Revocation of State Capital Injections (PMN) Realizes SOE Work Transformation Towards Modern Business Entities
By: Wahyu Gunawan
President Prabowo Subianto has taken a firm step by revoking the State Capital Injection (PMN) program for State-Owned Enterprises (SOEs). This move marks the beginning of a new chapter in transforming these state-owned corporations into modern business entities that are far more independent and efficient.
For years, PMN had been a cornerstone of fiscal support for various SOEs, but at the same time, it also fostered a structural dependency that hindered competitiveness and professionalism.
Therefore, through the issuance of Government Regulation (PP) Number 20 of 2025, President Prabowo officially canceled PP Number 34 of 2022, which previously regulated the addition of PMN for PT Waskita Karya.
This decision not only stops the practice of direct state capital injection into SOEs but also symbolizes a shift in national funding strategy towards a model that is far more oriented towards efficiency and independence.
Responding to the PMN revocation, Member of Commission VI of the House of Representatives, Sartono Hutomo, highly praised President Prabowo Subianto’s move. He believes that the State Capital Injection program has indeed made some SOEs accustomed to living in a comfort zone, leading them to be overly dependent on the State Budget (APBN) and have minimal incentive to improve.
According to Sartono, this policy further burdened the state budget, whereas these funds could have been allocated by the government to improve vital sectors such as health and education.
He emphasized that SOEs need to demonstrate managerial capacity, be able to generate significant profits and dividends, and become a driving force for national economic growth, rather than merely being fiscal drains.
The PMN revocation also received support from the Daya Anagata Nusantara Investment Management Agency (BPI Danantara), which now takes over the financing function for SOEs through the management of funds from the dividends of state-owned companies.
Chief Operating Officer of BPI Danantara, Dony Oskaria, affirmed that going forward, capital injections for SOEs will no longer come from the APBN but from the results of internal fund management collected and channeled through Danantara.
With this new mechanism, the funding process will undergo much stricter and more transparent selection standards than before, ensuring that every company is worthy of receiving investment based on a mature business plan and national strategic sectors.
Dony also emphasized that Danantara will apply strict parameters in evaluating the feasibility of companies applying for capital injections, including the readiness of their business plans and industry prospects.
He assured that all these stages would be professional and free from collusive practices, as every submission must still receive approval from the House of Representatives.
This is expected to further strengthen the integrity of the funding system and simultaneously deter the practice of moral hazard that has long overshadowed the pattern of fiscal injections into SOEs.
In line with the transformation vision proclaimed by President Prabowo, CEO of Danantara, Rosan Roeslani, explained that the PMN revocation is part of the government’s grand strategy to further increase the role of investment in driving national economic growth.
According to Rosan, investment contributes nearly one-third of Indonesia’s total Gross Domestic Product (GDP), thus requiring much more modern and flexible governance to accelerate national economic potential.
He mentioned that Danantara manages funds of around IDR 150 trillion from SOE dividends, which will be used to finance sustainable national strategic projects, create quality jobs, and enhance the attractiveness of foreign investment through a multiplier effect.
Prabowo’s move is considered by some parties as a correction to past policies. Data shows that during the previous decade of government, PMN channeled to SOEs surged sharply, from IDR 46.98 trillion during President SBY’s era to more than IDR 355 trillion during President Jokowi’s era.
Unfortunately, this surge was not always accompanied by an improvement in corporate performance; instead, it left problems of debt, weak governance, and alleged misuse of funds, as happened with several state-owned construction companies.
Researcher from Next Policy, Dwi Raihan, also considers the government’s decision to revoke PMN as a progressive step that deserves appreciation. According to him, this policy encourages SOEs to be more independent and innovative while curbing the risk of moral hazard in state financial management.
Raihan also highlighted the performance disparity among SOEs, where most still face structural obstacles despite receiving large capital injections. He emphasized the importance of professional management and freeing SOEs from political interests to optimize their contribution to state revenue.
In a broader context, the PMN revocation also serves as a foundation for Indonesia to abandon inefficient corporate subsidy patterns. SOEs should no longer function as a fiscal burden but must stand as competitive and strategic entities capable of creating long-term value. Through an investment-based funding mechanism with high accountability, the transformation of SOEs into modern business entities finally finds a stronger footing. (*)
Economic and Development Researcher – Prosperous Indonesia Economic Forum
