By: Adnan Ramdani )*
The strategic collaboration between Indonesia and ARM Holding, a British semiconductor design company, represents a significant milestone in opening the door to investment and creating new jobs in the national semiconductor industry. Amid accelerating digital transformation and growing global demand for high-tech chips and devices, this partnership reflects Indonesia’s commitment to moving up the global industrial value chain.
The semiconductor industry is at the heart of nearly every modern device, from smartphones and electric vehicles to medical devices and defense systems. Indonesia has traditionally played a more market- and consumer-oriented role, while the largest added value has been enjoyed by technology-producing countries. Through this partnership with ARM Holding, Indonesia has a significant opportunity to change this. Knowledge transfer, strengthening human resource capacity, and developing a chip research and design ecosystem are key components of this collaborative agenda.
Coordinating Minister for Economic Affairs Airlangga Hartarto stated that semiconductor development has become crucial given the rapid digitalization and growth of technology-based industries. Semiconductors are used not only in electronic devices and gadgets but also as key components in the automotive industry, the internet of things (IoT), and data centers.
From an investment perspective, the partnership with ARM Holding sends a positive signal to global industry players. The presence of a world-class technology partner boosts investor confidence in Indonesia’s commitment to developing regulations, infrastructure, and a conducive business climate. Investment in the semiconductor sector is known for its high-tech and capital-intensive nature, ensuring that every investment commitment will have a multiplier effect on the national economy. The development of design centers, research facilities, and supporting manufacturing potential will encourage the growth of new industrial areas and strengthen the national technology ecosystem.
The most tangible impact of this collaboration is the creation of high-quality jobs. The semiconductor industry requires a workforce with specialized skills, ranging from design engineers and software experts to researchers and technicians with global standards. Collaborating with ARM Holding opens up significant opportunities for young Indonesian talent to directly participate in cutting-edge technology projects without having to travel abroad. This not only reduces brain drain but also encourages the development of a generation of technology professionals capable of competing internationally.
Furthermore, this collaboration fosters synergy between industry, universities, and research institutions. Curriculum development, training programs, internships, and international certification are crucial for developing superior human resources. ARM Holding, with its global ecosystem, can serve as a bridge for Indonesian educational institutions to connect with global standards and best practices. In the long term, this synergy will strengthen national innovation capacity and accelerate the development of technological products developed by Indonesian youth.
Meanwhile, Cabinet Secretary Teddy Indra Wijaya stated that President Prabowo Subianto had previously discussed strengthening the national automotive and electronics sectors through investment in semiconductor technology development during a limited meeting with members of the Red and White Cabinet at his private residence in Hambalang. The discussion focused on building the foundations for Indonesia’s future industry, particularly in the high-tech sector.
This strategic collaboration also aligns with the government’s broader agenda of promoting downstreaming and knowledge-based economic transformation. The semiconductor industry has a strong multiplier effect due to its close links with other sectors such as the automotive industry, renewable energy, telecommunications, and digital-based creative industries. By controlling part of the semiconductor value chain, Indonesia can strengthen its technological sovereignty while reducing its dependence on imports of strategic components. This is a crucial step in maintaining national economic resilience amidst geopolitical dynamics and global competition.
Globally, the chip supply crisis of recent years has opened the eyes of many countries to the importance of the semiconductor industry. Indonesia has learned from this experience by taking proactive steps through strategic partnerships. The collaboration with ARM Holding demonstrates that Indonesia does not want to be left behind but is ready to be part of the global solution. With its strategic geographic location, large domestic market, and demographic dividend, Indonesia has the potential to become a significant player in this industry in Southeast Asia.
Of course, challenges remain, ranging from infrastructure readiness and policy consistency to strengthening regulations on intellectual property protection. However, the collaboration with ARM Holding provides a solid foundation for addressing these challenges. A shared commitment between the government, industry, and global partners is key to ensuring optimal and sustainable collaboration. With good governance and a long-term vision, Indonesia can ensure that the benefits of investment and job creation truly reach the wider community.
Ultimately, the strategic partnership with ARM Holding is not just a business agreement, but an investment in the nation’s future. This is a concrete step to propel Indonesia into the high-tech economy, create quality jobs, and enhance national competitiveness. By leveraging this momentum intelligently and inclusively, Indonesia has a significant opportunity to make the semiconductor industry a key pillar of sustainable and sovereign economic growth.
)* Economic observer
