Indonesia's Digital Economy Amid Global Turbulence
Jakarta (ANTARA) - Indonesia is undergoing a digital acceleration felt in everyday life: internet is becoming more accessible, public services are more connected, and cashless payments are becoming the new normal. At the same time, the world faces geopolitical tensions that could directly impact the economy and stability, particularly as the US-Iran relationship heats up. In such a situation, Indonesia’s ability to harness digital progress will determine how resilient we are in facing global shocks.
Indonesia’s digital foundations have strengthened significantly in recent years. An internet service providers association report shows the number of internet users reaching around 229 million by the end of 2025, with a penetration of 80.66 per cent of the population. The figure has risen from 2024 and 2023, indicating that the internet has become a primary necessity for Indonesian society, not merely a supplement. This trend is accompanied by a narrowing digital divide between urban and rural areas as networks and digital services expand across regions.
Connectivity is not just about mobile networks and fibre. The government has also operated the SATRIA-1 satellite since January 2024 to strengthen public services in hard-to-reach areas. This satellite, with a capacity of 150 Gbps, is designed to connect around 37 thousand service points (schools, community health posts, government offices, and security posts) through a public-private partnership approach to ensure sustainable funding. This approach also shifts part of older internet access programmes to be more efficient, as the satellite capacity is now owned by the state itself and not entirely dependent on leasing from other operators.
On the transactions side, consumer habits are also changing rapidly. QRIS and BI‑FAST are making digital payments easier, cheaper, and faster. Bank Indonesia noted that in 2024 the volume of digital payments reached 34.5 billion transactions (up 36 per cent from the previous year). The most striking growth occurred in QRIS, which jumped by around 175 per cent in a year, while BI‑FAST retail transactions surpassed 3.4 billion. This fact is a strong indication that businesses—from small to large—are increasingly comfortable transacting cashless.
These advances bring new responsibilities: personal data must be protected, and systems must be secure. The Personal Data Protection Act (UU PDP) officially came into force on 17 October 2024, with strict penalties for violations and plans to establish a dedicated supervisory body. The challenge is that public understanding of privacy rights remains limited, while many organisations need to overhaul their cyber security to prevent data leaks from recurring.
Abroad, modern warfare methods have also changed. Drones are now widely used because they are cheap, agile, and hard to detect. Field reports show the use of commercial satellite connections to control drones remotely, making signals harder to jam. This is an example of how technology that began in civilian use can enter the military realm and reshape the defence map. In many attacks, the targets hit are critical infrastructure (refineries, fuel depots, and supply routes) with relatively low attack costs but high impact.
Another dimension no less dangerous is cyber attacks. Since the Stuxnet incident was uncovered in 2010 (when computer code damaged critical industrial equipment), the world realised that cyber attacks can cause real physical damage, not just data theft. Since then, many countries have developed cyber capabilities to hack, spy on, or disable opponents’ systems. Various studies place Iran as an increasingly active player in cyberspace, though still behind other state cyber powers such as the United States and Israel.
In the context of escalating US–Iran tensions, reports from 2025 through early 2026 describe heightened military exercises, air operations, and drone incidents around US assets. On 28 February 2026, multiple reports described a response to an American–Israeli strike on Iran with missile fire and Iranian air strikes on several locations in the region, triggering airspace closures and emergency alerts in many places. This situation shows how rapidly escalation can occur when both sides deploy modern weaponry, including missiles and long-range drones.
Another potential risk is disruption in the Strait of Hormuz, the narrow waterway through which around a fifth of world oil supply passes. Analyses show that Iran has various means to hinder shipping, though a total closure of the strait for a long period is deemed difficult. Even a temporary halt would be enough to unsettle world energy prices and put pressure on the economies of many countries, including Indonesia.
What does all this mean for Indonesia? First, the increasing digitisation of public and financial services makes cyber security not a choice but a necessity. We need to ensure SATRIA-1-based services are safe from attacks, government data centres are protected, and the national payment systems are robust against hacking attempts. The enforcement of the PDP Law should be the backbone of public trust: the supervisory body must be operational soon, organisations must appoint data protection officers, and incidents must be reported and dealt with swiftly.
Second, tensions in the Middle East could affect energy prices and logistics costs. Indonesia needs contingency scenarios: diversify supplies, stock buffers, and coordinate with oil and gas players and shipping to dampen domestic impacts. Readiness of infrastructure to accept altered routes and higher insurance costs is also important, as this sector directly interacts with transport costs and the price of goods.
Third, changing warfare patterns demand protection of vital assets from drone threats. A layered approach combining detection, signal disruption, physical interception, and simple security procedures at energy facilities, ports, and other critical infrastructure.