Why does Indonesia have so many political parties?

There are several factors which have caused the large number of political parties in Indonesia.

Firstly, some parties are based on particular sections of society, and thus several parties have emerged that represent these sections of society.

Secondly, Indonesia is a relatively new democracy, and hence there was much excitement post-1998 about creating and joining political parties. There has also been less time for particular parties to consolidate and become more powerful.

Thirdly, political parties are the only way to get into parliament or to become President, so a number of powerful figures have created their own political parties to seek more political power.

And Lastly, but most importantly, Indonesia has a Proportional Representation (PR) electoral system, which presents lower barriers for parties to gain seats than Single Member District (SMD) electoral systems. If Indonesia used SMD then there would likely be a significant reduction in the number of parties.