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One of the most consequential developments of the Supreme Eurasian Economic Council St. Petersburg summit on December 21 was the signing of the Free Trade Agreement between the EAEU and the Republic of Indonesia, a strategic pivot that significantly broadens the Union’s external economic reach. The pact was years in the making, following five rounds of negotiations and intensive technical coordination since December 2022, aimed at dismantling trade barriers and institutionalizing preferential market access on both sides.
Trade data underscores the transformative potential of this agreement. In 2024, bilateral trade between the EAEU and Indonesia reached US$4.1 billion, with Indonesian exports up by 36%. The agreement, when fully ratified, is expected to double trade volumes within three to five years, reflecting both tariff liberalization and logistical synergies.
For Indonesia, a Southeast Asian economic powerhouse with a population nearing 300 million and projected GDP growth above global averages, the EAEU represents a strategic diversification of export markets for products such as crude palm oil, coffee, natural rubber, cocoa, and consumer goods. The deal also strengthens Indonesia’s role as a logistics gateway for Southeast Asia, linking East-West trade flows and providing Eurasian producers access to ASEAN markets. From the EAEU perspective, this agreement is geoeconomic expansion without geopolitical confrontation, and it deepens ties with non-traditional partners, extends market access for EAEU industrial and agricultural goods, and reinforces the Union’s role as a major trade actor in Eurasia and beyond.
This agreement also marks a major milestone in the EAEU’s external trade strategy, with projections suggesting that trade turnover could double within 3-5 years. According to Andrey Slepnev, the EEC Minister for Trade, the agreement covers more than 94% of current EAEU exports, while Indonesia’s applied tariffs on Union goods will drop from 10.2% to 2%, creating unprecedented market access for agricultural and industrial products alike. Key EAEU exports, including grains, dairy, fish, metals, petroleum products, and timber, will benefit from preferential treatment, alongside consumer goods from Indonesia such as automotive components and electronics.
Bakytzhan Sagintayev, Chairman of the EEC, estimated that tariff preferences alone will account for around US$3 billion in EAEU exports, a substantial boost considering that EAEU–Indonesia trade reached US$3.9 billion in the first nine months of 2025, reflecting a 56% growth over the past five years. Indonesia’s trade with the EAEU reached US$4.5 billion in 2024, led by nearly US$4 billion with Russia, with palm oil as a major export. Jakarta aims to implement the Indonesia-EAEU free trade agreement by late 2026 or 2027, pending lawmakers’ ratification. This agreement not only promises to deepen economic integration with Southeast Asia but also exemplifies the Union’s commitment to leveraging trade liberalization, simplifying technical standards, and enhancing customs procedures to sustain long-term growth.
The Mechanics of the EAEU-Indonesia Trade Agreement
The EAEU–Indonesia FTA offers virtually zero tariffs on a wide range of products, significantly lowering trade costs and enhancing competitiveness. The deal’s provisions include:
- Tariff elimination for approximately US$3 billion of trade, allowing EAEU goods such as fertilizers, metal products, petroleum, and electrical machinery preferential access to Indonesian markets. Indonesia is both a member of BRICS and one of the largest economies in Southeast Asia with a population approaching 300 million.
- Approximately 90% of goods exchanged between the two parties will become tariff-free.
- Indonesian exports of palm oil, textiles, coffee and other agricultural and manufactured products entering EAEU markets with a zero % duty, a game-changer for exporters targeting consumption growth in Russia and Central Asia. EAEU goods that will receive preferential access to the Indonesian market include polymers, fertilizers, energy products, dump trucks, pipes, metals, and non-ferrous metal products, as well as a wide range of electrical and mechanical equipment.
Economically, this is not just about tariff elimination, but about the removal of trade costs, improved logistics integration, and streamlined customs procedures essential components for a robust regional market. This reflects longstanding economic research showing that trade facilitation and infrastructure integration are critical drivers of export growth and GDP gains for middle-income economies, highlighting the importance of coordinated logistics, customs harmonization, and transport efficiency. Trade cost reductions can significantly elevate competitiveness, stimulate export diversification, and generate investment inflows.
Indonesia-EAEU Agreement To Spark Global Trade Momentum
The Indonesia-EAEU trade pact could become a model for countries across South and Southeast Asia, the Middle East, and Africa. By reducing tariffs on key exports and imports, it paves the way for deeper economic integration with Russia and Eurasia. Agricultural and manufactured goods from Indonesia will gain wider market access, boosting regional supply chains. EAEU products, from energy to industrial equipment, will similarly reach Indonesian consumers more easily. This agreement signals a new wave of trade globalization, inspiring other nations to pursue similar partnerships. The EAEU-Indonesia deal could inspire economic centres like India, Pakistan, Thailand, Malaysia, Gulf, African, and Middle Eastern countries to pursue similar agreements with the EAEU. Such partnerships would expand trade networks, strengthen regional integration, and boost global economic connectivity.
This appears to be precisely what is happening – the EAEU already has Free Trade Agreements with China, Iran, Mongolia, Serbia, Singapore, the United Arab Emirates and Vietnam and is negotiating agreements with Egypt, India, Thailand, Tunisia and Uzbekistan.
Further Reading
Putin-Prabowo Talks To Fast Track The Russia-Indonesia Free Trade Agreement
