Prabowo Seeks Austerity Measures in Response to War, Cites Pakistan as Example
President Prabowo Subianto has announced his intention to implement austerity measures to address potential economic crisis resulting from the United States and Israel’s conflict against Iran. Prabowo cited the example of Pakistan, which has already undertaken significant cost-cutting measures including salary reductions for cabinet members and parliamentary representatives.
Speaking during a cabinet meeting at the Presidential Palace in Jakarta on Friday, 13 March 2026, Prabowo described the current situation as equivalent to the Covid-19 pandemic crisis. “They have even reduced salaries for cabinet members and for members of parliament, and all these salary cuts are collected to help the most vulnerable groups,” Prabowo said.
Pakistan has also implemented work-from-home policies for civil servants and private sector employees as part of its austerity strategy. According to Prabowo, the South Asian nation has reduced working days and cut government vehicle usage by up to 60 per cent. Additionally, Pakistan has suspended overseas visits and prohibited government funding for ceremonial events. Prabowo noted that Pakistan has shifted all higher education institutions to online learning and closed schools for two weeks.
These measures, Prabowo explained, help reduce fuel consumption at a time when oil prices and supplies are volatile due to Middle Eastern conflicts. The Gerindra Party leader expressed hope that Indonesia would implement similar cost-saving strategies, particularly regarding petroleum consumption. However, he acknowledged that the government is currently still reviewing which policies to adopt.
Prabowo stated that the government would study feasible measures in the coming days, emphasising that Indonesia must prepare for worst-case scenarios. “We hope the worst-case scenario will not occur in the Middle East, but many forecasts suggest this could be a very prolonged conflict,” he said.
On Friday, 13 March 2026, Brent crude oil prices returned to the level of US$100 per barrel. Prices for West Texas Intermediate (WTI) futures contracts also climbed. According to Trading Economics data, Brent crude futures reached US$101 per barrel by 14.00 on 13 March 2026, while WTI crude was quoted at US$97 per barrel.
Brent crude had briefly touched a peak of US$117 per barrel on 9 March. Current prices remain higher than the previous day’s high of US$100 per barrel on Thursday, 12 March.
Military operations in the US-Israel conflict against Iran have occurred across several regions, including central Iran and Beirut. The situation has escalated following reports that the Strait of Hormuz—a critical global energy trading route—remains effectively closed. This waterway handles approximately one-fifth of global oil distribution.
The closure of this strategic passage has forced major oil producers in the Persian Gulf region, including Saudi Arabia, to reduce production. This has raised concerns about global energy supply and prompted investors to shift towards safe-haven assets such as gold.