Prabowo’s Strategy to Boost Investment: Downstreaming and Permit Reform Take Centre Stage
The government is accelerating the transformation of national investment by strengthening downstream industries and removing bureaucratic obstacles that have long concerned businesses. The strategy is showing positive signs, with downstreaming’s share of investment rising to 35% in the third quarter of 2026.
Investment and Downstreaming Minister and BKPM Head Rosan Roeslani said the government was not simply pursuing an increase in the value of investment entering Indonesia. It expects realised investment to create jobs, strengthen national industry and make a tangible contribution to economic growth.
“We will continue to encourage investment to increase and become higher quality. It should also have a positive impact on employment,” Rosan said in a statement in Jakarta on Tuesday, 20 October 2026.
Rosan explained that improving the quality of investment was a government priority, in line with President Prabowo Subianto’s direction. The policy follows a limited cabinet meeting involving several ministers from the Red and White Cabinet to strengthen the national investment climate.
According to Rosan, investment in downstream industries has shown an increasingly promising trend over the past two years. The sector’s contribution to national investment realisation has risen by nine percentage points since 2024.
“Looking at the trend, downstreaming accounted for only 26% in 2024. In the third quarter of this year, it had reached 35%,” Rosan said.
The increase is one indicator of the growing role of manufacturing in attracting investment to Indonesia. The government is seeking to sustain this momentum by developing strategic sectors with greater economic value added.
Nickel and electric vehicle batteries among key sectors
Rosan said the push for downstreaming was also intended to improve Indonesia’s competitiveness in global industrial supply chains. The government has identified nickel processing and the development of an electric vehicle battery ecosystem as strategic sectors for continued growth.
Development in both sectors is focused not only on increasing production capacity but also on building mastery of industrial technology. This approach is needed to ensure downstream investment delivers long-term benefits for national production capabilities and competitiveness.
“The government wants to strengthen Indonesia’s position as an important part of the world’s industrial supply networks. The success of downstreaming should not stop at processing natural resources, but should also help develop domestic industrial capabilities,” Rosan said.
Government issues 328 investment permits as bureaucracy is cut
Alongside strengthening downstream industries, the government is undertaking a major overhaul of business licensing services to provide investors with greater certainty. The reform is being implemented through an integrated licensing system involving 28 ministries and agencies.
One innovation is a deemed-approval mechanism to address delays by technical agencies in processing permits. Under the mechanism, the Ministry of Investment can grant approval in accordance with regulations if the competent agency fails to complete the process within the prescribed time limit.
Government records show that around 328 investment permits have been issued using this mechanism. The measure is intended to reduce administrative obstacles and speed up investment services involving multiple ministries and agencies.
Limited-stay permits for foreign workers now take five days
Investment services are also being accelerated by simplifying the process for obtaining limited-stay permits (KITAS) for foreign workers. The government says an administrative process that previously took up to several months can now be completed in five working days.
Rosan said certainty over procedures and service times was an important factor in investment decisions. The government is therefore continuing efforts to reduce uncertainty that could undermine business confidence.
“What investors want, of course, is certainty; they do not like surprises. That is what we are trying to provide by reducing uncertainty, including in licensing,” Rosan said.