DANANTARA NEW SOVEREIGN WEALTH FUND OF INDONESIA
On 25 March 2025
The President of the Republic of Indonesia, Prabowo Subianto, has officially inaugurated the new sovereign wealth fund, Danantara. The inauguration held on February 24, 2025 at the Jakarta Presidential Palace.
Badan Pengelola Investasi Daya Anagata Nusantara (“DANANTARA”) is the term that used for the new sovereign wealth fund. The truly definition of Danantara is quite exquisite, since the term is purposed as reflection of Indonesia’s economic future. Daya means strength, Anagata means future, and Nusantara means Indonesian homeland.
DANANTARA OVERVIEW
Danantara was intended to be an institution that will manage assets with an initial fund of USD 20 billion. And it aims to manage assets totaling over USD 900 billion. Danantara will carries out some functions similar to several sovereign wealth fund that owned by other countries, such as China Investment Corporation of China and Temasek Holdings of Singapore.
Danantara was created under the newly amended Law No. 19 of 2003 on State-Owned Enterprises (“SOE”) (referred to as the “SOE Law”), which was amended for the third time, along with the enactment of Government Regulation No. 10 of 2025 on the Investment Management Agency of Daya Anagata Nusantara (“GR No.10/2025”). In accordance to Article 3G paragraph (3) SOE Law, Danantara will have a minimum initial capital of IDR 1,000 trillion. For the initial stage as a super-holding, Danantara will manage 7 (seven) SOEs:
PT Bank Rakyat Indonesia (Persero) Tbk, state bank with the value of approximately IDR 1,865 trillion (2023);
PT Perusahaan Listrik Negara (Persero), state electricity company with the value of approximately IDR 1,670 trillion (2023);
PT Pertamina (Persero), state oil-gas company with the value of approximately IDR 1,404 trillion (2023);
PT Bank Negara Indonesia (Persero) Tbk, state bank with the value of approximately IDR 1,029 trillion (2023);
PT Telkom Indonesia (Persero) Tbk, state telecommunications company with the value of approximately IDR 287 trillion (2023); and
PT Mineral Industri Indonesia (MIND ID), state mining industry with the value of approximately IDR 259 trillion (2023).
As mentioned in the SOE Law, Danantara will take roles in optimizing SOE’s assets and investing in various sectors in order to give sustainable impacts. Danantara also appointed members for the governing bodies that have been enacted since the issued of Presidential Decree No. 30 of 2025 on the Appointment of Danantara’s Supervisory Board and Managing Board, as follows:
Advisory Board, will serves by Indonesia’s former presidents, Susilo Bambang Yudhoyono and Joko Widodo that will provide inputs and advices to the Danantara.
Supervisory Board, will leads by Erick Thohir (current Minister of SOEs), alongside Sri Mulyani Indrawati (current Minister of Finance) as the member, that will in charge of supervising the implementation of the Danantara carried out by the Executive Board.; and
Executive Board, will leads by Rosan Perkasa Roeslani (current Minister of Investment and Downstream Industry) as CEO, Doni Oskaria as COO, and Pandu Patria Sjahrir as CIO that will in charge of operational management of the Danantara;
the board will report directly to the President of the Republic of Indonesia, Prabowo Subianto, to ensure checks and balances, also Danantara can only dissolved by law.
As a sovereign wealth fund, Danantara will act as the SOEs' Executor. Therefore, according to Article 3F SOE Law jo, Article 4 GR No. 10/2025, Danantara will have the authority to:
manage SOEs;
organize dividends from investment and operational holding;
approve or deny state capital participation to SOEs;
together with Minister of SOE establishes the Investments Holding and Operational holding;
together with the Minister of SOE approve the proposal for write-off of SOE assets proposed by the Investment Holding or Operational Holding;
provide loans, receive loans, and pledge assets with the approval of the President; and
ratify and consult to the organs of the House of Representatives in charge of SOE on the Work Plan and Budget of the Investment Holding Company and Operational Holding.
With the establishment of Danantara, the existing sovereign wealth fund, Indonesia Investment Authority (“INA”) will expect to be consolidated into Danantara. With the consolidation aims to attract more of foreign direct investment to Indonesia.
CONCLUSION
In conclusion, Danantara is expected to make an impact on the Indonesian economic landscape and investment ecosystem. Its ability to manage state assets, attract foreign investments, and stimulate economic growth is significant. However, the success of the sovereign wealth fund hinges on its governance, transparency, and the effective management of risks such as corruption and political interference. By ensuring rigorous checks and balances, enforcing strong anti-corruption measures, and adhering to the legal framework set out by the SOE Law, GR No. 10/2025, and Presidential Decree No. 30, Danantara has the potential to be a powerful engine for long-term national development. It will be interesting to see whether Danantara can strive to increase investment returns or whether it is merely a grand ambition of the new government.
PRP Law Firm offers range of services for the investment companies seeking to have opportunities with Danantara, in order to ensure proper and secure documentation.
Regards,
PRP Law Firm.
