Danantara's Strategy to Reduce Import Dependency

The industrial sector in Indonesia does not always have to rely on imports, according to Danantara’s Chief Technology Officer, Sigit Puji Santosa. This is particularly true given volatility, currency exchange fluctuations, and extraordinary global conditions.

“So I think it is impossible for us to continue importing. Import substitution does not mean we have to displace others, no. But we are ensuring that we can have resilience in the industries we build, especially the defence industry, and also for the continuity and sustainability of the products and industries we develop,” he said during Mindialogue 2026: Minerals for Indonesia’s Economic Stability in Jakarta on Wednesday (12/8/2026).

Sigit cited the defence industry as an example, where there is an extraordinary need for ammunition propellant or filler materials. The number of producers is quite limited, and when there is a large demand, supply can only be fulfilled several years later.

“But thank God we conducted R&D together with the government and partners, we carried out certification, NATO standards have been met, and most importantly, the materials are all from Indonesia, 100%. So once we were able to do this, we are now scaling up from 10 tonnes to 70 tonnes to 1,000 tonnes. If we can fulfil the filler requirement at 1,000 tonnes, we understand we can export later when we need to reach up to 2,300 tonnes,” Sigit detailed.

Therefore, Sigit asserted that reducing import dependency is very possible. For example, Indonesian human resources can collaborate with the best sources available. He confirmed that the government is very supportive of this.

Previously, Sigit also invited the Indonesian public to be grateful for the country’s extraordinary natural wealth. It is therefore very important for Indonesia to manage these natural resources and provide more optimal added value, one of which is achieved through downstream processing.

Danantara itself, he continued, has an aggressive strategy to ensure downstream processing runs well. One approach is to carry out a comprehensive integration process from upstream to downstream. This step is crucial so that production and distribution are not interrupted.

“During the 1970s and 1980s, our mineral activities were mostly extractive. On the downstream side, we were only positioned where production and industry for assembly had a missing link in the middle. So Danantara, in order to build a sustainable industry, will build a sustainable industry from upstream all the way to downstream,” he explained.

As is known, the considerable challenge in utilising natural resources has largely pointed towards the extractive industry, given that technology and human resources were not yet adequate. Furthermore, the investment required is not insignificant. Fortunately, Indonesia now has Danantara. The substantial investment needs to drive the downstream processing programme can be met.

“So the investment challenge is not a problem anymore,” he concluded.