From Indonesian Heritage: Ancient History page 52:

The earliest inscriptions discovered in Indonesia are written not in a local language but in Sanskrit. Sanskrit was the ancient language of learning throughout India, used mainly by scholars and religious specialists. The local Indian languages, such as Tamil, appear to have made little impact in Indonesia. This suggests that hte process of adoption of Indian cultural elements proceeded mainly as a conscious intellectual exercise rather than through frequent contact at the middle level of society, between such groups as merchants or warriors.

The same book also says that Java is mentioned in the Ramayana as Yavadvipa.

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