Prabowo: State-Owned Enterprises Must Be Profitable Before Funding Research

President Prabowo Subianto believes that a proposal for state-owned enterprises (BUMN) to allocate a portion of their profits to fund research and innovation cannot be separated from a major overhaul of the state-owned companies. According to him, BUMN must first be made healthy, efficient, and genuinely profitable before being burdened with an additional role in supporting the national research ecosystem.

This was conveyed by Prabowo at the closing of the 2026 National Science, Technology, and Industry Convention Sarasehan on Sunday (28/6).

"Earlier there was also a proposal regarding the research funding sector. It was proposed that each BUMN allocate a portion of their profits for research and innovation. This is a good proposal. The problem is, do these BUMN have profits? Now they are starting to. Thank you. In the past year, they have started to make a profit," Prabowo said.

Prabowo stated that the idea of directing a portion of BUMN profits towards research is worth following up. However, he stressed that the government must first ensure that state-owned companies are no longer a burden on state finances.

According to him, the government is currently rationalising the number of BUMN, which is considered too bloated and inefficient. From more than 1,000 BUMN, Prabowo said the government has already closed over 200 companies. The target is to further reduce this number to around 300, and eventually to about 250.

"From more than a thousand BUMN, we have now closed over 200. Later we will make it just 300. Ultimately, it will be 250. Imagine. We are closing more than 750," he stated.

Prabowo assessed that the large number of BUMN did not automatically make the state stronger. On the contrary, an overly large structure only drained the budget for operational costs, including directors, commissioners, and corporate overhead, even though not all were capable of generating profit.

He said the government wants to stop unproductive management practices within BUMN, especially when public funds are spent on corporate administration that provides no real benefit.

"Unprofitable companies only pay overhead. We want to be rational and efficient. And we are proving this. We are doing it. And I ask that this be completed within this year. So within two years, we will make BUMN more efficient, more transparent, and more dedicated to working for the people," Prabowo said.

With this streamlining, Prabowo hopes that BUMN will have better fiscal space and financial performance. Once they are healthy and sustainably profitable, BUMN can then contribute to supporting national research and innovation funding.

In addition to research funding, Prabowo stated that the government will follow up on various other proposals from the convention. One of these is increasing the allocation of funds for doctoral students, particularly lecturers at both public and private universities.

Prabowo described the various inputs delivered during the forum as good and reasonable proposals to strengthen the national education, research, and innovation ecosystem.