Jakarta, INTI - The information and communication (ICT) sector grew by 6.97% year-on-year in Q2 2026, becoming one of the key contributors to Indonesia's economic growth. However, the expansion largely reflects stronger performance in the service or non-tradable sector, rather than manufacturing industries that generate higher added value and create more employment opportunities.
Researcher at the Institute for Development of Economics and Finance (Indef), Ahmad Heri Firdaus, said Indonesia's economic growth structure remains heavily dominated by the service sector.
"Indonesia's economic growth in the second quarter was mainly driven by the non-tradable sector, which does not directly produce physical goods, high-value-added products, or manufacturing output. The growth of the service sector has been relatively strong," he said during a virtual public presentation on Thursday, August 6, 2026.
Previously, Indonesia's Central Statistics Agency (BPS) reported that the ICT sector expanded 6.97% annually in Q2 2026. BPS Deputy for Statistics Balance and Analysis Moh. Edy Mahmud explained that the growth was supported by increased digital economic activities, including the expansion of data center capacity and wider adoption of telecommunications services across healthcare, education, trade, and other sectors.
Indef researcher Izzudin Al Farras noted that the growth of the ICT industry has the potential to accelerate Indonesia's digital economy while attracting more investment, particularly in the data center sector.
However, he pointed out that data centers are highly capital-intensive industries, meaning their contribution to job creation remains relatively limited.
"Data centers require highly skilled workers. In the future, the industry may have the potential to recruit foreign workers," he said.
Farras highlighted the existing skills gap between local talent and the industry's workforce requirements. If domestic talent cannot meet demand, data center operators may recruit foreign professionals, which is permitted under current regulations.
"If these needs cannot be fulfilled by local workers, data centers operating in Indonesia may have to recruit foreign talent. This is allowed by regulation, but we must carefully consider the broader impacts," he added.
Public Companies Expand Into Data Center Business
The growing data center market has attracted attention from several companies listed on the Indonesia Stock Exchange (IDX).
PT NexAI Digital Infrastruktur Tbk (MGLV), for example, has transformed its business from a home appliance company into a data center developer. The company was previously known as PT Panca Anugrah Wisesa Tbk.
Other publicly listed companies have also entered the sector, including PT Dunia Virtual Online Tbk (AREA), PT Indointernet Tbk (EDGE), PT Data Sinergitama Jaya Tbk (ELIT), PT Telkom Indonesia (Persero) Tbk (TLKM), PT Multipolar Technology Tbk (MLPT) through PT Graha Teknologi Nusantara (GTN), PT DCI Indonesia Tbk (DCII), and PT Dian Swastatika Sentosa Tbk (DSSA).
Indonesia Emerging as a Data Center Investment Hub
The industry's strong outlook is also reflected in research from Cushman & Wakefield, which shows that Indonesia currently has 468 MW of operational data center capacity, with an additional 1,957 MW expected to become operational by 2030.
In the long term, the expansion is supported by approximately 4.5 GW of secured capacity through land banks, positioning Indonesia as one of the fastest-growing data center markets in the Asia-Pacific region.
Growth is being driven by increasing cloud adoption, accelerated digital transformation, rising demand for artificial intelligence (AI), high-density computing, and expansion from global hyperscalers.
During the first half of 2026, several investors, including Princeton Digital Group (PDG), Digital Edge, ST Telemedia Global Data Centres (STT GDC), DCI Indonesia, Racks Central, and Firmus Technologies, announced new projects or expansion plans in Greater Jakarta and Batam.
Pritesh Swamy, Head of Data Centre, Research & Advisory Asia Pacific at Cushman & Wakefield, said Indonesia's data center market is entering a new phase of growth.
"Success amid current market dynamics will increasingly depend on securing strategic locations, ensuring power availability, maintaining connectivity, and implementing sustainable development strategies to meet user demands while supporting long-term growth objectives," he said.
According to Cushman & Wakefield, Greater Jakarta (Jabodetabek) remains the primary hub for hyperscale data center development, while Batam is emerging as a strategic location for AI infrastructure and high-performance computing.
The growing demand has also boosted industrial land activity. Cushman & Wakefield recorded 106 hectares of net industrial land sales in H1 2026, with the figure projected to increase to approximately 250 hectares by the end of the year. Demand continues to be dominated by data center development and domestic manufacturing sectors.
Conclusion
Indonesia's ICT sector growth highlights the accelerating demand for digital infrastructure, particularly data centers. While the industry presents significant investment opportunities and supports digital transformation, developing skilled local talent will be essential to maximize its economic impact and workforce benefits.
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