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Indonesia Prepares for Mass Protests Against Fuel-Price Rise

Indonesia Prepares for Mass Protests Against Fuel-Price Rise
Motorcyclists queue up to refuel their motorcycles at a PT Pertamina gas station in Jakarta. Photographer: Dimas Ardian/Bloomberg

Indonesia deployed 22,000 police and military personnel across the nation’s capital in anticipation of mass protests against a government proposal to raise the price of subsidized fuel by 33 percent.

About 8,000 Indonesian college students, members of labor unions, non-government organizations and political parties are expected to take to the streets in Jakarta today to demonstrate against a plan to raise the price of diesel and low-octane gasoline to 6,000 rupiah (65 U.S. cents) per liter from 4,500 rupiah per liter.

“The protesters will be in strategic locations such as around the House of Representatives in South Jakarta, the Hotel Indonesia circle and the presidential palace in Central Jakarta,” Rikwanto, a spokesman for the Jakarta police, said by phone today.

Surging oil prices led China to boost fuel costs the most in more than two years this month and have added pressure on nations from Indonesia to India to raise tariffs. The proposed increase being debated by the Indonesian parliament may cause inflation to double to 7 percent by year-end, National Economic Committee Vice Chairman M. Chatib Basri said in an interview with Bloomberg Television in Hong Kong on March 23.

Security forces had set up water cannons, local television stations had set up satellite trucks and about 100 protesters had gathered in the main traffic circle in central Jakarta by 10:15 a.m. Regular vehicle traffic was unimpeded.

Indonesia’s legislature will vote March 29 on the government’s proposed revisions to the 2012 budget, which include the fuel-price increases.


Raising the price by 1,500 rupiah per liter may boost inflation to 6.8 percent this year, Bank Indonesia Governor Darmin Nasution said March 8. Consumer prices rose 3.56 percent last month from a year earlier, the least in 23 months.

The central bank has said it will respond to a surge in costs if needed. Bank Indonesia has cut interest rates by one percentage point to 5.75 percent in three moves since the start of October 2011.

Indonesia must increase the price of subsidized fuel to cut the cost of providing energy amid rising crude prices, President Susilo Bambang Yudhoyono said in a cabinet meeting Feb. 22. “Like it or not the price of fuel must be adjusted with the

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