Indonesia Lost Up to Rp2,000 Trillion in Investment Due to Complex Licensing
Jakarta (ANTARA) - Deputy Minister of Investment and Downstreaming/Deputy Head of the Investment Coordinating Board (BKPM) Todotua Pasaribu stated that Indonesia lost the opportunity to secure up to Rp2,000 trillion in investment due to complex licensing processes.
"We found that in 2024, realised investment was around Rp1,500 trillion, potentially reaching Rp2,000 trillion in unrealised investment," said Todotua in Jakarta on Thursday.
He explained that the lost investment opportunities were partly caused by complicated investment licensing and an unfavourable business climate in Indonesia. Additionally, investment-related policies were considered overlapping, creating confusion.
"Because of issues like these — licensing, an unconducive investment climate, various overlapping policies and others — this certainly must serve as a note and reflection for all of us," he said.
In response, the government issued Government Regulation (PP) Number 28 of 2025 on Risk-Based Business Licensing. The regulation integrates BKPM Regulations 3/4/5 of 2021, which cover the Online Single Submission (OSS) System, Licensing Services, and Supervision.
He also noted that BKPM had proposed to the Coordinating Ministry for Economic Affairs to grant licences to investors wishing to invest in designated zones, industrial estates, Special Economic Zones (SEZs), and free trade zones.
According to him, licensing requirements must still be complied with, but this can be done through post-audit processes.
"If the investor is ready, we at the Ministry of Investment will issue the licence, and the rest will be subject to post-audit. Because once someone has invested, they're not going to run away. We shouldn't make them wait until all permits are completed," he added.
"We found that in 2024, realised investment was around Rp1,500 trillion, potentially reaching Rp2,000 trillion in unrealised investment," said Todotua in Jakarta on Thursday.
He explained that the lost investment opportunities were partly caused by complicated investment licensing and an unfavourable business climate in Indonesia. Additionally, investment-related policies were considered overlapping, creating confusion.
"Because of issues like these — licensing, an unconducive investment climate, various overlapping policies and others — this certainly must serve as a note and reflection for all of us," he said.
In response, the government issued Government Regulation (PP) Number 28 of 2025 on Risk-Based Business Licensing. The regulation integrates BKPM Regulations 3/4/5 of 2021, which cover the Online Single Submission (OSS) System, Licensing Services, and Supervision.
He also noted that BKPM had proposed to the Coordinating Ministry for Economic Affairs to grant licences to investors wishing to invest in designated zones, industrial estates, Special Economic Zones (SEZs), and free trade zones.
According to him, licensing requirements must still be complied with, but this can be done through post-audit processes.
"If the investor is ready, we at the Ministry of Investment will issue the licence, and the rest will be subject to post-audit. Because once someone has invested, they're not going to run away. We shouldn't make them wait until all permits are completed," he added.