The Indonesian government is actively courting Chinese investors to expand the nation’s data center and artificial intelligence infrastructure.
Indonesia Pitches Digital Infrastructure and Data Center Sector to Chinese Firms
According to Ministry Deputy for Investment Services Andi Maulana, the rapid development of data centers represents a highly promising investment opportunity driven by Indonesia’s status as one of the fastest-growing digital economies in Southeast Asia. Citing Mordor Intelligence data presented by the ministry, Indonesia’s data center market size reached approximately US$1.44 billion in 2025 and is projected to climb to US$1.83 billion in 2026. This trajectory is expected to scale further to US$3.48 billion by 2031, reflecting a compound annual growth rate (CAGR) of 13.71 percent.
Nationwide digital economic prospects align with broader macroeconomic goals. Indonesia’s digital economy gross merchandise value (GMV) is forecast to hit between US$180 billion and US$340 billion by 2030, transitioning from a supportive sector into a primary driver of national economic transformation. Officials attribute this momentum to a mobile-first young demographic, expanding internet access, and pro-innovation public policies.
Banten Prepares for Influx of Tech Investments
Regional governments are positioning themselves to absorb the incoming technology capital. The Banten Provincial Government has formally announced its readiness to accommodate artificial intelligence and data center investments from China, following a strategic visit by Hexavia CEO Qimeng Sun.
Our Beijing counterpart is planning to build a data center in Indonesia. Banten is considered very strategic due to its adequate infrastructure support,
Banten Governor Andra Soni stated. Soni emphasized that Banten offers a reliable electricity supply, abundant water resources, and close proximity to Jakarta, an international airport, and an extensive toll road network. The governor also noted that the technology influx supports President Prabowo Subianto’s downstreaming priorities, which aim to boost job creation and labor absorption.
Head of the Banten Province Investment and One-Stop Integrated Services Agency (DPMPTSP) Virgojanti noted that investor interest has surged across several strategic locations, including Cileles in Lebak District, the Education, Technology and International Health Special Economic Zone (KEK ETKI) in BSD, Cikupa, and Serang. Local authorities acknowledge that developing a highly skilled technology workforce remains a key operational challenge and opportunity for the region.
Batam Transforms into a Technology and IT Hub
Further demonstrating the nationwide shift toward digital infrastructure, the city of Batam is rapidly evolving from a conventional manufacturing and industrial base into a hub for information technology and data centers. Batam Mayor Amsakar Achmad highlighted this structural pivot during a power purchase agreement signing between PT PLN Batam and PT Altiva Identity Data Center at the Tanjung Kasam Auditorium.
Investment momentum in Batam is mirrored in macroeconomic data.
Regulatory Reforms and Incentives for Foreign Partners
Bilateral economic ties remain robust. Data from the Ministry of Investment and Downstreaming/BKPM indicates that total investment realization from China reached US$38.34 billion between 2021 and the first semester of 2026, generating more than 500,000 jobs nationwide. Furthermore, Indonesian Chamber of Commerce and Industry (Kadin) General Chairman Anindya Novyan Bakrie reported that bilateral trade between Indonesia and China reached US$100 billion in the first half of 2026 alone, yielding a trade surplus of US$5.8 billion for Indonesia.
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