The ratification of the Major Defense Cooperation Partnership (MDCP) between Indonesia and the United States on 13 April 2026 marks a crucial development in the Indo-Pacific security dynamics. This cooperation focuses on underwater domain awareness, asymmetric warfare capabilities, and modernising the Indonesian Air Force fleet. Alongside this partnership, there is intense debate regarding the blanket overflight access requested by the US from Indonesia. This has drawn all eyes to this route, through which 40% of global trade passes, yet the next major strategic chokepoint actually lies on the seabed off Indonesia’s coast
Archipelagic Digital Architecture: From Malacca to Makassar
99% of the world’s Internet traffic travels via undersea cables rather than via satellite; information between continents and countries is digitally connected via fibre-optic cables on the seabed. These cables form the foundation for essential services, such as data transfer, cloud computing, and government communications. Indonesia has 115,104 km of undersea fibre-optic cables, some of which are part of the global digital backbone.
Beneath the surface of the Strait of Malacca lies a web of competition and geopolitical ambitions. The PEACE cable connects Asia, the Middle East, Africa, and Europe. Moreover, this digital network was established by China to reduce its reliance on Western infrastructure and influences. Overlapping with this route are SEA-ME-WE 5 and 6, high-speed maritime infrastructures supporting trillions of dollars’ worth of transactions between Southeast Asia, the Middle East, and Western Europe. In parallel, India’s Asia Xpress (IAX) positions itself as a global network hub with a massive capacity of 200 terabits per second (Tbps). While the Malacca Strait is congested and vulnerable to sabotage or anchor dragging, next-generation cables are shifting to pass through the internal waters of the Indonesian Archipelago, namely, the Makassar Strait. Bifrost is the first direct route between Southeast Asia and the United States, bypassing South China Sea.
The Malacca Strait digital architecture is highly strategic but has a weakness in that it lies in very shallow waters—around 25–27 m deep—and is situated directly beneath one of the busiest commercial shipping lanes on earth, making it highly vulnerable to threats such as anchor drag and sabotage.
Historical Context of Asymmetric Warfare
In their book Unrestricted Warfare, Chinese Air Force Colonels Qiao Liang and Wang Xiangsui argue that warfare is unrestricted and always targets what Carl von Clausewitz termed the enemy’s ‘centre of gravity’. Amidst global instability caused by conflicts such as the US-Iran war, the Ukraine-Russia war, and technological competition in Artificial Intelligence between China and the US, a shift in warfare from land to sea is not an impossible scenario. This is beginning to manifest, with Iran reportedly threatening to cut Red Sea cables on 27 March 2026. History records several instances of undersea cable cuts and sabotage, ranging from the British severing of German communication cables on the first day of the First World War in 1914, Operation Ivy Bells, a deep-sea espionage operation, the destruction of 11 Baltic undersea cables in 2023, and the plausible denial tactics employed by Chinese commercial cables in the Matsu Islands in Taiwan.
If wars today revolve around oil, they will revolve around fibre-optic infrastructure in the future. In grey zones or along trade routes, an old ship or commercial vessel could feign engine failure, drop anchor, or use state-of-the-art technology to copy data and damage strategic cables without declaring war. Historically, warfare at a certain level has shifted the focus of conflict towards the most vital infrastructure for espionage, disruption, or as a means of balancing power. This form of warfare, involving the disruption of networks or the copying of data, is referred to in the book Unrestricted Warfare as ‘The New Terror War.’
Regulatory Diplomacy
In the face of the threat posed by the New War on Terror on the seabed, the most tactical response for a nation adhering to the principle of active neutrality is not merely the deployment of a combat fleet but also mastery of the instruments of regulatory diplomacy. Licencing and spatial planning can be used as geopolitical bargaining tools. If modern warfare relies on the sabotage of strategic undersea cables, then the subsequent counter-attack lies in how efficiently a country’s regulations and procedures for infrastructure repair are implemented
However, Indonesia has not optimally used this strategic position. When the SEA-ME-WE 5 cable was damaged in April 2024 in Indonesian waters in the Strait of Malacca, Indonesia’s administrative bureaucracy and protectionist policies delayed repairs from approximately three days to weeks. This stands in stark contrast to Singapore’s licencing governance, which implements an efficient Service Level Agreement (SLA). Such issues have caused Indonesia’s Regulatory Quality Index to stagnate at 60.85%, a figure far below Singapore’s, which is close to a perfect score. In addition, Singapore excels in the Worldwide Governance Indicators; for major global companies, this metric is an absolute parameter of investment. They avoid Indonesian waters not because of geographical location but because regulations in Indonesia tend to be unstable, and the licencing process remains slow, thereby placing large investments at extreme risk.
Singapore has demonstrated that administrative efficiency is a key source of leverage, enabling it to become Southeast Asia’s digital hub despite its lack of extensive internal waterways. For Indonesia, regulatory diplomacy must not be viewed merely as an investment service desk but rather as the first line of defense against maritime sabotage.
As undersea digital infrastructure becomes a target in The New Terror War, tech giants and superpowers are not only seeking waters safe from sabotage, but also a bureaucracy with Service Level Agreements (SLAs) guaranteeing ultra-fast repairs; Indonesia must leverage this legal certainty and licencing governance as a geopolitical instrument. Strategic transit permits for the waters of the Indonesian archipelago and bureaucratic guarantees for crisis recovery must not be granted for free, but must be bartered conditionally for a commitment to invest in the construction of data centres on the Indonesian mainland to capture the opportunity presented by a surge in demand of 16.8% per annum up to 2029.
Conclusion
The current escalation of global tensions carries a significant risk of repeating the history of asymmetric warfare, culminating in sabotage and the severing of undersea telecommunications networks. At the crossroads between the threat of a world war and the explosion in infrastructure needs in the age of artificial intelligence, Indonesia has strategic momentum. To capitalise on this, the national regulatory paradigm must be reformed; bureaucracy must not be a sluggish administration but must be able to transform into an instrument of bargaining power and a geopolitical counterweight. Indonesia must create political stability and an efficient licensing and governance system. In doing so, Indonesia will not only secure its digital sovereignty but also be able to extract benefits from international technology giants.
