Indonesia Plans Malacca Toll, Echoing Iran Hormuz Move
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- Indonesia signaled it may monetize transit through the Strait of Malacca, mirroring Iran’s earlier but unformalized approach in Hormuz.
- India receives about 50% of its crude and nearly 90% of its LPG and LNG imports via the Strait of Hormuz, making it its single biggest energy vulnerability.
- India routes 70% of its crude imports through longer alternative sea routes—including the Arctic and Baltics—since the Hormuz closure, a practice deemed economically unsustainable over the long run.
- India sends more than a third of its global trade, especially with Southeast Asia, through the Strait of Malacca, linking its trade artery to a potential toll regime.
- India’s energy and maritime policies are handled by separate institutions, creating coordination challenges when chokepoints become regulated.
- India could mitigate chokepoint risk by expanding domestic renewable generation, electrifying transport, and increasing strategic reserves, according to the analysis.
Why it matters: India stands to lose economic stability as a Malacca toll would raise transport costs and increase exposure to foreign regulatory decisions, while Indonesia would gain revenue from the new charge. The shift forces India to rethink its energy sourcing and invest in domestic renewables to mitigate chokepoint risk.
