Government Targets Health Sector Investment as New Economic Driver
The Ministry of Investment and Downstreaming/Investment Coordinating Board (BKPM) is now prioritising the health sector as a new driver for investment in Indonesia. This step is taken to capture the vast potential of the domestic market.
Director of Promotion for East Asia, South Asia, Middle East, and Africa at the Ministry of Investment and Downstreaming/BKPM, Cahyo Purnomo, revealed that approximately 2 million Indonesians choose to seek treatment abroad every year.
This phenomenon, as quoted from Ekonomi, is viewed as a basic need as well as a promising investment opportunity for the country. The government is striving to undertake a major transformation to strengthen national health independence.
“The Indonesian government under the leadership of President Prabowo Subianto has also provided guidance on how the health sector plays an important role, including through the transformation process being carried out,” said Cahyo.
Up to the first quarter of 2026, the Indonesian economy recorded growth of 5.6 percent. Investment is one of the main pillars supporting the national economic performance.
Cahyo mentioned that the investment achievement in the health sector in 2025 has reached US$574 million. This figure marks the highest record in the history of health investment in Indonesia.
Japan is recorded as the third largest investing country in the health sector in the country. Currently, the government is overseeing a major investment plan from a Japanese company in the pharmaceutical sector with a value of up to US$1.4 billion.
Independence in Drug Raw Materials
The investment funds will then be focused on building facilities for drug raw material production. This strategic step aims to reduce dependence on imported supplies from China and India.
“This is a very important sector where Indonesia’s needs have so far relied on imports,” said Cahyo.
To attract more interest from investors in the pharmaceutical and medical device fields, the government is preparing various incentives. The facilities offered include both fiscal and non-fiscal incentives.
The available fiscal support includes tax holiday policies, tax allowances, and various tax reliefs, especially for operations in Special Economic Zones (SEZs). Meanwhile, non-fiscal incentives include simplification of business licensing and administrative ease for investors.