Indonesia (ĭn'dənē'zhə) , officially Republic of Indonesia, republic (2005 est. pop. 241,974,000), c.735,000 sq mi (1,903,650 sq km), SE Asia, in the Malay Archipelago. The fourth most populous country in the world, Indonesia comprises more than 13,000 islands extending c.3,000 mi (4,830 km) along the equator from the Malaysia mainland toward Australia; the archipelago forms a natural barrier between the Indian and Pacific oceans. The capital and largest city is Jakarta, on Java.

Land and People

Consisting of the territory of the former Netherlands East Indies, Indonesia's main island groups are the Greater Sunda Islands, which include Java, Sumatra, central and S Borneo (Kalimantan), and Sulawesi; the Lesser Sunda Islands, consisting of Bali, Flores, Sumba, Lombok, and the western part of Timor; the Moluccas (Maluku), with Ambon, Seram, and Halmahera; and the Riau Archipelago. After years of dispute with the Dutch, Papua was formally annexed by Indonesia in Aug., 1969. The most important islands, culturally and economically, are Java, Bali, and Sumatra.
All the larger islands have a central volcanic mountainous area flanked by coastal plains; there are more than 100 active volcanoes. Earthquakes are frequent and, although not usually severe, can sometimes cause devastation. The animal life of Indonesia roughly forms a connecting link between the fauna of Asia and that of Australia. Elephants are found in Sumatra and Borneo, tigers as far south as Java and Bali, and marsupials in Timor and New Guinea. Crocodiles, snakes, and richly colored birds are everywhere. The tropical climate, abundant rainfall, and remarkably fertile volcanic soils permit a rich agricultural yield.
The population falls roughly into two groups, the Malayan and the Papuan, with many of the inhabitants east of Bali representing a transition between the two types. Within each group are numerous subdivisions, and cultural development ranges from the modern Javanese and Balinese to traditional tribes in Borneo, Sumatra, and New Guinea. The complex ethnic structure is the result of several great migrations many centuries ago, largely from Asia. The Chinese constitute by far the greatest majority of the nonindigenous population; they number about 2 to 3 million and play an important role in the country's economic life. There are smaller minorities of Arabs and Indians.
More than 300 languages are spoken in Indonesia, but an official language, Bahasa Indonesia (regarded as the purest Malay), has been adopted and has spread rapidly; it is now understood in all but the most remote villages. English is considered to be the country's second language. Almost 90% of the population is Muslim, making Indonesia the largest Islamic nation in the world. Slightly less than 10% of the population is Christian, and about 2% is Hindu and 1% Buddhist. Hindus are concentrated principally on Bali, which is known for its unique culture. Animism, sometimes combined with Islam, is common among some groups.
Notable among the many state universities scattered throughout the islands are the Univ. of Indonesia, at Jakarta; the Bandung Technology Institute, at Bandung; Airlangga Univ., at Surabaya; Gadjah Mada Univ., at Yogyakarta; and the Univ. of North Sumatra, at Medan. Private schools include the Islamic Univ. of Indonesia, at Yogyakarta, and National Univ., at Jakarta.

Economy

Crude oil and natural gas are Indonesia's most valuable natural resources and have long been its major source of export revenue, but declines in production since the 1990s made the nation a net importer of oil in 2004. Agriculture accounts for about 16% of the GDP and employs over 40% of the labor force. Indonesia is one of the world's major rubber producers; other plantation crops include sugarcane, coffee, tea, tobacco, palm oil, cinchona, cloves, cocoa, sisal, coconuts, and spices. Despite plantation cultivation, Indonesia has a wide landholding base; the majority of the people are largely self-sufficient in food. Rice is the major crop; cassava, corn, yams, soybeans, peanuts, and fruit are also grown. Horses and cattle are raised on some of the Lesser Sunda Islands. Fish are abundant, both in the ocean and in inland ponds.
In natural-resource potential, Indonesia is one of the wealthiest countries in the world. It has great timberlands; vast rain forests of giant trees (among the world's tallest) cover the mountain slopes, and teak, sandalwood, ironwood, camphor, and ebony are cut. Palm, rattan, and bamboo abound, and a great variety of forest products is produced. Indonesia is a major exporter of timber, accounting for nearly half of the world's tropical hardwood trade. However, the rapid deforestation of Indonesia's hardwoods, mainly due to its expanding population and growing timber-related industries, has caused concern among international environmental groups and sparked ethnic conflict (particularly between immigrants and native Dyaks on Borneo).
Tin, bauxite, nickel, coal, manganese, copper, gold, and silver are mined, and salt is available in large quantities from shallow enclosed seashore lagoons. Iron and uranium are believed to exist in quantity but have not yet been exploited. Primarily a supplier of raw materials, the country began to industrialize and developed rapidly in the 1990s. The industrial sector includes the manufacture of textiles, cement, chemical fertilizers, electronics, rubber tires, and clothing and shoes (much of them for the U.S. market), as well as food, mineral, and wood processing. The government has also promoted tourism, and Bali is a popular tourist destination. Indonesia has attracted increased foreign investment in recent years, but corruption is widespread. Labor unrest has been a persistent problem due to the tensions between the predominantly ethnic Chinese business owners and a workforce made up almost entirely of ethnic Malays. The country's economy was severely impacted by the 1997–98 Asian financial crisis and it continues to experience high unemployment and inflation, although the nation began to rebound in 2000. Indonesia's main trading partners are Japan, the United States, Singapore, and South Korea.

Government

Indonesia is governed under the constitution of 1945, which was restored in 1959, and its amendments. The unicameral legislature is the 550-member House of Representatives (Dewan Perwakilan Rakyat or DPR), who are popularly elected (by proportional representation) from multimember constituences. This body plus 195 indirectly selected members make up the People's Consultative Assembly (Majelis Permusyawaratan Rakyat or MPR), which meets every five years to determine national policy and annually to consider constitutional amendments and other changes. The president and vice president are popularly elected; before 2004 they were chosen by the MPR. The president, who is the chief executive, appoints a cabinet. For over 30 years, until 1999, the government was essentially controlled by the quasi-official Golkar party. Administratively, the country is divided into 30 provinces, 2 special regions, and the special capital city district of Jakarta; these are subdivided into regencies (districts).

History

Early History and Colonial Rule
Early in the Christian era, Indonesia came under the influence of Indian civilization through the gradual influx of Indian traders and Buddhist and Hindu monks. By the 7th and 8th cent., kingdoms closely connected with India had developed in Sumatra and Java; the spectacular Buddhist temples of Borobudur date from this period. Sumatra was the seat (7th–13th cent.) of the important Buddhist kingdom of Sri Vijaya. In the late 13th cent. the center of power shifted to Java, where the fabulous Hindu kingdom of Majapahit had arisen; for two centuries it held sway over Indonesia and large areas of the Malay Peninsula. A gradual infiltration of Islam began in the 14th and 15th cent. with the arrival of Arab traders, and by the end of the 16th cent. Islam had replaced Buddhism and Hinduism as the dominant religion. The once-powerful kingdoms broke into smaller Islamic states whose internecine strife made them vulnerable to European imperialism.
Early in the 16th cent. the Portuguese, in pursuit of the rich spice trade, began establishing trading posts in Indonesia, after taking (1511) the strategic commercial center of Malacca (see Melaka) on the Malay Peninsula. The Dutch followed in 1596 and the English in 1600. By 1610 the Dutch had ousted the Portuguese, who were allowed to retain only the eastern part of Timor, but the English competition remained strong, and it was only after a series of Anglo-Dutch conflicts (1610–23) that the Dutch emerged as the dominant power in Indonesia.
Throughout the 17th, 18th, and 19th cent. the Dutch East India Company steadily expanded its control over the entire area. When the company was liquidated in 1799, the Dutch government assumed its holdings, which were thereafter known in English as the Netherlands (or Dutch) East Indies. Dutch rule was briefly broken (1811–14) during the Napoleonic Wars when the islands were occupied by the British under T. Stamford Raffles. The Dutch exploited the riches of the islands throughout the 19th cent., but their rule did not go unchallenged by the Indonesians. In 1825, Prince Diponegoro of Java launched a long and bloody guerrilla war against the colonists, and in 1906 and again in 1908 the native rulers of Bali led their subjects in suicidal charges against Dutch fortifications.