Republic of Indonesia, island republic of Southeast Asia, constituting most of the Malay Archipelago. Indonesia is the world’s fourth most populous country after China, India, and the United States. More than half the people live on Java, where Jakarta, Indonesia’s capital and largest city, is located. Although the islands are home to more than 100 ethnic groups, most Indonesians are of mixed Malay origins and practice Islam.

Several of Indonesia’s islands hosted powerful trading kingdoms between the 5th and 16th centuries ad. The Dutch took control of the islands in the early 1600s and for three centuries profited from Indonesia’s economy, largely at the expense of the local population. Dutch authority over the islands peaked in the early 20th century. But growing Indonesian nationalism led to a declaration of independence in 1945, and the Dutch finally transferred sovereignty in 1949. The country enjoyed tremendous economic growth in the 1980s and much of the 1990s, partly due to Indonesia’s abundant natural resources and increases in the manufacturing and services sectors. As a result, Indonesia’s middle class grew considerably, but poverty remained widespread. Indonesia plunged into an economic crisis in 1997 that led to significant political changes, including the resignation of President Suharto, who had been in office for more than 30 years. Democratic elections held in 1999 installed a new government.