TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Analysis: Danantara in limbo: The endless tale of RI’s investment uncertainty
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
High-rise buildings are seen in Sudirman Central Business District in South Jakarta on March 14, 2021. (AFP/Adek Berry)
T
he official launch of the Daya Anagata Nusantara Investment Management Agency (BPI Danantara) still has a long way to go. First Deputy Finance Minister Thomas Djiwandono, who is also the nephew of President Prabowo Subianto, stated that the situation is more complex than anticipated, delaying the launch until a clear regulatory framework is established, a process that could take an indefinite amount of time.
Initially, Danantara’s inauguration was scheduled for Nov. 7, 2024, with President Prabowo officiating the event. However, the official launch was postponed due to the President’s overseas trip, which coincided with the planned date. Despite his return to Indonesia on Nov. 29, the agency remains in limbo as of January 2025, leaving many questioning its future.
Before the delay, key leadership appointments for Danantara had already been made. Muliaman D. Hadad was named head of the agency, while Pandu Patria Sjahrir was appointed Chief Operating Officer (COO). Following the postponement, Pandu provided an update in January, stating that the entire Danantara team is awaiting further instructions from President Prabowo.
The hurdles delaying Danantara’s establishment stem largely from the scale and expectations surrounding the agency. Often referred to as a “superholding” for Indonesia’s state-owned enterprises (SOEs), Danantara aims to consolidate assets from the country’s largest SOEs, estimated to be worth a staggering Rp 9.48 quadrillion (US$600 billion). As a comparison, Indonesia’s sovereign wealth fund, the Indonesia Investment Authority (INA), launched with Rp 75 trillion and managed assets totaling Rp 147.6 trillion as of 2023.
Several factors have contributed to the delay. In November 2024, sources revealed that the feasibility study for Danantara’s formation was behind schedule. Additionally, establishing the agency also requires an amendment to Law No. 19/2003 on State-Owned Enterprises, a process fraught with resistance from various stakeholders.
Another contentious issue involves state electricity company PT PLN, a key SOE that would fall under Danantara’s management. PLN’s monopoly over electricity is protected under Article 33 of the Indonesian Constitution, and any attempt to alter this monopoly could trigger challenges in the Constitutional Court.
Danantara’s scope includes managing the assets of the Indonesia Investment Authority (INA) to further enhance the government’s investment management capabilities. However, this raises concerns among foreign investors who have already committed funds to the INA. Prolonged delays in Danantara’s launch exacerbate these concerns, as investors become increasingly uneasy about the potential impact on their portfolios.
