JAKARTA, Indonesia — The House of Representatives met Monday evening to debate a revised budget that includes a highly contentious increase in the price of subsidized gasoline, which drew thousands of protesters into the streets of the capital.
The government of President Susilo Bambang Yudhoyono wants to raise gasoline prices 44 percent, from 45 cents to 66 cents a liter, to help close a widening budget deficit. The country’s Finance Ministry has said spending on fuel subsidies could reach $23 billion in 2013, compared with about $20 billion last year, if urgent action is not taken.
Amid heavy rain, protesters including members of labor groups — the Jakarta police estimated as many as 4,000 — staged rallies and burned tires Monday outside the national legislative complex in south Jakarta to voice opposition to any price increases.
The police said they had deployed nearly 20,000 officers to maintain order, given violent protests that had erupted during past fuel price debates.
Demonstrations by students and other groups were also reported in other cities around Indonesia.
International lenders such as the World Bank have urged the government to eliminate subsidies altogether, as savings could go to crucial social programs, including health care, as well as much-needed infrastructure investment.
However, with national legislative elections scheduled for April 2014 and a presidential election three months later, fuel subsidies are a hot-button political issue.
Indonesian lawmakers may have to put politics aside, however, if they want to avoid harming one of Asia’s best-performing economies.