Indonesia’s push for Grab-GoTo merger driven by politics, say analysts

Govt said to be wary of ‘ojek online’ riders’ influence, given their role in August protests

- Wahyudi Soeriaatmadja Indonesia Correspondent

Indonesia is pushing for a possible merger between Grab and GoTo, Southeast Asia’s two biggest ride-hailing firms, in a move that analysts say is driven more by politics than commercial consideration.

With some seven million ride hailing drivers forming a powerful and increasingly vocal workforce, President Prabowo Subianto appears keen to bring the sector under tighter control.

New rules are being drafted to grant benefits such as health insurance to active drivers, effectively treating them as permanent employees. This would potentially sideline less active drivers and trigger the natural attrition of drivers, which would give the government greater oversight of the industry.

The government has grown increasingly wary of the political clout of ojol - short for “ojek online” - riders, who played an active role in the August mass street protests against parliamentary perks, a Transport Ministry official told The Straits Times on the condition of anonymity.

Mr Muhammad Nalar Al Khair, an economist with Jakarta-based think-tank Sigmaphi Research, said: “There are indications that the government is seeking to curb the influence of a group with a very large membership. This is an anticipatory move following the large-scale protest in August.”

In August, thousands of students, rights groups and other civilians joined protests against the government’s spending priorities, including pay rises for lawmakers.