May 9, 2006.
Iranian President Mahmood Ahmadinejad with Indonesian President Susilo Bambang Yudhoyonoin Jakarta.
Rendi Akhmad Witular, The Jakarta Post, Jakarta
The visit of Iranian president Mahmoud Ahmadinejad to Indonesia, due to start late Tuesday evening, will focus primarily on boosting economic relations between the two countries, with Iran pledging to invest more than US$4 billion in several oil and gas projects here.
Besides investing in the country's oil and gas sector, Iran also hopes to boost bilateral trade with Indonesia, which is deemed to be falling far short of its potential, Foreign Affairs Minister Hassan Wirayuda says.
"The visit this time will focus more on economic cooperation based on concrete projects. Iran is interested in investing in refineries and supplying the crude," said Hassan late Monday after meeting President Susilo Bambang Yudhoyono.
The National Iranian Oil Refinery & Distribution Co. is slated to sign a deal with PT Elnusa Harapan, a subsidiary of state oil and gas firm PT Pertamina, to construct a refinery in Java with a capacity of 300,000 barrels per day (bpd).
Iran, the world's fourth-largest oil producer, is also interested in establishing a number of joint-venture companies in Indonesia that would operate in the oil, gas and petrochemical businesses.
This interest was first conveyed during the administration of former president Megawati Soekarnoputri, but the two countries never followed up on the proposal.
Indonesia, Southeast Asia's largest economy, badly needs new investment for its oil and gas sector to boost output. Although the country is the only Southeast Asian member of the Organization of Petroleum Exporting Countries (OPEC), its oil output has fallen 5 percent annually over the last decade to 1.05 million bpd at present.
The latest efforts by Iran to bolster economic ties with Indonesia come against the backdrop of a nuclear standoff between Iran and the United States, with the United Nations Security Council set to meet soon to seek a common strategy to force Iran to halt its nuclear program.
In response to questions about whether Indonesia would convey its stance over the nuclear issue to Ahmadinejad, Hassan simply said that "it would be the right time for Indonesia to seek first-hand information from Iran about the issue."
The Shiite-dominated Islamic republic -- which has forged excellent ties with Asian economic powerhouses China, India and Japan -- wants to establish a similar relationship with Indonesia, which has the world's biggest Muslim population.
Hassan said Indonesia and Iran would also discuss ways of increasing cooperation in the science and technology fields, which is considered necessary to boost the economic development of the Islamic world.
In order to facilitate the flow of visitors between the two countries, Indonesia will grant Iranian citizens a visa-on-arrival facility to complement the visa-free facility available to Iranian service and diplomatic passport holders, said Hassan.
Iran already grants a two-week visa-free facility to Indonesian citizens, extendable for another two weeks.
