From Nickel to Battery King: Indonesia's Strategy on the World Stage
Jakarta, CNBC Indonesia — Competition in the era of electric vehicles is intensifying. It is no longer merely about the ability to produce vehicle units; the world is also shifting towards mastery of the raw material supply chain through the downstreaming of nickel into EV batteries.
As the country with the world’s largest nickel reserves, Indonesia certainly has a great opportunity to become a major player in the electric vehicle battery supply chain. For this reason, the role of MIND ID has become increasingly strategic.
This is because, as the holding company for state-owned mining enterprises, MIND ID not only manages national mineral resources but also coordinates the development of the industrial ecosystem itself.
Under its integrated downstreaming agenda, MIND ID ensures that the management of mineral and coal resources is not merely oriented towards exploitation, but also creates sustainable added value for the nation.
MIND ID President Director Maroef Sjamsoeddin stated that, as a national mining state-owned enterprise, the company carries out the state’s mandate to manage mineral resources optimally and sustainably.
“Our vision as an integrated mining company is consistently translated through the downstreaming agenda that is already under way and continues to be strengthened across the entire MIND ID Group,” said Maroef during a hearing with Commission XII of the House of Representatives (DPR RI) recently.
One of MIND ID’s main current focuses is the development of the electric vehicle (EV) battery industrial ecosystem. The project covers the complete supply chain, from the mining of nickel ore as a strategic mineral, the construction of processing and refining facilities, the development of battery materials in East Halmahera, through to the construction of a battery plant in Karawang.
Beyond nickel, MIND ID is also continuing to push downstreaming across various other mineral commodities to ensure added value is created domestically whilst strengthening Indonesia’s position in the global supply chain.
Maroef emphasised that all downstreaming projects are carried out with attention to regulatory compliance, environmental impact control, and sustainability principles.
“MIND ID is committed to ensuring that the national downstreaming agenda not only runs, but delivers real and measurable benefits for the national economy, whilst supporting energy security, the renewable energy transition, and the development of Indonesia’s future industries,” he added.
Building an ecosystem from upstream to downstream
To accelerate the development of the national battery industry, the government has established PT Industri Baterai Indonesia (IBC) as a collaboration between the MIND ID Group, Pertamina, and PLN under the coordination of Danantara Indonesia. IBC acts as the orchestrator of the national battery ecosystem, integrating the value chain from upstream to downstream.
In the upstream sector, the MIND ID Group ensures the supply of strategic minerals through ANTAM as a nickel producer, supported by Freeport Indonesia, INALUM, Bukit Asam, Timah, and Vale Indonesia. In the processing sector, IBC is developing a Cathode Active Material (CAM) plant in Tanjung Buli, Halmahera, as well as a battery cell plant in Karawang, which is targeted to begin operating in July 2026.
The plant is designed to have a production capacity of 6.9 GWh in its first phase, expandable to 15 GWh in the second phase. The project is projected to absorb around 3,200 workers, accompanied by a technology transfer programme through six months of training in China for 600 skilled workers.
“The first capacity we will install is 6.9 gigawatt-hours and, God willing, it is still on schedule. So in July 2026, by the end of July 2026, it will be operational,” said Aditya.
Indonesia’s great opportunity through NMC
Quoting the MINDJOURNEY VOL3 factsheet, in the development of electric vehicle battery technology, two types of cathode dominate the global market: Lithium Iron Phosphate (LFP) and Nickel Manganese Cobalt (NMC). The key difference between them lies in their material composition.
NMC uses nickel, manganese, and cobalt, resulting in higher energy density. LFP, meanwhile, uses only lithium, iron, and phosphate, without any nickel or cobalt content.
For Indonesia, this difference represents a strategic advantage. As the country with the world’s largest nickel reserves, Indonesia holds a stronger position in the NMC battery supply chain.
Conversely, the main raw materials for LFP, such as lithium and phosphate, still have to be imported, providing smaller added value for the national industry.
In terms of cost, the cathode accounts for around 40 per cent of total battery production costs, making it the most decisive component. This makes NMC batteries more expensive, at around US$62/kWh compared with LFP at around US$40/kWh.
However, that price is offset by higher energy density, meaning NMC offers better range and performance, particularly for high-performance electric vehicles.
Thus, although more expensive, NMC offers greater strategic value for Indonesia as it aligns with the country’s nickel resource advantage.
Regional collaboration
Minister of Energy and Mineral Resources Bahlil Lahadalia stated that Indonesia is opening up opportunities for nickel commodity cooperation with the Philippines as part of strengthening energy collaboration in the Southeast Asian region.
The statement was made ahead of the ASEAN Summit in the Philippines, led by President Prabowo Subianto.
According to Bahlil, ASEAN countries are building collective energy strength in Southeast Asia. In that context, nickel is one of the strategic commodities because it can be converted into raw material for electric vehicle batteries.
“Nickel is one of the energy commodities that can be converted into batteries. As it happens, in Southeast Asia, not all countries have battery ecosystem plants spanning upstream to downstream. Indonesia is one of those developing it. So, regarding nickel, Indonesia is simply keeping itself open,” said Bahlil at the Ministry of Energy and Mineral Resources office on Wednesday (6 May 2026).
He explained that such cooperation does not mean Indonesia will invest in the Philippines. According to him, the opportunity being opened relates more to the supply of raw materials should Indonesia experience a supply shortage.
“But that does not mean the cooperation involves us investing there. Rather, they could perhaps supply us if we fall short. If we lack raw materials, they can be supplied from anywhere. So there is no issue of more technically specific cooperation — there is none,” he said.
The Chairman of the Indonesian Mining Experts Association (Perhapi), Sudirman Widhy, believes Indonesia is a fortunate nation, blessed with abundant natural resources in terms of both potential and reserves.
He considers that the management of mining resources must first be prioritised to meet domestic needs.
Nickel, for example, is the main raw material for electric vehicle batteries and stainless steel, whilst bauxite is used for aluminium production and copper for a variety of industrial needs.
“All of these industrial products are essential for the development process to make Indonesia an advanced nation capable of delivering prosperity to its people. Therefore, the utilisation of these mineral resources must be prioritised for further processing domestically,” Widhy told CNBC Indonesia, quoted on Wednesday (8 July 2026).
This is precisely why the downstreaming and industrialisation programmes are so necessary to process these mineral resources into industrial products vital for national development. Moreover, these industrial products can also be sold to generate optimal revenue for the state.
Separately, the Chairman of the Indonesian Mining Institute (IMI), Irwandy Arif, believes that the 2026–2029 period will be a phase of strategic transformation for Indonesia’s mining industry.
At the very least, the sector will no longer function solely as a commodity supplier, but also as a driver of industrialisation, energy security, and the transition towards a sustainable economy.
“Indonesia’s mining industry in the 2026–2029 period will be in a phase of strategic transformation, in which the sector will not only act as a commodity supplier, but also as a driver of industrialisation, energy security, and the transition towards a sustainable economy,” he said.
He outlined that the future direction of the mining industry will focus on maintaining production stability, promoting downstreaming, and strengthening its contribution to national development. In addition, the application of sustainability principles (ESG) and the adoption of digital technology are important aspects for improving efficiency and competitiveness.