Indonesia Proposes Sovereign AI Fund to Become a Powerhouse in Artificial Intelligence
Indonesia has proposed a sovereign AI fund in line with its ambition of becoming Southeast Asia’s regional hub for artificial intelligence. The initiative, outlined in a 179-page white paper, positions this fund as central to the country’s first national AI roadmap.
The fund would be managed by Danantara Indonesia, the nation’s sovereign wealth fund, which already controls over US$900 billion in state assets. The roadmap estimates implementation during 2027–2029 under a public-private partnership, with eligibility for fiscal incentives for AI-focused domestic investors.
Strategic Goals and Economic Prospects
Key objectives of the AI Fund include strengthening infrastructure and research capacity, addressing talent shortages, and improving connectivity in underserved regions. The paper maps out a vision through 2030, which also anticipates challenges such as misinformation, data security risks, and uneven innovation across urban-rural divides.
A report from Boston Consulting Group projects that AI adoption could contribute 2.3% to 3.1% to GDP growth across ASEAN countries by 2027, with Indonesia potentially reaping the largest absolute gains in regional terms.
How Will the Proposal Be Implemented
The proposal suggests a blended financing model: combining public budget support, private investment, and multilateral cooperation. Also included are fiscal incentives for domestic investors that deploy capital into AI initiatives.
Public feedback is still being sought before the roadmap is finalised. Meanwhile, contributions from industry players, including major technology firms such as Huawei and GoT,o have informed the drafting process.
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