Jakarta, INTI - Deputy Minister of Communication and Digital Affairs, Nezar Patria, warned Indonesia not to be late in entering the global artificial intelligence (AI) industry supply chain.
According to him, AI competition is no longer just about application development, but it has shifted to a struggle for control of semiconductors, data centers, and critical minerals that will determine a country's position in the global digital economy.
"The most important thing is not to be late in entering the global supply chain, including AI," said Nezar on Wednesday, July 22, 2026.
AI Adoption in Indonesia is Increasing
He explained that startup development is currently undergoing a paradigm shift. Previously, many startups focused on valuation and aggressive growth. Now, the focus has shifted to building sustainable businesses with strong foundations.
Nezar also highlighted an example of India's experience where its government’s effort in strengthening the startup ecosystem, the Make in India policy, and the development of the semiconductor industry can encourage the birth of new AI-based innovations.
"AI is now becoming a driving force for startup growth," he added.
Nezar believes Indonesia has significant potential to compete in the AI industry, with the high adoption of AI, the growth of AI-based startups, and the emergence of national large language model (LLM) development initiatives being important foundations for AI sovereignty.
However, he cautioned that Indonesia is still in the technology utilization stage and therefore needs to strengthen national capabilities through collaboration with various stakeholders. Mastering AI also requires the support of digital infrastructure, particularly data centers, Graphics Processing Units (GPUs), and the semiconductor industry.
Indonesia Should Optimize Downstream
Indonesia also has significant resources from its critical minerals, such as nickel and silica sand, that need to be processed downstream to add value to the national technology industry. The two minerals are important materials in semiconductor manufacturing.
"Downstreaming these raw critical minerals into intermediate products will strengthen our position in the global supply chain in the semiconductor industry," he explained.
The government is currently preparing an AI Roadmap and a Presidential Regulation as a reference for national AI development. The regulation is drafted using a risk-based approach to maintain the space for innovation while ensuring the responsible use of AI.
Conclusion
Deputy Minister of Communication and Digital Affairs Nezar Patria reminded Indonesia not to be late in entering the global AI industry supply chain. Global AI development now also expands to mastery of semiconductors and data centers. The government needs to strengthen the startup ecosystem, digital infrastructure, the semiconductor industry, and the downstreaming of minerals such as nickel and silica sand to improve Indonesia's position in the global technology supply chain.
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