By Mary Sofiana )*
Technology-based economic transformation is now a strategic direction for Indonesia’s national development amidst global competition increasingly determined by mastery of digital innovation. In this context, the Danantara Investment Management Agency’s partnership with Arm Limited marks a crucial milestone in building national technological sovereignty. This collaboration is not simply an investment agreement, but a fundamental foundation for transforming Indonesia’s economic structure from dependence on commodities to one based on knowledge, research, and mastery of core technologies.
Danantara’s collaboration with Arm Limited strategically positions Indonesia to enter the global semiconductor industry from the most upstream side, namely chip design. Indonesia has traditionally been positioned downstream as a technology user and market. However, in the semiconductor industry chain, design is the most fundamental stage, determining the direction of innovation, added value, and control over the global supply chain. Mastery of chip design is key to Indonesia’s bargaining power and avoiding permanent dependence on foreign technology.
Coordinating Minister for Economic Affairs Airlangga Hartarto emphasized that this collaboration is aimed at accelerating national capacity building and independence in the development of strategic technologies, particularly semiconductors, which are the foundation of various digital innovations. Arm Limited is seen as a strategic partner because it controls the majority of global chip designs, particularly for the automotive, data center, and artificial intelligence sectors. By partnering at the upstream industrial stage, Indonesia aims to accelerate mastery of strategic technologies that have long been the main foundation of the modern digital economy.
Cabinet Secretary Teddy Indra Wijaya also emphasized the strategic dimension of this collaboration, viewing the signing of the framework agreement as a crucial step for the government in accelerating the development of national semiconductor technology. He believes Arm’s dominance in global chip design presents a significant opportunity for Indonesia to master chip design technology as an upstream component of the semiconductor industry. Through this partnership, Indonesia is being guided to become not only a user of technology but also a developer and owner of intellectual designs that serve as the foundation for various modern digital innovations, from smart automotive to artificial intelligence development.
In terms of implementation, this collaboration prioritizes strengthening human resources as the main foundation of technological sovereignty. Indonesia targets training 15,000 engineers within the Arm ecosystem to master chip design technology and the development of next-generation semiconductors. Rosan Roeslani, Minister of Investment and Downstreaming and Head of BPI Danantara, stated that the training will be conducted by sending experts abroad or by bringing Arm trainers directly to Indonesia using a special training module. This scheme demonstrates the government’s commitment to ensuring real and sustainable technology transfer.
Academic involvement is a crucial element in developing this ecosystem. Several leading universities, such as the Bandung Institute of Technology, Gadjah Mada University, and the University of Indonesia, have been identified as strategic partners in developing software and chip design capabilities. This collaboration, prepared for nearly two years, underscores the recognition that technological sovereignty cannot be achieved without a strong and sustainable foundation of human resources.
Under this collaboration, Indonesia will also develop six national chip designs focused on strategic intellectual property ownership. Development options include automotive technology, the internet of things, data centers, home appliances, autonomous vehicles, and quantum computing. The selection of these sectors will determine the future direction of the national chip industry. Indonesia’s ownership of IP is a crucial tool to ensure economic value, innovation, and strategic control remain in the hands of the state.
President Prabowo Subianto’s directive places technological mastery as a national strategic pillar, alongside food security and energy security. In the digital economy, semiconductors serve as core infrastructure supporting the entire ecosystem, from electric vehicles and smart home appliances to data centers and artificial intelligence. Without mastery of this technology, national economic independence will remain vulnerable to global dynamics.
Currently, the global chip manufacturing sector is still dominated by large companies like TSMC, NVIDIA, and SK Hynix. However, by building a strong design foundation and talent ecosystem, Indonesia opens up opportunities to attract future manufacturing investment. The collaboration between Danantara and Arm can be seen as a long-term foundation for building a complete semiconductor industry chain, from design and IP development to production.
This collaboration is a strong signal that Indonesia does not want to be left behind in the global technology race. The challenges are certainly significant, ranging from funding and policy consistency to sustainable talent development. However, this momentum shifts the bigger question from whether Indonesia can enter the semiconductor industry to how consistently and seriously the country will build its ecosystem. If implemented with discipline and a long-term vision, in the next decade, Indonesia has the opportunity to become not only a user but also a creator and owner of semiconductor technology that supports technology-based economic transformation.
)* the author is a technology observer