The deal on tariffs between Indonesia and the United States, as announced by President Donald Trump last week, has put Indonesia on the good side of Washington, shifting its position in the current big power rivalry away from China, at least momentarily.

The government has pressed ahead with launching the Red and White Rural Cooperative (KDMP) as President Prabowo Subianto’s latest flagship economic initiative, despite the ongoing deliberation of the Cooperatives Law revision at the House of Representatives. July 21, 2025, witnessed the inauguration of 80,081 KDMPs nationwide with an aim to spur grassroots economic growth. However, the program’s design, which leverages village funds as collateral, poses risks not only to state finances but also to the broader goals of sustainable rural development.

Before the final verdict and sentence were handed down on July 18 in the sugar import graft trial, many had hoped the Jakarta Corruption Court would deliver a just decision. This did not turn out to be the case, and Thomas “Tom” Trikasih Lembong was convicted and handed a penalty of four years and six months in prison and a fine of Rp 750 million (US$46,000).

The Batam Free Trade and Free Port Zone Development Authority (BP Batam) recorded realized investments to Batam City, Riau Islands Province reached about Rp32 trillion in the first half (H1) of 2025, or more than 50.1 percent out of its Rp64 trillion annual target.

United States President Donald Trump has announced a 19 percent import tariff on Indonesian goods, down from the original 32 percent disclosed in April. According to him, during negotiations to secure the lower rate, Indonesia agreed to not impose any retaliatory tariffs on US products. Although a tariff rate of 19 percent is still relatively steep, it is lower than the rates many other countries face, giving Indonesian exporters a competitive advantage in the US market. However, some observers have raised concern over the other side of the deal: US goods are now free to enter Indonesia without duties, which some fear could harm local industries.

The Constitutional Court's recent landmark decision to separate national and regional elections has created significant implications for legislatures, particularly the House of Representatives. In Decision No. 135/PUU-XXII/2024 issued on June 26, the court mandated that starting in 2029, national elections for president, vice president and members of the House and Regional Representative Council (DPD) are to be held 2 to 2.5 years prior to the elections for regional legislative councils (DPRD) and the heads of provincial, municipal and regency administrations.

The first phase of Nusantara Capital City (IKN) development has officially concluded, with the IKN Authority confirming it will receive Rp 48.8 trillion (US$3 billion) from the state budget to continue the project’s second phase through 2028. Although President Prabowo Subianto initially pledged to begin working from IKN starting August 2028, uncertainty looms, as he has yet to demonstrate genuine interest in relocating the nation’s capital.