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Muslim women at a mosque in Jakarta, Indonesia, perform an evening prayer called ‘tarawih,’ marking the first eve of the holy fasting month of Ramadan, in April, 2022Dita Alangkara/The Associated Press

Michael Vatikiotis is an American writer, journalist and private diplomat working in Southeast Asia since 1987.

A new criminal code approved by Indonesia’s parliament in December has made headlines around the world. It will make consensual sex or cohabitation outside of marriage a criminal offence. Leaving a religion and insulting the president will also be banned.

Liberal critics are worried that when the set of laws comes into force in 2025, Indonesia could become a religious state and return to authoritarian rule. What does the new code reveal about the world’s fourth most populous country, and what will its impact be?

Indonesia will soon mark a quarter-century of sustained democratic government. In that space of time, the country has had five presidents, who all yielded to their successors peacefully, and the last two of whom were directly elected. By almost any measure, Indonesia’s democratic transition is a success story.

Yet for the past few years, there have been worrying signs of stagnation and regression: Media freedoms have been challenged, systemic corruption has been unchecked and discriminatory practices have been tolerated. The U.S. liberties watchdog, Freedom House, last year judged that Indonesia was only “partly free.”

Unlike many countries where democratic transitions floundered because of poor leadership and bad government, however, Indonesia for the past decade has been tolerably well led and governed. Social and economic policy making has been largely steered by technocrats, and a whole range of indicators – from economic growth and income distribution, to education and public health – provide a degree of security and equity for its citizens that similar-sized countries, such as Nigeria, can only dream of.

In fact, the roots of democratic decay in Indonesia can be traced to unresolved aspects of the country’s founding at the end of the colonial era, paradoxes of identity that persist today: a modern republic framed by liberal principles of statehood, yet pulled socially and culturally in conservative directions. These tensions and contradictions have been thrown into sharp relief by the framing of a new criminal code described by one former minister, Rizal Ramli, as “the preamble for future presidents to abuse power,” which could bring Indonesia firmly back into an authoritarian era.

Liberal critics such as Mr. Ramli worry about the extent to which the new penal code asserts the primacy of religion in society, and casts criticism and protest against authority as a criminal offence. More explicitly, argues veteran Indonesian human-rights campaigner Andreas Harsono, the code could promote crime and corruption.

“Indonesia’s new criminal code contains oppressive and vague provisions that open the door to invasions of privacy and selective enforcement that will enable the police to extort bribes, lawmakers to harass political opponents, and officials to jail ordinary bloggers,” Mr. Harsono said in a statement made by the U.S.-based organization Human Rights Watch. This is all seen as a threat to the liberal foundations of the Indonesian state.

Indonesia declared independence in 1945. Its founding fathers, most of whom were Dutch-educated, envisioned a modern republic embodying principles of democracy and pluralism. They faced two immediate challenges: The first was how to reconcile Islam, the religion of the majority, with a significant array of non-Muslim minorities; the second was how to mesh the haughty Hindu-Buddhist traditions of Javanese kingship that constitute the basis of traditional political culture with modern statehood.

Arguably, for the next four decades, the fledgling republic struggled to cope: Islamic forces rebelled early on and threatened national unity, and the repressive measures used to suppress such resistance formed the basis of a more autocratic form of government that drew on traditional precepts of Javanese kingship. The result was the suffocatingly repressive New Order era led by Suharto, whose downfall in 1998 heralded democratic reforms.

Embedded in the new penal code are markers that revive these old challenges to liberal democracy in Indonesia – specifically by empowering Islamic conservatives to codify aspects of religious belief, and conceding to nationalists the means to wield power with impunity.

Indonesia’s slide toward Islamic orthodoxy has certainly been evident for some years now. Initially fuelled by money and Salafist dogma from Saudi Arabia, Indonesian Muslims have progressively embraced a more conservative interpretation of their faith. Visions of Islamic statehood, once a fringe debate, now pervade political agendas. In the 2019 election, opposition to President Joko Widodo, himself a Muslim, rallied around the Islamist agenda. Mr. Widodo, popularly known as Jokowi, won, but the opposition did surprisingly well – defining sizable areas of Sumatra and West Java as Islamist.

This makes it hard for Mr. Widodo to ignore the Islamist agenda. Under his watch, courts and local authorities have permitted the passage of Islamic bylaws forcing girls to wear hijabs in schools.

At the same time, the success of his presidency – he maintains a 70-per-cent approval rating after more than eight years in power – has reinforced support for traditional Javanese political culture by which a successful leader becomes immune to criticism. The provisions in the new code that restrict expressions of political dissent will please Javanese traditionalists, who have long recoiled from the idea that ordinary Indonesians can question legitimate authority.

Consciously or not, Mr. Widodo may be part of the problem. He has struggled to dispel rumours that he may seek to extend his time in office beyond the currently mandated two terms. Many people in his inner circle simply can’t imagine their boss stepping down after two terms; they may be looking for ways to constrain critics and pave the way for presidential decrees to postpone elections that are supposed to take place in 2024, something the new criminal code is expected to help them to do.

So despite the obvious threat the criminal code poses to Indonesia’s democracy, there are pervasive social and political undercurrents that suggest this isn’t some ghastly apparition that will be swept away by a renewed push for reform before it comes into force in three years.

Seen in a broader international context, Indonesia today is charting a course as a confident medium-sized power that cherishes the principles underpinning its evolution as a nation. Democracy and respect for human rights are just two of them. Being one of the largest Muslim countries in the world is another. Indonesians also want their leaders to be strong and effective, so they are willing to tolerate a degree of protection for their authority.

Liberal critics say this is a dangerous path. What is to stop Indonesia becoming more like Iran if religion is not subjugated to civil law? And what precedent does it set for the future if the executive presidency is cordoned off from criticism and permitted indefinite extensions of tenure?

Ultimately, a society as diverse and complex as Indonesia is sure to embrace contradictions, just as the United States does – consider the country’s debate over abortion. The hope for more progressive Indonesians is that the country’s foundational DNA, steeped in the liberal nationalism of anti-colonial struggle, will prevail.

This much was evident at the end of Suharto’s autocratic rule, when the military had a chance to step in and didn’t – when those strands of that DNA were recovered to design a political system that enfranchised all Indonesians to elect their president and set up agencies to crack down on corruption. It was also very evident when Mr. Widodo declared, barely a month after the passing of the criminal code, that the state was responsible for serious human-rights abuses going back to 1965. These civic impulses are strong, even if the country continues to wrestle with divergent strands of cultural identity.