Joshua Oppenheimer’s disturbing documentary about the 1965 Indonesian genocide and its legacy, The Act of Killing, has been winning awards (including a Bafta) and generating debate around the world for over a year. And on Sunday it was among the Oscar nominees.

The film — which because of security fears was initially shown only to invited audiences at hush-hush screenings — has already given the mainstream Indonesian media the courage to talk more openly about the murder of up to a million suspected Communists following a military coup that brought in the brutal Suharto regime.

However, until The Act of Killing’s Oscar nomination, the government had made no comment on the documentary.“They had been silent on the film since it came out, I guess hoping that it would sort of go away. Finally, the president’s spokesman for international affairs spoke up and said: ‘Look, we understand that the killings of 1965 were a crime against humanity and we will deal with them in our own time. We will have reconciliation in our own time. We don’t need a film to push us to do this.’”

Although “not a sign of goodwill” towards The Act of Killing, the statement was significant because “it was was an absolute about-face for the government,” Oppenheimer says. “Until that moment they had always maintained that the killings were something heroic.”

To this day, the murderers — many of them thugs and gangsters brought in to do the military’s dirty work — are lionised. In schools, the genocide is taught as a glorious victory over Communism. Just recently, Indonesia’s president made his father-in-law a national hero for his role in masterminding the killings. In such a climate, the survivors, who still suffer the economic hardship stemming from decades of political apartheid, continue to be terrorised.

Oppenheimer’s past primed him for the task of exposing the truth. His father and step-mother both lost family in the Holocaust and growing up, the Nazi genocide informed his world “like this dark matter, this enormous vortex, this black hole that exerted a tremendous force over all moral, political and cultural discussion in my family”.

Arriving in the plantation belt outside Medan, the capital of North Sumatra, to investigate the effects of globalisation, he “had this awful feeling that I had wandered into Germany 40 years after the Holocaust, only to find the Nazis still in power”. He attempted to film survivors but “they were too scared to say what had happened to them, because the killers were living all around them”. They told him to film the perpetrators instead.

And in a country where, unlike in post-war Germany, the killers were celebrated, they were only too happy to talk about what they had done — and in grisly detail.

Oppenheimer felt a forensic responsibility to document an unseen crime against humanity, but also a duty to “expose this whole regime of what happens when the killers win and remain in power and build a whole political and economic system on the basis of their victory, and on top of mass graves. I knew that given my family’s history, I had to spend as many years of my life as it would take to address this.”

He takes viewers deep inside the minds of an aged former death squad leader, Anwar Congo, another killer, Adi Zulkadry, and Herman Koto, a pony-tailed thug who comically tries to enter politics because of the opportunities it offers for extortion.

Controversially, Oppenheimer asks them to recreate their crimes in the style of the Hollywood films that they love. They comply with chilling enthusiasm. The filmmaker says he was not trying to recreate the past. “It’s not the task of cinema to create an image of what an unimaginable horror was like because the horror should be unimaginable,” he argues. Instead, the re-enactments are “acting out the fantasies that Anwar clings to in the present, and the perpetrators and the regime as a whole have clung to, in order to justify what they have done”.

By the end of the documentary, these lies and fantasies lay exposed and even Congo begins to look back with horror on the reality of what he has done. The film also achieves Oppenheimer’s aim of forcing the viewer to “acknowledge the rotten heart of the regime that the killers have built”.

The regime was constructed with the support or encouragement of countries such as America — which had a vested interest in seeing Communism defeated in Indonesia — and the UK, which under Margaret Thatcher, Oppenheimer claims, was the largest supplier of arms to the Suharto regime. He hopes the film will “lead to a broader discussion in the US, and a little bit in the UK, about our role in these crimes”.

He is in discussion with the Shoah archive at USC (University of Southern California) about making a lot of the filmed material he gathered before meeting Congo available to historians. He is also finishing work on his next documentary, The Look of Silence, about a family of survivors who find out who killed their son. “The film is really turning into a poem about a silence born both of terror and necessity, but also the trauma that comes with breaking that silence,” he says. “I don’t see it as a sequel or a follow up to The Act of Killing. They are companion pieces and I hope the whole will be greater than the sum of the two parts.”

The Act of Killing is available on DVD and is screening at London’s ICA until March 23