Investment Ministry Revises Three Regulations to Accelerate Investment and Achieve 8 Percent Growth Target
The Ministry of Investment and Downstream Industries/Investment Coordinating Board (BKPM) is currently revising three implementing regulations of Government Regulation No. 5 of 2021 on Risk-Based Business Licensing. The revision is expected to accelerate investment realisation and achieve the national economic growth target of 8 per cent by 2029.
"This government has a target of economic growth towards eight per cent. This is a fairly ambitious figure, but also quite realistic if it can be achieved," said Deputy Minister of Investment and Downstream Industries/BKPM Todotua Pasaribu at a Public Consultation on the Draft Ministerial Regulation, Thursday, 3 July 2025.
The three regulations being revised are BKPM Regulation No. 3 of 2021, which governs the Electronically Integrated Risk-Based Business Licensing System; BKPM Regulation No. 4 of 2021, which specifically governs the Guidelines and Procedures for Risk-Based Business Licensing Services and Investment Facilities; and BKPM Regulation No. 5 of 2021, which governs the Guidelines and Procedures for Risk-Based Business Licensing Supervision.
Todotua compared that during the previous government's ten-year tenure, investment realisation reached approximately Rp 9,900 trillion. Meanwhile, the current administration has set a target to pursue eight per cent economic growth. Consequently, domestic investment over the next five years must reach Rp 13,000 trillion.
"If during the previous government's 10 years, investment realisation was approximately Rp 9,900 trillion, then in the next 5 years to reach eight per cent, we need investment realisation of Rp 13,000 trillion."
This year, the investment target has been raised to Rp 1,900 trillion, up from the 2024 realisation of Rp 1,700 trillion. Investment realisation in the first quarter of 2025 reached Rp 465 trillion, and preliminary reports for the second quarter also show reassuring results.
"The first quarter was approximately Rp 465 trillion in investment realisation. Then in the second quarter, I was informed by the Deputy from Monday that the figures are relatively safe. And if my deputies are to be believed, hopefully the second quarter will still be on track," he said.
Nevertheless, the ministry is anticipating challenges ahead, particularly in the third and fourth quarters, as investment realisation is heavily dependent on licensing services.
He recounted that Indonesia lost potential investment of up to Rp 2,000 trillion in 2024. This was caused by various longstanding issues ranging from licensing problems to an unconducive investment climate.
"We found that in 2024, unrealised investment was around 1,500, possibly reaching Rp 2,000 trillion. Unrealised investment — why? Because of problems like licensing, an unconducive investment climate, various overlapping policies, and so on," he said.
The Ministry of Investment and Downstream Industries, led by Minister Rosan Roeslani, is determined to reform licensing issues.
"This must certainly be a note and reflection for all of us. And we at the Ministry of Investment under Minister Rosan Roeslani have a very strong desire to reform this. And particularly, the President always speaks firmly — we are talking about reforming the bureaucracy."
With the revision of the three ministerial regulations, the process of business licensing is expected to become faster and simpler.
"Hopefully this will also be a breakthrough step in our actions to accelerate, simplify and especially provide certainty — certainty regarding business licensing," he said.
Currently, there are 1,700 types of licences involving approximately 17 ministries and agencies. However, the financial industry has yet to use the Online Single Submission (OSS) system. Therefore, the ministry and the Financial Services Authority (OJK) have agreed that the financial industry should also be integrated into the OSS system.
"This government has a target of economic growth towards eight per cent. This is a fairly ambitious figure, but also quite realistic if it can be achieved," said Deputy Minister of Investment and Downstream Industries/BKPM Todotua Pasaribu at a Public Consultation on the Draft Ministerial Regulation, Thursday, 3 July 2025.
The three regulations being revised are BKPM Regulation No. 3 of 2021, which governs the Electronically Integrated Risk-Based Business Licensing System; BKPM Regulation No. 4 of 2021, which specifically governs the Guidelines and Procedures for Risk-Based Business Licensing Services and Investment Facilities; and BKPM Regulation No. 5 of 2021, which governs the Guidelines and Procedures for Risk-Based Business Licensing Supervision.
Todotua compared that during the previous government's ten-year tenure, investment realisation reached approximately Rp 9,900 trillion. Meanwhile, the current administration has set a target to pursue eight per cent economic growth. Consequently, domestic investment over the next five years must reach Rp 13,000 trillion.
"If during the previous government's 10 years, investment realisation was approximately Rp 9,900 trillion, then in the next 5 years to reach eight per cent, we need investment realisation of Rp 13,000 trillion."
This year, the investment target has been raised to Rp 1,900 trillion, up from the 2024 realisation of Rp 1,700 trillion. Investment realisation in the first quarter of 2025 reached Rp 465 trillion, and preliminary reports for the second quarter also show reassuring results.
"The first quarter was approximately Rp 465 trillion in investment realisation. Then in the second quarter, I was informed by the Deputy from Monday that the figures are relatively safe. And if my deputies are to be believed, hopefully the second quarter will still be on track," he said.
Nevertheless, the ministry is anticipating challenges ahead, particularly in the third and fourth quarters, as investment realisation is heavily dependent on licensing services.
He recounted that Indonesia lost potential investment of up to Rp 2,000 trillion in 2024. This was caused by various longstanding issues ranging from licensing problems to an unconducive investment climate.
"We found that in 2024, unrealised investment was around 1,500, possibly reaching Rp 2,000 trillion. Unrealised investment — why? Because of problems like licensing, an unconducive investment climate, various overlapping policies, and so on," he said.
The Ministry of Investment and Downstream Industries, led by Minister Rosan Roeslani, is determined to reform licensing issues.
"This must certainly be a note and reflection for all of us. And we at the Ministry of Investment under Minister Rosan Roeslani have a very strong desire to reform this. And particularly, the President always speaks firmly — we are talking about reforming the bureaucracy."
With the revision of the three ministerial regulations, the process of business licensing is expected to become faster and simpler.
"Hopefully this will also be a breakthrough step in our actions to accelerate, simplify and especially provide certainty — certainty regarding business licensing," he said.
Currently, there are 1,700 types of licences involving approximately 17 ministries and agencies. However, the financial industry has yet to use the Online Single Submission (OSS) system. Therefore, the ministry and the Financial Services Authority (OJK) have agreed that the financial industry should also be integrated into the OSS system.