The Business Year

Hon. Rudiantara

INDONESIA - Telecoms & IT

USD1.5 billion needed to connect all islands by 2019

Minister of Communication and Information Technology, Indonesia


Rudiantara is currently the Minister of Communications and Information Technology of Indonesia under the Ministry of Communication and Informatics. He was inaugurated in October 2014 as part of President Joko Widodo’s new cabinet.

"We cannot run from technology, which has great potential to solve wealth disparity and empower SMEs."

From a policy perspective, what are your strategies to drive a positive and inclusive disruption through digital innovation?

People, including the press, consider our ministry to be open. We cannot run from technology, which has great potential to solve wealth disparity and empower SMEs. However, it is not technology that is changing the world; people’s mindsets are changing the world. People always find new ways and new business processes by maximizing the use of technology. ICT is an enabler of economic growth and social transformation and now we focus on maximizing technology to support economic growth. We aim to have a digital economy of USD150 billion by 2020, which will comprise 11% of Indonesia’s GDP then. China, for example, has found its own way to deal with technology. It does not allow Google; instead, it introduced its own search engine platform. India similarly has its own ways. That is why Indonesia is currently in a transition period to position itself within the digital tsunami. Everyone in Indonesia is on Facebook and WhatsApp. We cannot stop those platforms or deny their access in Indonesia; however, we want also to develop our own platforms. The government needs to position itself to protect people from the negative impacts of this technology. We are working hard with foreign investors that want to conduct their business in Indonesia and we would like to be as competitive as possible in the international landscape, because Indonesia is a competitive country.

What role can technology play in formalizing the economy?

The key to technology is broadband. With that, we have an ecosystem that consists of excellent tools, devices, and applications; these all have to co-exist. We have the network. This country started to introduce 4G technology at the end of 2015. Currently, 297 regencies and cities regional cities out of 512 have 4G coverage, and we aim for all regions to be connected to broadband and 4G by 2019. From an ICT infrastructure perspective, we are number four in Asia currently after Singapore, Malaysia, and Thailand. The challenge is great compared to our neighbors because of our geography. It is easier for mainland countries to install fiber optics, whereas in our case, the cables have to cross large, open bodies of water. The investment to connect all islands by 2019 is USD1.5 billion. We built this with PPPs because we want the private sector participating in this space. By the second half of 2018 we will make a decision on our own satellite; this will be the leapfrog. In Indonesia we need a high-speed satellite because we have to connect around 220,000 schools at the primary and secondary levels and thousands at the tertiary level. We have to connect 75,000 village offices and 10,000 villages hospitals. We have already incorporated this plan into our National Strategic Project; the president has signed the decree. However, we want to position Indonesia to become number two in the region. We cannot compete with Singapore because it is a small island. However, by 2019 Jakarta will be more competitive. There will not be much difference between Singapore and Jakarta from an ICT point of view.

How can you help create a climate that supports entrepreneurship in terms of start-ups?

We aim to have 4G and smartphone devices cost around USD30 by 2019. We want access for everyone. Access to more affordable technologies relates as well to start-ups. We have to provide the room for people to innovate as much as possible. That is why in our ministry, start-ups do not need to get permits or licenses; the only need to register. We need to give start-ups a chance to develop and see what they can do before we regulate. We have to open the room so that people can come up with something completely out of the box. It is not necessary to create a difficult process that is complicated to deal with. This has been my policy since joining the ministry.

The decree for the National Cyber and Encryption Agency (BSSN) was ratified in June 2017. How would you assess the establishment of this agency so far?

We are working with the government to appoint the chairman of BSSN. This agency deals with cybersecurity and cryptographs. Indonesia is open for foreign investment. The executive director of Alibaba, Jack Ma, is an e-commerce advisor of the government. People are more likely to listen to his opinion of what Indonesia has done to support the growth of the digital industry. Secondly, we want Ma, as a guru, to develop Indonesia as the base of talent development for the region. We also want to help universities focus more on technology. With this combination, foreign investors will be able to see Indonesia as more than the market but also the base for conducting business in the region. Indonesia represents over 40% of Asia’s economy and the population, which is why we deserve to become the base for investors and foreign business from outside the region.



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