Jakarta, INTI - Indonesia needs to strengthen the foundations of its Artificial Intelligence (AI) ecosystem to ensure it becomes more than just a consumer or market for AI technologies. By developing critical capabilities across the AI value chain, the country can position itself as a strategic player in the global AI supply chain. These foundations include reliable energy infrastructure, data centers, semiconductor manufacturing, computing capacity, and a highly skilled digital workforce.
"We have spent too much time focusing on the downstream side while overlooking the upstream sector. Downstream represents the end products, which may suit countries that primarily serve as technology markets. However, upstream AI infrastructure is far more critical," said Deputy Minister of Communication and Digital Affairs Nezar Patria during the Workshop on AI Infrastructure Readiness, Regulation, and Socio-Economic Impact in Indonesia held in Central Jakarta on Tuesday, 14 July 2026.
According to Nezar Patria, global competition in AI is no longer driven solely by the ability to develop applications. Instead, leadership increasingly depends on control over enabling infrastructure, including energy resources, data centers, semiconductor chips, computing power, and digital talent.
Building a Competitive AI Ecosystem Through Collaboration and Talent
He emphasized that Indonesia has significant potential to become part of the global AI supply chain by leveraging its abundant natural resources, particularly its substantial silica sand reserves, which are an essential raw material for semiconductor production.
"Indonesia has a strong opportunity to enter the global supply chain. Semiconductor manufacturing requires silica sand, and Indonesia possesses approximately 340 million tons of silica sand reserves," he explained.
Nezar stressed that these resources should be maximized through downstream industrialization policies to increase value creation while strengthening Indonesia's competitiveness within the global AI industry.
"Downstream industrialization is more than just a slogan. It is a strategic effort to process minerals and other raw materials into higher-value products. This is a critical agenda that must be implemented by all stakeholders, especially within the rapidly evolving electronics industry," he said.
He further noted that close collaboration among government, industry, and other stakeholders is essential to developing a robust AI infrastructure ecosystem and enhancing Indonesia's strategic position in the global supply chain.
"Building our bargaining power requires collaboration across the entire infrastructure ecosystem. We must create strategic choke points. In the semiconductor industry, countries that control key supply chain bottlenecks will have the greatest influence over the global market," he stated.
Beyond infrastructure, Nezar highlighted the importance of developing digital talent to strengthen Indonesia's competitiveness in AI. He emphasized that a highly skilled workforce will be a decisive factor in enabling the country to capitalize on future AI opportunities.
"The future of AI is being written in Asia, and Indonesia has an important role to play in that story. The policy decisions we make today will determine who benefits from AI in the years ahead," he concluded.
Conclusion
Strengthening AI infrastructure, advancing downstream industrialization, and developing digital talent are essential for Indonesia to become a competitive player in the global AI ecosystem. By investing in these strategic areas and fostering collaboration across sectors, Indonesia can move beyond being a technology market and establish itself as an important contributor to the future of artificial intelligence.
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