Indonesia is positioning artificial intelligence as a central pillar of its long-term economic strategy, with the government estimating that widespread adoption of the technology could contribute up to 3.67 percent to the country’s gross domestic product.
Minister of Communication and Digital Affairs Meutya Hafid said the projection underscores how rapidly the foundations of economic competitiveness are shifting, moving away from traditional resource-based advantages toward technological capability and data-driven innovation.
“Competitiveness today is no longer determined by resources, but by the ability to adapt to technology, especially artificial intelligence,” Hafid said during the “The Power of AI” forum, according to an official ministry statement released on Sunday.
She added that Indonesia is increasingly well-positioned to benefit from the global expansion of AI applications, provided that adoption is accelerated across both public and private sectors in a structured and inclusive manner.
Hafid emphasized that the economic value of data has become a defining feature of modern digital economies, arguing that countries capable of converting information into practical solutions will hold a significant advantage.
“Value has now shifted. It is no longer about resources, but about our ability to transform data into solutions,” she said.
Her remarks reflect a broader policy direction within the Indonesian government, which has been seeking to strengthen the digital economy as a major growth engine amid global economic uncertainty and intensifying technological competition.
According to World Bank data cited by the ministry, Indonesia ranks 41st out of 198 countries in public digital transformation capacity and is placed in category A, indicating relatively strong institutional readiness in developing digital public services.
Hafid said this ranking shows that Indonesia is steadily consolidating its position as one of Southeast Asia’s leading digital economies, although she stressed that further acceleration is required to fully realize its potential.
“Indonesia continues to strengthen its position as a major digital economic power in Southeast Asia,” she said.
While AI adoption is already visible in several parts of Indonesia’s economy, the government believes its implementation remains uneven across sectors.
Hafid noted that financial services and retail industries are currently leading in the integration of artificial intelligence tools, particularly in areas such as customer analytics, fraud detection, and automated service systems.
However, she stressed that broader national impact will depend on faster uptake in sectors that directly affect productivity and public welfare.
“Health, agriculture, and manufacturing must be accelerated because that is where we can create the greatest impact,” she said.
These sectors are seen as critical to Indonesia’s development agenda, particularly in improving healthcare access, increasing agricultural efficiency, and strengthening industrial competitiveness.
Government officials have previously highlighted that AI could play a role in addressing structural challenges such as uneven healthcare distribution across the archipelago, agricultural productivity gaps, and supply chain inefficiencies in manufacturing.
Alongside efforts to promote adoption, the government is also finalizing a regulatory framework designed to manage the risks associated with artificial intelligence.
Hafid underlined that governance will be essential to ensure that technological development remains safe, ethical, and aligned with national interests.
“AI regulation is no longer an option, it is an urgent and inevitable necessity,” she said.
The ministry confirmed that a presidential regulation outlining Indonesia’s national AI roadmap and ethical framework has been completed and is currently awaiting official ratification.
Once approved, the roadmap is expected to provide strategic direction for AI development across sectors while also setting standards for data protection, algorithmic accountability, and responsible deployment.
“This roadmap provides clear direction while ensuring public protection from various AI risks,” Hafid said.
The framework is also expected to align Indonesia with global discussions on AI governance, where countries are increasingly seeking to balance innovation with safeguards against misuse, bias, and security threats.
Expanding AI benefits to SMEs
Beyond large-scale industries and government institutions, the administration is also focusing on ensuring that small businesses and underserved communities are not left behind in the digital transition.
Hafid said the government will continue pushing for inclusive AI adoption, including among micro, small, and medium enterprises (MSMEs), which form the backbone of Indonesia’s economy.
The goal, she explained, is to ensure that digital transformation does not remain concentrated in major urban centers or large corporations but instead generates widespread economic benefits across regions and income groups.
Policy initiatives are expected to include training programs, access to digital tools, and partnerships with technology providers to help smaller businesses integrate AI into daily operations such as marketing, logistics, and customer engagement.
Indonesia’s push toward artificial intelligence reflects a broader strategy to transition toward a knowledge-based economy, where productivity is increasingly driven by innovation, automation, and digital infrastructure.
Economists have noted that successful AI integration could significantly enhance efficiency across industries, potentially boosting competitiveness in global markets and attracting higher levels of foreign investment.
However, analysts also caution that achieving the projected GDP impact will depend on several factors, including infrastructure readiness, digital literacy, investment in research and development, and regulatory clarity.
The government maintains that its current policy direction is designed to address these challenges simultaneously, combining infrastructure expansion with human capital development and legal frameworks.
As Indonesia continues to expand its digital economy footprint, artificial intelligence is expected to remain at the center of its economic transformation strategy, shaping both public policy and private sector innovation in the years ahead.
