BKPM Unveils Strategy to Attract Industrial Investment

Bisnis.com, JAKARTA — The Ministry of Investment/BKPM has prepared several strategies to attract industrial sector investment, which is expected to create more jobs and integrate Indonesia into global supply chains. Deputy for Investment Climate Development at the Ministry of Investment/BKPM, Riyatno, stated that the government is prioritising end-to-end services, from promotion, licensing, to approaching the banking sector for funding. “If there are obstacles during the licensing process or even after operations begin, we will facilitate,” he said at the Bisnis Indonesia Forum (BIF) at Bisnis Indonesia’s office in Jakarta on Monday (25/5/2026). He added that the government continues to coordinate with ministries, agencies, and local governments to ensure investment processes run more efficiently and provide certainty for investors. Riyatno explained that a key focus of the government is reforming the licensing system through the Online Single Submission (OSS). The system is designed to minimise direct face-to-face interactions between business actors and officials to curb rent-seeking practices. “How we create a business licensing system that doesn’t require meeting people, operates 24/7 via the system. Even handling permits via smartphone,” he explained. Riyatno acknowledged that OSS implementation still faces challenges, particularly due to the need to integrate with other ministries’ platforms such as Gistaru from the Ministry of Agrarian Affairs and Spatial Planning (ATR/BPN) and Amdalnet from the Ministry of Environment and Forestry. However, the government is continuously refining the system, including implementing a ‘fictitious positive’ mechanism. Under this scheme, business permits are automatically issued if ministries or agencies fail to respond within the service deadline. “If incomplete, it is returned via the system with a note of deficiencies. But if the service level agreement (SLA) is exceeded, the OSS system will automatically issue the permit,” he clarified. He added that risk-based licensing is part of investment reforms. For low and medium-low risk businesses, licensing only requires a Business Identification Number (NIB) and self-declaration-based standard certificates. Meanwhile, medium-high and high-risk businesses still undergo verification by relevant technical ministries. In addition to licensing reforms, BKPM is intensifying investment promotion through collaboration with ministries, agencies, and Indonesian overseas representations. The government has nine overseas investment offices tasked with directly engaging global investors. Downstreaming remains a top priority for attracting foreign investment. Riyatno said investment promotion strategies will focus on sectors based on domestic natural resources with high added value. “So we are offering or promoting downstreaming based on the resources we have the most of. Starting from nickel, bauxite, palm oil, then coconuts, and so on,” he said. The government recorded investment realisation of Rp498.8 trillion in the first half of 2026, a 24.4% year-on-year increase. This figure is nearly a quarter of the national investment target of Rp2,041.3 trillion for this year. Riyatno noted that investment’s contribution to economic growth has grown amid Indonesia’s 5.51% economic expansion. Additionally, the composition of foreign direct investment (FDI) and domestic investment (PMDN) is relatively balanced, with FDI at 50.1% and PMDN at 49.9%. He added that investments outside Java are also rising alongside downstreaming development and industrial zone construction in various regions. “This shows that investment growth is not only concentrated in Java,” he said. Sectorally, domestic investment in manufacturing between 2020 and 2025 increased 2.6 times from Rp19 trillion to Rp48.7 trillion. Meanwhile, total national investment realisation grew over 2.3 times from Rp826 trillion in 2020 to Rp1,901 trillion in 2025. The dominant manufacturing sectors for investment include basic metals and metal products, food and beverages, chemicals and pharmaceuticals, as well as motor vehicles and transportation.