Independence and the Development Paradox

Ahead of Indonesia’s 81st independence celebrations, the Central Statistics Agency (BPS) reported the latest conditions of Indonesian society. According to BPS data, the number of open unemployed in May 2026 fell to 7.22 million people (4.65%). Meanwhile, the number of poor people in March 2026 shrank to 22.93 million people, or 8.07% of the total population. Compared with September 2025, the number of poor people fell by 430,000, while compared with March 2025 it fell by 920,000.

The government’s success in reducing poverty in 2026 marks the lowest poverty rate in more than a decade, continuing the downward trend since the post-pandemic economic recovery. Besides the falling number of poor people, the quality of poverty was also reported to have improved. The Poverty Depth Index (P1) fell to 1.268 from 1.290 in September 2025, while the Poverty Severity Index (P2) fell to 0.291 from 0.303.

According to BPS, the decline in poverty was driven by economic growth in the first quarter of 2026 reaching 5.61% year-on-year, rising household consumption, the addition of around 1.9 million jobs between February 2025 and February 2026, and the distribution of social assistance by the government. Within certain limits, economic growth is claimed to have succeeded in creating jobs, reducing unemployment, increasing workers’ incomes and reducing poverty.

However, BPS also reported that the level of inequality in the distribution of household expenditure, as measured by the Gini ratio, stood at 0.368 in March 2026, up 0.005 points compared with September 2025. Meanwhile, the Gini ratio in rural areas rose by 0.004 points and in urban areas by 0.001 points. So although the government claims the economy is growing above 5% and the number of poor people is falling, what is actually happening behind that is an increase in social inequality. The economic cake is often enjoyed only by the upper-middle class. This is the reality that still colours Indonesia’s independence celebrations to this day.

In every independence celebration in August, the state address that is delivered usually sets out a list of development successes and claimed improvements in economic growth. Every August, we can witness how various corners of the city are adorned with flying red-and-white flags and how various lively 17 August competitions are held, especially the greasy pole climb watched with laughter by residents. In short, people seem to forget what they are experiencing because they are swept up in the joyful celebrations.

Independence celebrations are always a sacred and joyful moment. Yet behind the festivity of this national party, there is another reality that is often overlooked: structural poverty that still haunts and a widening social gap. To be sure, compared with the colonial era, what the Indonesian people feel today is far better. But true independence is not merely about the people being free from the grip of foreign colonisers or the flying of flags on the highest poles.

The essence of independence is when every citizen has a guarantee of a decent livelihood, fair access to health care and adequate social protection. When millions of people are still grappling with the pressures of daily needs, soaring rice prices, unemployment because decent work is hard to find, and being trapped in debt to illegal online lenders, then claims about economic progress and national success still feel far from reality.

One can imagine how the poor feel when BPJS participants, who should have the right to be served properly, instead become victims of bullying. How can the people smile when the land they have occupied for decades is seized for development purposes? When the informal sector and the presence of migrants in cities are regarded more as a nuisance than understood as victims, then what do they have to be grateful for in independence celebrations that appear festive and full of laughter?

Although much progress has been achieved, it must be objectively acknowledged that Indonesia is still overshadowed by a welfare paradox. For most of the elite and the upper-middle class, independence celebrations are indeed welcomed and celebrated as a blessing of progress. In various regions, grand infrastructure development, massive industrialisation, new toll roads and digitalisation in various aspects of life are achievements they enjoy. But for poor families in marginal pockets—whether in urban slums or in left-behind rural areas—true independence remains a dream. As citizens they are free, but as poor people they still suffer.

The Central Statistics Agency (BPS) has shown year after year that poverty figures are indeed declining statistically. However, the poverty line that is set often does not reflect the real cost of living today. Many vulnerable groups sit just above the poverty line and could fall back into poverty at any time due to a small shock, such as being laid off, a failed harvest, or the medical costs of a seriously ill family member. In other words, people who are statistically not categorised as poor are in fact part of the near-poor group who could at any time drop in status to become the new poor.

President Prabowo Subianto, when inviting rectors and professors to Jakarta early last year, presented data that differed from BPS data. According to Prabowo, in 2017 the number of poor people was recorded at 46.1%, while in 2024 it actually rose to 49.5%. Meanwhile, the middle class in 2017 was recorded at 22.1%, but in 2024 it fell to 17.4%. Prabowo also added that the wealth of the 10 richest families in Indonesia rose by 153% from 2017 to 2024. This is Indonesia’s paradox.

For the middle and established groups, Prabowo acknowledged the figure is only 17.01%, or 47.89 million people. This means that more than 240 million Indonesians are still in the category of not yet prosperous. They are still classified as moving towards prosperity, vulnerable to poverty, poor and very poor. Prabowo stated that the category of moving towards prosperity is actually a form of euphemism, because behind it what is happening is a way of softening reality, since moving towards prosperity means not yet prosperous. In other words, they are still poor. This was Prabowo’s statement at a meeting with rectors and professors at the State Palace.

The independence celebration that we commemorate every 17 August is a momentum. It is not merely a reminder of the history of past struggles, but also a moment to introspect and reassess the development route we have taken so far. Behind the independence festivities, we need to make room for the conscience of the political elite in this country to see the part of the people who are not joining the party because they are still afflicted by poverty, illness, malnutrition and hunger.

In the fifth principle of Pancasila, it is clearly stated that social justice must be realised for all Indonesian people. This is not mere rhetoric in a state document. The fifth principle of Pancasila is a moral and constitutional promise of the founders of this republic that should be implemented by the leaders of a nation that has been independent for 81 years. Celebrating the independence of the Republic of Indonesia without a willingness to evaluate social inequality is a form of neglect of the essence of independence itself.

Independence will only become a people’s party—and not merely a state celebration—when poverty no longer haunts the Indonesian people, and the smile of justice is written on the face of every child of the nation regardless of their parents’ economic background. There lies the true meaning of independence, namely when the state is truly present to protect the weak and level the path for those left behind. A state that allows inequality to continue is in fact a betrayal of the spirit of struggle of the founders of this beloved republic.