Government Urged to Prepare Concrete Policies to Mitigate Iran War Impact
The chairman of Indonesia’s House of Representatives Commission XI, Mukhamad Misbakhun, has urged the government to quickly prepare concrete policy responses to dampen potential pressure on the national economy, particularly during the Ramadhan and Eid al-Fitr period. This comes amid escalating conflict between the United States-Israel and Iran, with both sides conducting retaliatory strikes.
Misbakhun believes that the escalation of Middle East conflicts could involve key countries in the global energy supply chain, potentially triggering a surge in oil prices and financial market volatility. He argues that without prudent anticipation, this could weaken the rupiah, burden energy subsidies in the state budget, and drive up the prices of goods and services domestically.
“Ramadhan is always characterised by increased consumer spending. If at the same time global energy prices surge and exchange rates fluctuate, then pressure on domestic inflation will be increasingly felt. Therefore, the government must act quickly with clear fiscal scenarios and concrete stabilisation measures,” Misbakhun told reporters on Monday, 2 March 2026.
He further requested that the Finance Ministry prepare realistic emergency fiscal scenarios and consider adjusting the state spending posture should world oil prices remain at elevated levels. He believes that important measures that can be taken include strengthening fiscal reserves and sharpening spending priorities, thereby maintaining fiscal space without compromising social protection programmes.
Misbakhun also asked the Finance Ministry and Bank Indonesia to enhance coordination to maintain exchange rate stability and financial market liquidity. This is because global shocks often trigger capital outflows and pressure on the rupiah, so fiscal and monetary policy mixes must be prepared within an integrated response framework.
“Rupiah stability and sufficient banking liquidity must not be disrupted. The business world needs certainty, whilst the public needs reassurance. Therefore, fiscal and monetary policies must work in tandem to calm market volatility,” said Misbakhun.
Additionally, the Golkar politician urged the government to ensure energy supply availability and smooth domestic logistics distribution remain intact. He believes that should world oil prices surge significantly, the government must prepare buffer measures so that domestic fuel prices do not immediately trigger cascading effects on food prices and other basic necessities.
“What we must protect is the purchasing power of the public. They must not face layered price increases whilst carrying out Ramadhan worship and preparing for Eid al-Fitr,” Misbakhun said.
Misbakhun stated that Commission XI of the House of Representatives will intensively monitor the government’s policy response to developments in the conflict, including its impact on energy subsidies, inflation, exchange rates, and the stability of the national financial system.