Anndy Lian, a Singapore-based adviser to governments on blockchain and information technology, said a successful digital collaboration between India and Indonesia could serve as a “massive proof of concept for the Global South, particularly within Asean”.

“Many developing nations are actively seeking alternatives to expensive, proprietary Western financial networks or heavily centralised systems,” he said.

“By demonstrating that scalable, open-protocol digital ecosystems can be successfully adapted across borders, India and Indonesia are establishing a highly attractive sovereign blueprint for digital transformation.”

Indonesia has formally set a target to become a global digital economic leader by 2045, aligning with its centennial milestone.

Lian cautioned, however, that a collaboration between India and Indonesia would require incorporating safeguards because adopting systems across different regulatory environments carried risks such as data privacy breaches and cybersecurity vulnerabilities.

“Second, there is the risk of ‘model mismatch’. India’s solutions are tailored to its specific demographic and bureaucratic realities, which may not translate perfectly to other nations without rigorous localisation,” he added.

Over-reliance on a single foreign partner for core digital infrastructure could also raise long-term “technological sovereignty concerns”, Lian said, urging countries to carefully balance digital efficiency with technological independence.

UPI has anchored a digital revolution in India that has helped bring large sections of its teeming population into a formal economy. Indian nationals can now access a range of welfare programmes through digital infrastructure, including the sharing of medical records.

Lian said India could leverage its digital initiative across Asia as it would enable millions of Indian tourists to make payments when visiting countries such as Indonesia, and also create a financial pipeline for Indian businesses and investors operating in Southeast Asia.

“Geopolitically, this elevates India from a participant in the global digital economy to a primary architect of its infrastructure. This is not merely about payments; it is a vector for exporting India’s broader tech ecosystem,” he said.

India’s digital services have expanded beyond its traditional bread-and-butter IT ones in the last five to six years to include fintech start-ups, cybersecurity firms and other enterprises.

“Beijing will undoubtedly view the India-Indonesia digital alignment as a strategic encroachment on its sphere of technological influence,” Lian said.

“India’s digital diplomacy is undeniably strengthening as it pivots from merely exporting technology to providing comprehensive governance blueprints.”

By sharing foundational digital frameworks like UPI and Aadhaar, a national digital identity base, India could offer peer-tested solutions, he said.

Jamus Lim, an associate professor of economics at the ESSEC Business School, noted that many back-end systems in the region already relied on Indian technical expertise.

“There are natural network effects that will reward first movers that establish the industry standard,” he said, adding that the faster India was able to roll out agreements using its standards, the better its position would be for South-South partnerships and agreements.

Raj Kapoor, president of India Blockchain Alliance, said leveraging its digital public infrastructure had become “arguably India’s most distinctive soft-power asset right now, because it’s cheap to export and it plays well as South-South solidarity”.

“Historically, countries exported infrastructure through roads, ports and power plants. Today, nations increasingly export digital infrastructure. India is emerging as one of the few countries capable of exporting an entire governance,” he said.

India should see collaboration in UPI “not as the destination, but as the opening chapter”, Kapoor said.

“We should use Indonesia as the flagship Asean case study to accelerate parallel talks with Vietnam, the Philippines, and others as first-mover advantage matters in standards-setting.”