Danantara and INA to Invest USD 200 Million in Strategic Chemical Plant in Cilegon

JAKARTA — The synergy between state investment managers and the domestic petrochemical industry has been further strengthened. Danantara Indonesia and Indonesia Investment Authority (INA) have officially signed a Conditional Share Subscription Agreement (CSSA) with Chandra Asri Group for the development of a Chlor Alkali–Ethylene Dichloride (CA-EDC) plant in Cilegon, Banten. This agreement represents a capital commitment phase following the signing of a memorandum of understanding (MoU) by all three parties.

Under the agreed investment structure, Danantara and INA will invest a combined USD 200 million from the total project value of USD 800 million. The project has been designated as part of the National Strategic Project (PSN) aimed at strengthening upstream and downstream industries based on essential chemical raw materials.

The CA-EDC plant, which will be operated by PT Chandra Asri Alkali (CAA), is targeted to begin operations in 2027. In the first phase, production capacity is designed to reach 400,000 tonnes of dry caustic soda per year and 500,000 tonnes of ethylene dichloride (EDC).

Caustic soda is an important raw material for the soap and detergent industries, alumina refining, and paper production. EDC, meanwhile, is a key raw material in the construction and packaging industries.

The investment is projected to reduce dependence on imports of strategic chemicals, which currently remains high. In addition to strengthening domestic supply security, EDC production also has potential to create export opportunities and increase national foreign exchange earnings.

Pandu Sjahrir, Chief Investment Officer of Danantara Indonesia, stated that this collaboration represents a concrete step in strengthening high-value-added industries.

“This is not merely a response to import dependence, but part of a strategy to accelerate downstream industrialisation, which is key to long-term economic growth,” Pandu said.