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Most of these conversions were peaceful—the Sufi doctrine offering a theologically smooth transition for the Hinduized kingdoms—but Majapahit, past its prime, fell by force to the neighboring Islamic kingdom of Demak in the early 16th century.

This was also about the time the Portuguese, seeking spices, arrived in the archipelago, conquering Malacca in 1511. Soon after, the Spanish and English also sought Indonesia's valuable spices, but it was a century later that Holland, newly independent of the Holy Roman Empire, ruled from Spain, succeeded in controlling the market in cloves, nutmeg and pepper. During much of the 17th and 18th centuries, the Dutch East India Company held a virtual monopoly.

The company went broke in 1799, and in the 19th century, the Dutch concentrated their colonial efforts on Java, leading to a huge increase in the population of this island.

During World War II, the Japanese quickly swept through the Dutch Indies, evicting the colonialists in 1942. At the end of the war, Indonesian nationalist leaders declared independence—on August 17, 1945—but it took four more years to oust the Dutch. Irian Jaya, the western part of New Guinea, was transferred to Indonesia in the 1960s; the former Portuguese colony of East Timor was annexed in 1976.