Jakarta, ThedailyID — Finance Minister Purbaya Yudhi Sadewa said the peace agreement between the United States and Iran could create additional fiscal space in Indonesia’s state budget.
Speaking at the Parliament Complex in Central Jakarta on Monday, June 15, Purbaya said the government had previously set aside part of the budget to anticipate higher subsidy spending amid tensions in the Middle East.
“As we previously reserved part of the budget for subsidies, the burden could decrease significantly. That would create room to finance other programs considered important by the president,” Purbaya said.
He added that the government would continue monitoring developments before making adjustments to budget allocations.
The comments came after U.S. President Donald Trump announced that Washington and Tehran had reached a peace agreement.
In a post on Truth Social on Sunday, June 14, Trump claimed the deal had been finalized and said the U.S. blockade on Iran would be lifted as part of the agreement.
“The deal with the Islamic Republic of Iran is now complete. Congratulations to everyone!” Trump wrote.
According to Purbaya, easing geopolitical tensions could help stabilize global energy prices. Consequently, lower oil prices would reduce pressure on Indonesia’s subsidy spending.
Earlier, the government had prepared for the possibility of higher energy costs if tensions in the Middle East escalated. Therefore, officials allocated part of the budget to absorb potential increases in subsidy expenditures.
If energy prices remain stable, Indonesia could redirect some of those funds toward priority programs and development initiatives.
Nevertheless, Purbaya emphasized that the government would wait for further developments before revising fiscal assumptions or reallocating spending.
