Indonesia Finance Minister Purbaya Yudhi Sadewa Announces Budget Cuts, Bank Liquidity Boost and Rejects IMF Aid

Finance Minister Purbaya Yudhi Sadewa said the National Nutrition Agency (BGN) will carry out further budget efficiency measures for the Free‑Meals programme, emphasizing that the cuts will not affect the nutritional quality of meals. The programme’s allocation was already reduced from Rp 335 trillion to Rp 268 trillion for 2026, and Purbaya hinted at an additional saving of about Rp 40 trillion.

He also announced that the government will place up to Rp 400 trillion in state‑owned banks (Himbara) in two instalments of Rp 100 trillion each to address tightening liquidity in the banking sector. The move follows a previous withdrawal of part of the Saldo Anggaran Lebih (SAL) that had been held at Bank Indonesia.

Purbaya rejected an emergency financing offer from the International Monetary Fund, arguing that Indonesia’s economy remains robust, with growth above 5 % and a fiscal deficit below 3 % of GDP. He noted that the country still holds a large SAL surplus of roughly Rp 420–590 trillion, eliminating the need for IMF assistance.

Separately, prosecutors extended the detention of former BGN head Dadan Hindayana and two former deputies on suspicion of corrupt procurement linked to the Free‑Meals programme. Investigators allege fictitious purchases and inflated prices for items such as electric motorcycles, shoes, tablets and large‑screen televisions, with kick‑backs channelled to affiliated foundations.