How borders are drawn and enforced has far-reaching consequences, whether we live on either side of them or halfway across the world.

Sometimes it’s easy to forget that Bali is a part of Indonesia. The “island of the gods” is mostly Hindu, unlike the rest of the predominantly Muslim nation, and has a distinctive culture, luring travelers who bring along French wine, global sensibilities, and the latest design trends. For visitors, it can seem like a magical world unto its own—David Bowie requested that his ashes be scattered there.

But Bali is part of Indonesia, and Indonesian law stipulates that marriage is between a male and female. So when pictures of what appeared to be a same-sex marriage on the island spread on Facebook and then into the news last September, it caused an uproar.

The “wedding,” between American and Indonesian men, turned out to be a private symbolic ceremony. (They married legally in the US, to which they soon returned.)

But local officials went on what some called a “witch hunt,” searching for the individuals who helped set up the ceremony. The Four Seasons sales executive who arranged the “karma cleansing” ceremony was charged with religious blasphemy. She pleaded guilty (link in Indonesian) and could spend up to five years in jail (pdf).

The incident is just one example of the increasingly harsh anti-gay sentiment that is rising throughout Indonesia. In the rest of the country the sentiment has forced multinational companies to change how they do business, and some gay citizens into hiding. In Bali, by far the country’s most popular tourist destination, this rise threatens the very foundations of the local economy, one that’s a major contributor to the roughly $80 billion a year (pdf) Indonesia earns from tourism.

A gay tourism mecca

September’s “wedding” was hardly the only same-sex ceremony ever held on the island. Bali is incredibly popular among gay travelers and has one of the most robust gay nightlife scenes in Asia, complete with a rowdy gay bar district, and legions of drag shows and go-go dancers. It’s “not only the gay oasis of this very conservative country, but also a popular gay destination in the world,” wrote Stefan Arestis in Nomadic Boys, a gay couple’s account of traveling across Asia.

Bali is one of the top 10 LGBT destinations in Asia-Pacific and Middle East, according to Out Now, a marketing and research firm based in Holland, and many of these travelers spend thousands of dollars per trip. The September ceremony above, for instance, was held at the pricey Four Seasons Sayan resort in the lush Ubud area. Rates range from $320 per night for a one-bedroom duplex to more than $2,000 for a two-bedroom villa facing a river.

Four Seasons

As anti-gay sentiment rises in Indonesia, officials in Bali need to decide whether to ban LGBT travel “altogether while accepting financial consequences of such a decision,” Bali Discovery Tours wrote last month, or set enforceable limits on the scope of LGBT businesses in Bali. “The ‘pink’ elephant in the room is a thriving LGBT business sector in Bali that provides employment, pays taxes, and helps to fill hotels rooms with well-heeled, high-spending travelers,” the travel agency said.

As Bali Discovery Tours notes, “the global LGBT travel market is estimated to have an annual value of around $200 billion—a figure arguably more than the much-coveted mainland Chinese travel market.”

Growing intolerance

Homosexuality is not illegal in Indonesia, and statistically it has one of the world’s largest gay populations, since it has the fourth-biggest population overall. The nation’s gays have even developed their own language.

Not that they can feel too comfortable. When asked if he was out to his family and colleagues, a gay man interviewed by Nomadic Boys said: “My family do not know, and very few of my friends do. In our Muslim community it’s not something you can easily admit to anyone. Homosexuality is perceived as a sin, so you technically cannot be a Muslim and gay at the same time.”

Recently the nation’s top Muslim clerical body called for legislation banning LGBT activities nationwide, and mandatory rehabilitation services for those inclined toward what it considers deviant sexual behavior.

Muslim hardliners showed their influence recently when they helped persuade the government to request that Line, a Japanese messaging app, remove LGBT-themed virtual stickers from its Indonesian-language store. The company quickly complied, and now the government is requesting that Facebook and WhatsApp remove LGBT emoji.

Gay travelers take into consideration how the local LGBT community is treated when planning trips. Out Now notes that one of Bali’s key inbound tourism markets is Australia, which the firm estimates has 1.1 million LGBT people. In a 2014 survey the firm asked LGBT travelers in Australia: “When you choose where to travel, to what extent can the legal situation for local LGBTI [lesbian, gay, bisexual, transgender, and intersex] people affect where you decide to go to spend your holiday/vacation?”

Most cared about such things:

Gay travelers’ response Percent To a great extent—I always try to avoid places that treat LGBTI people poorly 37 To a moderate extent—I am motivated to holiday in places where LGBTI people are well-respected but there are some places I want to go where I have to make an exception 35 To a small extent—it is not usually a factor that I consider when I choose where to holiday 22 Not at all—it is irrelevant to me what the local laws on LGBTI rights are 6

But it isn’t just gay travelers themselves who may shun Indonesia. It’s also what Out Now calls their “allies,” or those who know LGBT people and are supportive of their right to have genuine equality in society. In the firm’s 2014 survey of LGBT people in Australia, participants counted, on median, eight family members and seven coworkers as “allies.”

And they might now be thinking twice about Indonesia, Out Now CEO Ian Johnson told Quartz in an email:

LGBT people also have millions of family members, friends, and work colleagues—known as Allies—who love and support them. Many of those people can be expected to prefer to holiday somewhere other than an unwelcoming destination, should a destination appear to stand against respect for LGBT people. In many major travel markets—such as Australia, USA, and Europe—the tipping point is passed and far more people now support LGBT people than stand against them. It is from sources like these that inbound tourism risks being affected, should people decide to boycott travel to a destination as a result of anti-LGBT political and social issues.

He added, “You can start to see that the potential impacts on tourism to Bali from Australia can have much greater impacts than the 6% of the travel market who are themselves LGBT.”

So far, Indonesia’s anti-gay sentiment hasn’t hit the tourism industry. The country beat its humble 2015 target of 10 million foreign tourist arrivals, by 400,000. Terminating pesky visa-on-arrival requirements for visitors from dozens of countries in a bid to boost tourism may have helped. But that is still well short of Thailand’s nearly 30 million visitors in 2015. Even tiny Singapore passed the 10 million mark—way back in 2006.

And once again, Bali was a driving force. The gay mecca in the conservative country had over 4 million foreign visitors last year.