This question is on the impact of Dutch colonial rule in Indonesia.

8. ‘The impact of colonial rule on the local people was harmful.’ How far do you agree with
this statement? Explain your answer with reference to Indonesia. [O LEVEL 2017] [12]

Dutch rule brought political disadvantages. Direct rule meant local leaders were completely
removed. The Governor-General in Java reported directly to the Minister of Colonies in Holland.
Dutch officials ran the government in Java giving little political power to locals. Under Liberal
Policy, though Dutch incorporated local leaders into the colonial system, they were to be
appointed as regents to follow orders of a Resident. Local rulers and Priyayis retained positions
but lost their power to make decisions and rights to extract taxes, requiring compulsory labour
from people and hereditary rights were abolished. Hence, locals lost their right to govern their
land as political reforms of bringing order were excuses to use resources for Dutch’s benefit.

Dutch rule brought social benefits from economic developments. Liberal Policy transformed
Outer islands due to opening of plantations and tapping mineral resources, brought jobs for
immigrants and increased standard of living due to paid wages. Development of industries led to
improved communication infrastructure built to link plantations to towns and ports for
economic development and better standard of living. Establishment of common language due to
many different languages and dialects spoken among 13000 islands. Dutch introduced Bahasa
Melayu to simplify colonial administration and allow traders and locals to communicate with each
other, leading to a shared identity. Hence, Dutch rule brought social benefits.

Dutch rule brought economic benefits. Under Liberal Policy, Dutch established Private Enterprise
encouraging private investments for development of the Indonesian economy, leading to
production of profitable spices and products. Dutch companies modernised production
processes like irrigation systems, chemical fertilisers to improve livestock quality. Crops and
livestock were not sold for profit but for consumption. Surpluses were traded on a small scale.
Farming communities were self-sufficient. Agrarian Law allowed individuals to lease land for
agriculture up to 75 years. Sugar Law abolished compulsory sugar plantations over 12 years.
Individuals established plantation estates in outer islands for cultivation, transforming the
islands. Crop cultivation and plantations led to increased export production. Tin, coal, iron and oil
industries developed and the Indonesian economy became export-oriented, leading to many
foreign investments. Land leased to private investors, combined with smallholdings’ great
production, led to many Asians leasing land to grow rubber to supplement traditional livelihood.
Hence, locals benefited economically under Dutch rule.

Politically, there were nearly all demerits as the local people were exploited and had no say in running
their government. When Dutch wanted to sign a treaty recognising Dutch sovereignty over Aceh, a
general revolt broke out. When Dutch tried to set up a civil government in Aceh, a holy war broke out
against the Dutch. Economically and socially, it brought about benefits. There was technological
advancement in agriculture in terms of machinery to exploit resources and build modern
communication and transport lines to bring a better standard of living for the people. The Dutch had
the money and technology the locals did not have to exploit the resources and raw materials in their
countries.