The early history of Aceh remains uncertain, but one tradition traces its origins to the Cham people.

The Acehnese language belongs to the Aceh-Chamic language group, which consists of ten related languages.

According to the Sejarah Melayu (Malay Annals), the Champa king Syah Pau Kubah had a son, Syah Pau Ling, who fled when the Vietnamese Lê dynasty sacked the Cham capital, Vijaya, in 1471. He is said to have later founded the Aceh kingdom.

By the mid-fifteenth century, the ruler of Aceh converts to Islam, marking a pivotal shift in the region’s history.

The Sultanate of Aceh is formally established in 1511 by Ali Mughayat Syah, who launches campaigns to extend his control over northern Sumatra beginning in 1520.

His conquests include Deli, Pedir, and Pasai, and he wages war against Aru, solidifying Aceh’s growing influence.

After the Portuguese occupation of Malacca in 1511, many Islamic traders navigating the Malacca Straits redirect their commerce to Banda Aceh, significantly enhancing the wealth and influence of the Acehnese rulers.

Throughout the seventeenth century, both indigenous and foreign powers in the Southeast Asian archipelago engage in a complex struggle for control over maritime trade.

The rapidly rising profits from this trade fuel the expansion of ambitious regional states, the most prominent being Aceh (northern Sumatra), Banten (western Java), Makassar (southern Sulawesi), and Mataram (central and eastern Java).

The most formidable external power in this contest is the Dutch-run United East Indies Company (VOC), whose influence steadily grows across the region.

Each indigenous state follows a distinct trajectory during this period, but the broader struggle unfolds between two competing trade models:

• A heavily state-controlled system, where rulers consolidate economic power, and
• A more oligarchic structure, where the orang kaya (merchant elite), often allied with religious and traditional leaders, maintain significant economic and political influence.

This dynamic battle for dominance over Southeast Asia’s lucrative trade networks reshapes the region’s political and economic landscape, setting the stage for future conflicts and transformations.

 

Conditions begin to change, however, during the disastrous reign of Sultan Agung's son, Amangkurat I (r. 1646-77), who lacks his father's talents but seeks to further strengthen the realm by centralizing authority, monopolizing control of resources, and destroying all real or imagined opposition.

His misguided efforts to control trade revenues by twice closing the ports of the Pasisir, and even destroying Javanese trading vessels and forbidding Javanese travel overseas, have the opposite effect, in addition to alienating the commercial community and damaging the wider economy of producers.

His obsessive fear of opposition leads him to kill more than five thousand Muslim leaders and their families in a single, well-planned massacre, and to murder hundreds of court officials and members of the aristocracy, including his own family, actions that of course only increase the hatred and intrigues aimed at removing him.

His attitude toward the VOC is ambivalent, for, on the one hand, he admires its apparent wealth and power and considers it a potential ally and protector, yet on the other hand he seeks to bend it to his will and to extract all he can from its representatives in Batavia.

Beginning in the early 1670s, rebellions begin to rise, the most powerful of which is led by Raden Trunajaya (ca. 1649-80), a Madurese aristocrat conspiring with a disaffected son of Amangkurat I and allied with Makassarese and other forces.

Trunajaya's armies win a decisive victory in 1676 and loot the capital the following year.

Mataram is disintegrating.

Both sides, in the course of this conflict, request assistance from the VOC, which now faces a momentous decision.

The company seeks political stability and a reliable supply of such key products as rice and teak, and it determines for the first time in more than a half-century that, in order to obtain them, intervention in Mataram's internal affairs is necessary.

Company officials view Javanese kingship through a European lens as a relatively absolutist, centralized form of rule that legitimates succession by, if not strict primogeniture, then something very close to it.

This is a misreading of Javanese (and, indeed, other Indonesian) cultural custom, but nonetheless the VOC gradually comes to see itself as the upholder of order (tradition) and to justify its actions in terms of favoring continuity rather than change.

It makes its choices accordingly, often with the ironic result of creating rather than solving discord and of weakening rather than strengthening the sorts of order it hoped to achieve.

In any case, the VOC decides in 1676 to back the forces of Amangkurat I, who dies soon after having fled to VOC-controlled territory on the Pasisir, and then to support his rebellious son as successor, a project requiring five more years of warfare to complete.

The company gains treaties promising, among other things, access to the products and trading rights it sought, as well as repayment of all its military costs.

That these treaty obligations prove difficult to fulfill does not negate the fact that the VOC has now embarked on a course that will slowly and expensively intertwine its own fate with that of Mataram.

The dark legacy of Amangkurat's tyrannical misrule thus lies not only in eighty years of turbulence in Javanese life, punctuated by three destructive wars of succession, but also in the establishment of patterns of Dutch entanglement in indigenous affairs that are to outlive the VOC itself.

A common historical perspective on the seventeenth and eighteenth centuries is to portray the VOC as a uniquely powerful military and economic juggernaut that steadily and deliberately constructed the empire that came to be known as the Netherlands East Indies

In the twentieth century, such a view was frequently shared by Dutch colonial officials and Indonesian nationalists, who spoke of "three hundred and fifty years of Dutch rule" in the archipelago.

The truth, however, is more modest.

The VOC was neither the "first (modern) multinational corporation," as has sometimes been claimed, nor the instrument of a state policy of colonial expansion.

It was founded in the Netherlands in 1602 as an effort to manage the competition and risk of the growing number of Dutch expeditions to the Indonesian archipelago (ten companies, ten voyages, and sixty-five ships between 1595 and 1601), and to compete with the East India Company, formed by the English two years earlier, for control of the Asian trade.

The VOC's initial charter establishes its sole right among Dutch enterprises to do business in Asia and gives it exceptional powers, such as those of keeping an army and using military force, making treaties with local rulers, building fortifications, and issuing coinage.

In addition, it calls for little government oversight and does not require the new company to pay dividends to investors at the end of each voyage (as had been the practice), allowing it to amass large sums of money over longer periods of time.

The purpose of this state-supported enterprise is primarily to make a profit.

At home the directors, known as the Heeren XVII (Seventeen Gentlemen), recognize that fighting wars, establishing colonies (rather than simple trading posts and fortifications), and becoming involved in local disputes diminishes profits, and they generally warn against such activities.

VOC representatives far away in the archipelago, appointed after 1610 as governors general, tend to see the warring and political involvement as necessary and pursue them anyway, often vigorously.

Even the more ambitious of their efforts, however, are restrained by certain realities.

Above all, the VOC is never big enough or strong enough to dominate the entire archipelago and its people, and indeed the company finds it impossible to enforce its will in local affairs without Indonesian allies, who frequently exact a high price for their assistance and whose loyalty can never be taken for granted.

It is also the case that even when it has its way—for example, by gaining control of specific trading ports or routes, or of the main areas in which particular spices are produced—interventions by the VOC often have unintended short- and long-term consequences that it can do little to control.

Finally, of course, the VOC's fortunes are subject to the vagaries of a trading system that stretches far beyond the archipelago, including the rise and fall in world demand for spices and, later, for other products on which it will come to depend, such as coffee.

In the course of nearly two centuries, the company will fail to control the spice trade and establish the stable conditions necessary for mercantile growth, and will come to rule over only minute patches of territory, except for small areas in Maluku in the seventeenth century and Java in the eighteenth.

The VOC nevertheless has a shaping influence in the archipelago.

In what today is eastern Indonesia, the company—with, it is important to reiterate, the help of indigenous allies—between 1610 and 1680 fundamentally alters the terms of the traditional spice trade by forcibly limiting the number of nutmeg and clove trees, ruthlessly controlling the populations that grow and prepare the spices for the market, and aggressively using treaties and military means to establish VOC hegemony in the trade.

One result of these policies, exacerbated by the late-seventeenth-century fall in the global demand for spices, is an overall decline in regional trade, an economic weakening that affects the VOC itself as well as indigenous states, and in many areas occasions a withdrawal from commercial activity.

Others are the rise of authoritarian rulers dependent on VOC support and unrest among groups—traditional leaders, merchants, religious and military figures—who oppose one or the other or both.

Among the most prominent examples are those found in the histories of Ternate in the time of Sultan Mandar (r. 1648-75) and the wars against Hitu and Hoamoal (1638-56), and of southern Sulawesi in the era of the ambitious Buginese (Bone) prince Arung Palakka (1634-96) and the wars against the Makassarese (Gowa) and others.

By the end of the seventeenth century, the glories of the spice trade have faded, and the vitality of the large and small states of the post-Majapahit era has been sapped; the weight of affairs has again begun to shift west, to Java.

The VOC had in 1619 seized Jayakerta (Sunda Kelapa), a small but well-protected west Javanese port it had originally contracted from a disgruntled vassal of the sultanate of Banten, renaming it Batavia, forerunner of today's Jakarta.

The resolute Governor General Jan Pieterszoon Coen (in office 1619-23 and 1627-29) had conceived of this port as a kind of fulcrum of the company's far-flung Asian enterprise, and he defends it vigorously against both Banten (allied briefly with England's East India Company) and, in 1628-29, the powerful land and sea forces of the expanding central Javanese state that had taken the name of Mataram, after the ninth-century kingdom.

Mataram's ruler, Sultan Agung (r. 1613-46), is Java's greatest warrior king since Kertanagara nearly four centuries earlier.

Using iron force and a keen sense of traditional diplomatic opportunities, Sultan Agung assembles a realm that consists of all of Java and Madura (including the powerful kingdom of Surabaya) except Banten in the far west and the Hindu-Buddhist kingdom of Blambangan in the far east.

Sukadana and Banjarmasin on Kalimantan also fall under his sway.

He is not, however, able to dislodge the VOC, and after the failed campaign of 1628-29 he appears to have accepted the Dutch presence as a minor irritant.

Contemporaneous Javanese historical works treat the company more as a potential ally than as a serious threat, a view that will persist among many in court circles for another century or more.

And, indeed, at the time the VOC is neither interested in nor capable of tackling the full force of Mataram, which, despite the destruction and political tensions wrought by nearly forty years of expansion, remains a formidable military power.

The company sees itself as a maritime power, a rival for the control of produce and trade rather than territory, and it seeks stable conditions for its activities rather than upheaval.

The ruthlessness of Iskandar Muda’s regime earns him many enemies and nearly ignites civil war.

Despite its economic prosperity, Aceh’s gains under his rule fail to bring lasting political or structural transformation. Instead, the orang kaya (merchant elite) reassert their influence, seeking ways to curtail royal power.

By the late seventeenth century, they successfully install a succession of female rulers, likely viewing them as either more moderate or easier to manipulate. However, by the eighteenth and nineteenth centuries, both the orang kaya and the royal court see their power wane, as hereditary district chiefs (uleebalang) and influential Muslim leaders rise in prominence. As a result, Aceh loses its imperial authority and much of its political cohesion.

Yet, unlike most of its regional counterparts, Aceh remains an important local power. Well into the nineteenth century, it continues to be a major economic force, producing over half of the world’s pepper supply as late as 1820.

Aceh also proves politically shrewd—it joins Dutch forces in 1641 in an attack on Portuguese Malacca, but in the following decades, it stands apart from other major states of the early modern archipelago. While others become entangled with the Dutch East India Company (VOC), Aceh alone among them manages to retain its independence until the late nineteenth century.