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Indonesia's Papuan Problem

Panjaj Kumar Jha was Associate Fellow at Institute for Defence Studies and Analyses, New Delhi. Click here for detail profile.
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  • May 09, 2006

    Indonesia and Australia have been at diplomatic loggerheads on the issue of granting political asylum to 42 Papuan refugees who sailed into Australia's Cape York Peninsula in January 2006. While Australia has granted them temporary visas, Indonesia has been asking for their repatriation. Papua has been projected as the next East Timor by Australia and this has become an issue for the Indonesian authorities as Papua has rich mineral resources and Indonesia would not like to have Papua go the East Timor way. The Papuan freedom struggle has been led by the Free Papua Movement (OPM), the two main issues being discrimination by Indonesian authorities and the extensive exploitation of its resources by the Louisiana based Freeport McMoRan Copper and Gold Company. Papua, previously known as Irian Jaya, is a Melanesian, predominantly Christian populated, territory whose people and culture resemble that of Papua New Guinea, which lies on its east. Freeport has been operating in the region for more than three decades and has contributed substantially to the Indonesian treasury to the tune of US$33 billion to date. It is Indonesia's largest taxpayer and employs 18,000 workers and has done health and welfare work in Papua but is also held responsible for the atrocities committed on the Papuan people.

    Indonesia won sovereignty over Papua, then called West Irian, through the New York Agreement with the Dutch in 1962. Trouble began soon thereafter following the 1969 'Act of Free Choice' integration referendum under UN auspices that involved just 1,000 handpicked tribal leaders and was widely labelled a sham by Papuan leaders. Nonetheless, West Irian was recognised as part of Indonesia. Papuan resistance to Indonesian authority emerged soon after the transfer of administrative control. OPM was formed in 1964 and the first substantial revolt took place in Manokwari the following year. Mining activities were started by Freeport in Papua in the late 1960s with the full support of the Suharto government. The lack of development and infrastructure aggravated the problems between the Indonesian government and the Papuan populace. Riots broke out in March 1996 in the mining camps of Tembagapura and Timika. In order to assuage anti-Freeport feelings, the company started a scheme in 1997 to provide one per cent of the mine's revenues to the seven local tribes of Papua but the distribution of money has been mired in controversies. In order to counter growing dissension, the Indonesian Parliament passed a bill in 1999, which divided Papua into three provinces - Papua, Central Irian Jaya and West Irian Jaya.

    Freeport has been paying the Indonesian military (TNI) for protecting its interests in the wake of these intensified protests, but the amounts were disclosed only in 2002-03 after the deaths of two American school teachers and their Indonesian colleague in an ambush on the road to the mine, which raised questions about the company's relationship with the military. Though individual payment records were withheld by the company, Global Witness, a London based investigative organisation working in the field of exposing the nexus between natural resource exploitation and human rights abuses, was able to obtain these records. In order to save themselves from further embarrassment, Freeport and the Trikora regional military command signed an agreement to secure government designated vital national assets including Freeport. On January 27, 2006, the Indonesian government passed a decree which provides a specific legal basis for corporate assistance to government security forces guarding both the Grasberg mine and Exxon Mobil's gas fields in Aceh.

    The Grasberg mine has produced 16.1 billion pounds of copper and 23.3 million ounces of gold since 1988 and the mine's reserves are currently estimated at more than 40 billion pounds of copper and 46 million ounces of gold. In spite of the fact that the world's richest mine is located in Papua, the condition of the local populace has not improved over the years. Student-led protests in April 2006 saw four policemen, one air force personnel and a protester beaten up and stoned to death. Despite the violent protests, President Susilo Bambang Yudhoyono refused to accept the protestors' demand that the Grasberg mine be closed.

    Other actors are also jumping into the fray. Amien Rais, one-time presidential candidate and founder of the National Mandate Party, has raised objections to the existence of Freeport in Indonesia. Indonesian nationalism in recent years has become increasingly linked to US actions around the world, perceived as attacks on Islam. Freeport and Exxon are seen as prime targets since they are American companies.

    Freeport has proposed to redistribute the royalty of $1.1 billion from this year. Papua is assured of a meagre $65 million but even this money is to be routed through the finance ministry in Jakarta, which is not acceptable to the Papuans. The ongoing protests might jeopardise British Petroleum's (BP) 24 trillion cubic feet Tangguh gas field project, which would reach its full production capacity in 2016. The problem can be defused through active engagement of the various actors involved, including the protestors, Australia, Freeport and Indonesia. The mostly roadless territory of Papua needs infrastructure and empowerment of the village councils so that grievances could be addressed. Moreover, the TNI needs to be restrained from taking action against Papuans at the behest of the company.

    Efforts have been made by both Australia and Indonesia to defuse the crisis, while an umbrella organisation of Papuan independence groups has also shown interest in seeking a peaceful solution. The Indonesian president has also shown keenness to enter into negotiations as a way out of the diplomatic and political impasse in Papua. The most likely negotiator could be the Crisis Management Initiative (CMI), which earlier played a key role in mediating the peace settlement in Aceh. The whole process has been kept under wraps so as not to activate the security hardliners in the TNI or the Indonesian parliament. The special autonomy proposal of the Indonesian government has not drawn a favourable response from the Papuan people and so there is need for constructive engagement without hampering the interests of the parties involved.

    In the overall perspective, it can be said that with regard to negotiations with Papua, the Indonesian government would not like to concede as much as it did with the Aceh rebels in August 2005. Aceh was granted 70 per cent of the oil and gas revenues apart from partial self-rule. In contrast, given Papua's abundant natural resources as well as the fact that the Papuan resistance movement is comparatively much weaker, the Indonesian government would likely limit itself to offering a certain percentage of royalties from mining to the locals and to instituting a provincial council to mediate upon contentious issues.