BRICS should begin with Indonesia's domestic economic fundamentals.
According to Statistics Indonesia (BPS), Indonesia's economy grew 5.61% year-on-year in Q1 2026. GDP at current prices reached approximately Rp6,187.2 trillion in that quarter.
Growth subsequently moderated to 5.29% year-on-year in Q2 2026. Bank Indonesia reported that fiscal stimulus contributed significantly through government consumption and investment, while household consumption remained relatively resilient.
Bank Indonesia's August 2026 assessment projected full-year 2026 economic growth in the range of 4.9–5.7%.
At the external-sector level, Indonesia recorded a cumulative trade surplus of approximately US$3.58 billion during January–June 2026, while foreign portfolio investment recorded net inflows of US$1.8 billion in Q3 through 14 August. Foreign-exchange reserves stood at approximately US$145.3 billion at the end of July 2026.
These figures indicate that BRICS participation occurs from a position in which Indonesia already has substantial economic capacity, rather than as a substitute for domestic economic reform.
3. What Indonesia Can Obtain from BRICS
The most important potential benefits are not necessarily immediate increases in GDP.
They can instead arise through several channels:
a. Trade diversification
Indonesia can potentially expand trade with BRICS economies and reduce excessive dependence on individual markets.
b. Investment
BRICS countries can become additional sources of investment in:
- infrastructure;
- energy;
- minerals;
- manufacturing;
- food processing;
- digital technology;
- transportation;
- healthcare;
- pharmaceuticals.
c. Industrialisation
Indonesia can use BRICS cooperation to promote downstream processing and domestic value-added production.
d. Financial cooperation
BRICS discussions include greater use of local currencies and mechanisms intended to reduce vulnerability to international financial fragmentation. Reuters reported that the New Delhi communiqué included initiatives concerning local-currency trade and interoperability of central-bank digital currencies.
e. Technology
Potential cooperation includes:
- artificial intelligence;
- digital infrastructure;
- biotechnology;
- renewable energy;
- electric vehicles;
- advanced manufacturing;
- satellite technology;
- agricultural technology.
4. Macro-Economic Impact
4.1 GDP Growth
BRICS participation can support GDP growth indirectly through:
Investment → production → employment → income → consumption → tax revenue.
However, membership itself does not guarantee higher GDP.
The decisive factor is whether agreements concluded through BRICS produce actual projects.
A hypothetical investment agreement, for example, has considerably less economic significance than an investment that results in:
- a factory being constructed;
- Indonesian workers being employed;
- local suppliers being integrated;
- exports increasing;
- technology being transferred.
This distinction is critical when measuring the economic consequences of BRICS.
5. Trade Impact
BRICS provides Indonesia with access to a very large economic grouping.
Reuters notes that the expanded BRICS grouping represents more than 40% of the world's population and roughly a quarter of global GDP.
For Indonesia, the potential trade agenda includes:
- palm oil;
- nickel;
- copper;
- tin;
- coal;
- natural gas;
- agricultural products;
- fisheries;
- processed food;
- textiles;
- automotive products;
- pharmaceuticals;
- electronics;
- digital services.
The strategic objective should be to move from:
commodity exports → processed commodities → manufactured products → technology-intensive exports.
This would make BRICS participation more relevant to Indonesia's industrialisation strategy.
6. Micro-Economic Impact
The most important question for ordinary Indonesians is not simply:
"How large is BRICS ?"
The more relevant question is:
How does BRICS affect Indonesian households, workers, farmers, fishermen and MSMEs ?
6.1 MSMEs
Small and medium enterprises could benefit through:
- expanded export markets;
- digital commerce;
- supply-chain integration;
- financing;
- logistics;
- tourism;
- halal products;
- food processing.
However, MSMEs could also face stronger competition from imported products.
Therefore, trade liberalisation needs to be accompanied by:
- productivity improvement;
- certification;
- financing;
- digitalisation;
- quality control;
- export assistance.
7. Employment
BRICS-related investment could generate employment in:
- mining;
- mineral processing;
- manufacturing;
logistics;
- construction;
- renewable energy;
- agriculture;
- technology;
- tourism.
But the quality of employment matters.
Indonesia should seek high-productivity employment, not merely large numbers of low-wage jobs.
Investment agreements should therefore address:
- Indonesian labour absorption;
- vocational training;
- technology transfer;
- local procurement;
- research and development;
- managerial development.
8. Food Security
Food security is one of the areas highlighted by Indonesia during the BRICS Summit.
The Indonesian government has promoted cooperation concerning food and energy independence and Indonesia's potential contribution to global food security.
BRICS cooperation could support:
- agricultural technology;
- irrigation;
- fertiliser supply;
- seed technology;
- cold chains;
- agricultural machinery;
- food-processing industries;
- storage systems.
The long-term objective should be:
Food security → food sovereignty → competitive food exports.
9. Energy Security
Indonesia faces a dual challenge:
a. maintaining affordable energy for households and industry;
b. transitioning toward a lower-carbon energy system.
BRICS cooperation could potentially expand cooperation in:
- oil and gas;
- renewable energy;
- nuclear technology;
- geothermal energy;
- solar power;
- battery technology;
- electric vehicles;
- critical minerals.
Indonesia's nickel resources give it particular relevance to the global EV supply chain.
The policy challenge is ensuring that mineral resources generate domestic value rather than merely becoming another form of raw-material dependence.
10. Financial and Monetary Implications
One of the most strategically important areas is international payment infrastructure.
The New Delhi discussions included greater use of local currencies and financial interoperability.
For Indonesia, greater local-currency settlement could potentially reduce certain transaction costs and foreign-exchange risks in bilateral trade.
However, this does not mean that the US dollar will immediately disappear from international trade.
The more realistic approach is:
- Diversification rather than replacement.
- Indonesia can maintain access to the dollar-based global financial system while expanding settlement options with BRICS partners.
- This is consistent with a broader strategy of strengthening external resilience.
11. Short-Term Effects: 2026–2027
In the short term, the effects are likely to appear mainly through:
- Economic diplomacy
Indonesia can negotiate new trade and investment arrangements.
- Investor sentiment
Participation in BRICS can increase international visibility.
- Business networking
Indonesian companies can seek partnerships with businesses from BRICS countries.
- Export diversification
Businesses can explore alternative markets.
- Financial cooperation
Indonesia can participate in discussions concerning cross-border payment systems.
But the immediate macroeconomic impact should not be exaggerated.
A summit declaration does not automatically produce GDP growth.
12. Medium-Term Effects: 2027–2030
The medium-term period is more important.
If diplomatic commitments are converted into actual projects, Indonesia could experience:
- increased foreign direct investment;
- expanded manufacturing;
- mineral downstreaming;
- increased exports;
- technology transfer;
- new infrastructure;
- stronger logistics networks;
- greater employment.
The key performance indicators should include:
13. Long-Term Effects: 2030–2045
The long-term significance is connected to Indonesia's 2045 development objective.
BRICS could become one component of a wider Indonesian strategy involving:
ASEAN + G20 + BRICS + bilateral partnerships + Global South diplomacy.
Indonesia does not have to choose its international economic relationships exclusively through one bloc.
Instead, it can pursue diversified partnerships.
The strategic objective could be expressed as:
"Open to all, strategically dependent on none."
This approach would allow Indonesia to cooperate simultaneously with:
- China;
- India;
- Russia;
- Brazil;
- the United States;
- Japan;
- South Korea;
- the European Union;
- ASEAN;
- Australia;
- the Middle East.
14. Political Implications Inside Indonesia
Indonesia's participation in BRICS also has domestic political consequences.
Different groups may interpret BRICS participation differently.
Some may view it as:
- an expansion of Indonesia's strategic autonomy;
- greater Global South representation;
- an opportunity for economic diversification.
Others may raise concerns about:
- Indonesia's relationship with Western countries;
- geopolitical competition;
- dependence on major BRICS economies;
- transparency of investment agreements;
- strategic sectors and national security.
These different interpretations are part of normal democratic debate.
The government therefore needs transparent communication regarding the economic objectives and legal framework of BRICS cooperation.
15. Global Geopolitical Implications
The 2026 New Delhi Summit demonstrated both the opportunities and internal complexities of the expanded BRICS.
Reuters reported that the grouping includes Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Indonesia, Iran and the UAE, while the summit dealt with significant differences among members.
The summit also produced a joint declaration concerning global conflicts and international cooperation.
This means BRICS should not be understood as a perfectly unified political or economic bloc.
Its members have:
- different economic structures;
- different foreign policies;
- different security interests;
- different relationships with the United States;
- different relationships with China;
- different regional priorities.
Indonesia therefore has room to pursue its own national interests within the grouping.
16. Indonesia–India Relations
The New Delhi Summit also provides an important bilateral dimension.
India is simultaneously:
- a major BRICS member;
- a major emerging economy;
- an important Indonesian trade partner;
- a major population centre;
- an important technology and services economy.
The summit also coincided with renewed India-China engagement. Reuters reported that Indian Prime Minister Narendra Modi and Chinese President Xi Jinping discussed business, transportation, trade barriers and bilateral relations on the sidelines of the summit.
For Indonesia, improving relations among major Asian powers could create additional opportunities for regional trade and connectivity.
17. Indonesia–China Dimension
China remains particularly important because of its:
- enormous market;
- manufacturing capacity;
- infrastructure capabilities;
- technological ecosystem;
- role in global supply chains.
At the same time, Indonesia needs to ensure that economic cooperation does not create excessive dependence.
Therefore, Indonesian policy should prioritise:
investment + local production + technology transfer + Indonesian employment + export capacity.
The objective should not simply be importing capital or products.
18. Indonesia–United States and Western Relations
BRICS participation also needs to be understood within Indonesia's broader foreign policy.
- the United States;
- European markets;
- Japan;
- South Korea;
- Australia;
- ASEAN.
Therefore, Indonesia's diplomatic position can be described as multi-alignment and diversification, rather than necessarily choosing one exclusive geopolitical camp.
This is especially important for Indonesia's investment requirements.
19. Risks
BRICS participation also carries potential risks.
19.1 Geopolitical pressure
Indonesia may face pressure from competing major powers.
19.2 Trade imbalance
Increasing imports without equivalent export growth could weaken domestic industries.
19.3 Financial volatility
Changes in global monetary conditions can still affect the Rupiah and capital flows.
19.4 Technology dependence
Foreign investment can create dependency if technology transfer is limited.
19.5 Commodity dependence
Indonesia should avoid simply replacing one commodity market with another.
19.6 Domestic inequality
Investment benefits can become concentrated geographically or socially unless regional and MSME participation is deliberately strengthened.
20. Strategic Policy Recommendations
A comprehensive Indonesian BRICS strategy should contain at least 10 pillars:
1. Trade diversification
Expand Indonesian exports into BRICS markets.
2. Industrial downstreaming
Prioritise processed and manufactured products.
3. Technology transfer
Make technology cooperation part of major investment agreements.
4. MSME internationalisation
Create BRICS export programmes specifically for Indonesian MSMEs.
5. Food security
Develop joint agricultural technology and food-processing projects.
6. Energy security
Develop renewable energy and strategic energy partnerships.
7. Financial diversification
Expand local-currency settlement while maintaining financial-system stability.
8. Human-resource development
Establish BRICS scholarships, vocational programmes and research partnerships.
9. Infrastructure
Strengthen ports, railways, industrial estates and digital connectivity.
10. Good governance
Ensure transparency, competitive procurement, environmental safeguards and legal certainty.
21. A Possible Indonesia BRICS Economic Roadmap
2026–2027
Diplomatic and institutional consolidation
- identify priority markets;
- establish business councils;
- negotiate trade facilitation;
- identify strategic projects;
- strengthen local-currency settlement.
2027–2030
Industrial acceleration
- develop manufacturing projects;
- strengthen mineral downstreaming;
- integrate MSMEs;
Bank Indonesia and the Indonesian government have launched integrated programs to transform Micro, Small, and Medium Enterprises (MSMEs) through capacity building, digital tools, and unified databases.
Key Integration Initiatives :
* Bank Indonesia's Transformation Program: A national initiative focused on strengthening entrepreneurial skills before providing capital. It features a three-stage model: 2.5 months of training and certification, practical internships or sandboxing, and final business setup with capital access. Learn more via the Bank Indonesia News Release.
* SAPA UMKM Service System: An integrated service system backed by the Ministry of MSMEs to streamline business data and stakeholder synergy.
* Digital and Financial Integration: Platforms like BRIAPI Solutions for MSMEs connect digital financial services to help local businesses scale and manage reporting.
* Economic Foundation: Studies on MSMEs for Inclusive Growth in Indonesia show that integrating small businesses into broader supply chains drives more than 60 percent of national GDP.
- expand infrastructure;
- increase technology cooperation.
2030–2035
Global value-chain integration
Indonesia should move toward:
resource producer → industrial producer → technology-enabled exporter.
2035–2045
Global economic positioning
The long-term objective would be an Indonesia that is:
- industrially competitive;
- technologically capable;
- financially resilient;
- food and energy secure;
- export-oriented;
- integrated into multiple global economic networks.
22. BRICS and Indonesia's "Free and Active" Foreign Policy
Indonesia's constitutional foreign-policy tradition provides an important framework for understanding BRICS.
The principle of bebas dan aktif does not require Indonesia to isolate itself from major powers.
Instead, it provides space for Indonesia to participate in different international institutions while maintaining its own national interests.
Consequently, Indonesia can simultaneously participate in:
ASEAN — G20 — BRICS — APEC — UN — bilateral partnerships.
The challenge is coordination.
23. The Central Question: What Does Indonesia Actually Gain?
The ultimate measure of BRICS participation should not be the number of meetings attended.
It should be measured through tangible outcomes:
For the state:
- stronger economic resilience;
- greater diplomatic influence;
- diversified trade;
- improved investment flows.
For industry:
- new markets;
- technology;
- financing;
- supply-chain integration.
For workers:
- better employment;
- higher productivity;
- vocational opportunities.
For MSMEs:
- export opportunities;
- financing;
- digitalisation;
- international partnerships.
For households:
- purchasing power;
- employment;
stable food and energy prices.
24. Conclusion
Indonesia's participation in the BRICS Summit in New Delhi on 12–13 September 2026 represents an important component of Indonesia's expanding international economic diplomacy. President Prabowo's participation and Indonesia's stated priorities focused on resilience, industrialisation, food and energy security, cooperation and stronger representation of the Global South.
The economic impact, however, should be assessed realistically.
In the short term, the principal effects are diplomatic, commercial and investment-related.
In the medium term, the important question is whether BRICS cooperation produces factories, infrastructure, technology transfer, exports and employment.
In the long term, BRICS could become one component of Indonesia's broader strategy for economic diversification and strategic autonomy toward 2045.
Indonesia's domestic economy enters this period with relatively strong fundamentals: Q1 2026 growth of 5.61%, Q2 growth of 5.29%, substantial foreign-exchange reserves, and continued policy coordination between the government and Bank Indonesia
At the same time, global growth remains relatively weak and geopolitical risks remain significant. Bank Indonesia projected global growth of around 3.0% in 2026 and continued elevated global inflation pressures.
Therefore, the central issue is not simply whether BRICS is good or bad for Indonesia. The more useful economic question is:
- How effectively can Indonesia transform BRICS participation into domestic productivity, industrialisation, technological capability, export diversification,
employment and improved welfare while preserving diversified relationships with the wider international economy ?
- That will determine the practical significance of Indonesia's BRICS membership far more than diplomatic symbolism alone.
Key Words
Indonesia, BRICS, New Delhi Summit
Indonesia, BRICS, New Delhi Summit 2026, Prabowo Subianto, Global South, Indonesian Economy, Economic Diplomacy, Trade, Investment, Industrialisation, Geopolitics, MSMEs, Energy Security, Food Security, Local Currency, Digital Economy, Strategic Autonomy, Indonesia 2045.
Selected References :
- Bank Indonesia, Monetary Policy Review August 2026.
- BPS-Statistics Indonesia, Indonesia's Economic Growth in Q1-2026 was 5.61 Percent.
- Ministry of Foreign Affairs of the Republic of Indonesia, Indonesia Promotes BRICS Cooperation in Strengthening Industrialisation and Developing Countries' Self-Reliance, 15 September 2026.
- Office of the President of the Republic of Indonesia, reports on President Prabowo's participation in the BRICS Summit 2026.
- Reuters, reporting on the evolution, economic weight and internal challenges of BRICS.
- Reuters, reporting on the New Delhi BRICS Declaration and discussions
among member states.
- Reuters, reporting on India-China economic and diplomatic developments surrounding the New Delhi Summit.
By, POINT Consultant (R Try Priyo Nugroho)
Kediri , September 2026
