President Sukarno, the president of the United States of Indonesia, appointed Mohammad Hatta, Ida Anak Agung Gde Agung, Sri Sultan Hamengku Buwono IX and Sultan Hamid II to choose the cabinet of the new country.

Two days later, on 20 December 1949, the cabinet was sworn in, and a week later formally accepted the sovereignty of the nation from the Dutch.

In practice, Hatta had a very dominant position in the cabinet, due to his close relationship with Sukarno, his success at the Dutch–Indonesian Round Table Conference and his role during key events during the War of Independence.

Following a report from the attorney general, State Minister Sultan Hamid II was dismissed on 5 April 1950 for involvement in the rebellion led by Raymond Westerling.

On the same day, Prime Minister Hatta returned his mandate to President Sukarno.