Jakarta, INTI - Indonesia's sovereign wealth fund, the Indonesia Investment Authority (INA), is involved in an infrastructure investment in the field of artificial intelligence (AI).
INA is investing in various funds and private companies amid a boom in data center investment. INA, along with its partners, has allocated Rp74.5 trillion to date. INA’s Chief Investment Officer, Christopher Ganis, said in an interview that approximately 30% of the amount is allocated for digital infrastructure.
Christopher explained that INA, which manages more than US$8 billion (equivalent to Rp142.33 trillion), has completed several digital infrastructure deals. This includes its participation in a funding round for DayOne Data Centres Ltd., a spin-off company of Chinese firm GDS Holdings Ltd.
Data Center Investment Global Trend
The fund's commitment to AI infrastructure underscores the global surge in investment in data centers and other players benefiting from the machine learning revolution.
“While a lot of these AI developments are coming outside of Indonesia, it does not mean that’s a trend that we will just skip,” said Christopher.
INA expects the AI boom to benefit Indonesia as companies establish training and research centers in the country, which has one of the youngest populations in Asia. INA's investment portfolio includes data centers with a planned capacity of 74 megawatts (MW) and a 100% occupancy rate, according to its website.
Amid the US and China's competition in the AI space, Christopher said INA will take a "non-bloc" approach to collaborate with various partners.
Christopher said that AI is a sector in a “multipolar world” where countries will seek to create national or regional champions. However, companies will see Indonesia as a market where they can increase their productivity and expand, he added.
Although the conflict in the Middle East is putting pressure on net oil importers like Indonesia, Christopher said existing data centers in Indonesia operate in industrial areas with secure power supplies. However, he remains wary of the potential for further spikes in oil prices.
“I don’t think you can make a broad-stroke statement on the impact,” Christopher said, explaining that the investment fund must evaluate various factors, including future electricity contracts, to determine the impact.
INA, established in December 2020, recently underwent a series of leadership changes. Its peer Danantara, which has a much larger mandate, also plans to invest in data centers.
INA initially focused on private equity investments with a minority shareholding structure, and has since expanded into private credit and real estate.
The vehicle was funded initially with government equity holdings and cash and relied on stock dividends and interest for most of its income. Christopher estimated that this portion will gradually decrease as investment income increases.
Conclusion
The Indonesia Investment Authority (INA) is increasing its investment in AI-related digital infrastructure, particularly data centers. Together with its partners, INA has allocated Rp74.5 trillion, with around 30% directed toward digital infrastructure projects. INA believes Indonesia’s young population and growing digital economy make the country attractive for AI training and research facilities. INA also emphasized a “non-bloc” strategy amid US-China AI competition, seeking partnerships from multiple countries while positioning Indonesia as a key regional growth market.
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