JK Outlines Two Ways for the Government to Save Amid Iran-US War
Jakarta - Former Vice President of Indonesia, Jusuf Kalla (JK), stated that there are only two ways for the Indonesian government to economise on state expenditures amid the geopolitical situation of the Iran-US and Israel war.
“Indeed, the government is facing dilemmas, as I see it. For the costs, there are only two ways to resolve this: reducing spending or striving to increase revenue,” JK said when met at the Indonesian Red Cross (PMI) headquarters in Jakarta on Wednesday (18/3/2026).
As a result, the economising options can only be achieved by lowering state spending costs or increasing the budget deficit in the state revenue and expenditure budget (APBN).
“Well, the government just needs to choose one of them: increasing the debt deficit or reducing costs. It seems that Mr Prabowo is choosing to lower spending so that the deficit does not become as large as it might otherwise, remaining at 3 percent,” he added.
According to JK, the government will face many consequences if it reduces state spending.
“If spending is reduced, especially regional spending, it’s a pity for the regions—3-17 percent—that the entire population in Indonesia will face difficulties in transportation and regional development for the people in the areas,” JK said.
However, if spending in sectors like education and others is economised, the quality of public services in those sectors will also be affected.
“If education, the quality of our education will decline. If health, health facilities will decline,” he added.
“There are only two choices, no other options. You either increase debt or reduce this spending because revenue is declining,” JK said.
It was previously reported that the government is examining several steps for budget economising following the escalation of conflict in the Middle East after the United States (US) and Israel attacked Iran.
Several economising options planned to be pursued by the government include implementing work from home (WFH) for civil servants (ASN) to save on fuel oil (BBM) consumption.
“For example, it is being studied to avoid congestion. Jakarta’s traffic jams waste BBM, whereas BBM will eventually run out; if the war does not stop soon, its price will rise,” said Muhaimin, after the free homecoming event at the PKB DPP office in Central Jakarta on Sunday (15/3/2026).
Nevertheless, Muhaimin emphasised that the idea is his personal proposal and is still in the study phase at the government level.
“Yes, that’s my personal proposal; at the Ministry of PAN-RB level, it is being studied,” Muhaimin stated.