Indonesia advances industrial growth through leadership changes and mineral downstreaming

Indonesia is undergoing significant economic shifts driven by industrial policy and mineral downstreaming. Muhammad Sarmuji has been officially inaugurated as the Minister of Industry by President Prabowo Subianto, succeeding Agus Gumiwang Kartasasmita. Sarmuji has pledged to utilize the industrial sector as a primary engine for national economic growth and labor absorption, while promising to build upon existing foundations and pursue new breakthroughs.

Parallel to leadership changes, the government’s downstreaming strategy—particularly in the nickel sector—is showing measurable economic impact. Nickel exports and related goods rose by 69.3 percent in the first half of 2026, reaching US$6.54 billion. This has significantly boosted non-tax state revenue, which reached Rp21 trillion by August 31, 2026.

Experts note that while the transition from exporting raw ores to processed products like ferronickel is a successful foundation for industrialization, the next challenge lies in extending the production chain to include battery precursors, cathodes, and final manufacturing. Additionally, the formation of the Coordinating Ministry for Downstreaming and Energy Transition is expected to further accelerate the transformation of mineral wealth into a future energy industry basis.