Sector
Transportation
With a population exceeding 280 million people, Indonesia relies heavily on a robust transportation network encompassing sea, air, and land routes to connect its vast island chain and facilitate economic activity effectively. This reliance has made the transportation sector a leading sector in the country.
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Transportation
With a population exceeding 280 million people, Indonesia relies heavily on a robust transportation network encompassing sea, air, and land routes to connect its vast island chain and facilitate economic activity effectively. This reliance has made the transportation sector a leading sector in the country.
In 2022, the sector contributed Rp 983 trillion to the national gross domestic product (GDP) at current prices. Notably, regions where transportation is a leading sector include Aceh, West Sumatra, Bengkulu, Lampung, West Java, the Special Region of Yogyakarta, and Central Kalimantan. Additionally, North Kalimantan, Gorontalo, North Sulawesi, Maluku, East Nusa Tenggara, and Bangka-Belitung consider the transportation sector as a leading sector.
The sector has also experienced a significant boost in recent years, with the transportation and warehousing subsector achieving a staggering GDP growth of 15.93 percent year-on-year (YoY) in the first quarter of 2023.
During the COVID-19 pandemic, Indonesia’s auto industry was severely affected, leading to a decline in both vehicle sales and production. Despite this decline, the transportation sector as a whole continued to attract foreign direct investments (FDI). In 2023, foreign companies poured roughly US$2 billion into the country’s vehicle and other transportation subsectors, highlighting the continued potential that investors see in this sector.
In terms of land transportation, infrastructure projects supporting rail transport such as the Light Rail Transit (LRT), started operations in mid-August 2023. Additionally, the development of Phase 2 of the Mass Rapid Transit (MRT) Jakarta, which includes new routes, is currently underway, with 6 kilometers already completed out of a total of 13.3 kilometers. Moreover, railway transportation saw a year-on-year increase of 69.37 percent in the number of passengers nationwide.
Sea transportation is also an important subsector of the transportation industry, primarily due to the trade sector’s heavy dependence on this mode of transportation. It is highly favored for its perceived economic efficiency in transporting goods. Although sea transport may not be the main method of transportation for many individuals, the number of passengers using sea transport in 2023 increased by 13.30 percent compared to the previous year.
Furthermore, air travel in Indonesia continues to rise with the increase in economic activity. The number of passengers using domestic air transportation increased by 32.69 percent year-on-year. Additionally, Soekarno Hatta International Airport has surpassed Singapore’s Changi Airport to become Southeast Asia's busiest airport in April 2024. According to reports, the airport's flight seat capacity has also reached 3.34 million, the highest among airports in the Southeast Asia region.
Latest News
Beef retailers have gone on strike in protest over the rising price of live cattle set by feedlot operators. While the increase is partly attributed to supply losses caused by flooding in Australia, Indonesia’s largest source of imported cattle, the Agriculture Ministry suspects foul play among feedlot operators, alleging that they are maintaining elevated prices to secure higher margins. This comes as the government earlier this month slashed the private sector’s beef import quota from 180,000 tonnes last year to just 30,000 tonnes.
Price data point to sustained pressures along the supply chain. The average national price of live cattle at the feedlot level stood at Rp 52,941 (US$3.14) per kilogram on Jan. 28, according to National Food Agency (Bapanas) data, below the government reference price of Rp 56,000–58,000 per kg. However, at the consumer level, the average national price of hindquarter beef reached Rp 136,720 per kg, approaching the government reference price of Rp 140,000 per kg, suggesting that price pressures remain downstream.
Traders in traditional markets said their purchase price from slaughterhouses had risen sharply, from around Rp 85,000–Rp 90,000 per kg previously to about Rp 110,000 per kg. Several traders said this had pushed their cost of goods sold to roughly Rp 125,000 per kg, forcing them to sell beef at around Rp 130,000 per kg over the past month. As a result, daily sales volumes have fallen significantly, with some traders reporting a drop from around 10 kg per day to just 3 kg.
Against this backdrop, traders and slaughterhouse operators in Greater Jakarta went on strike on Jan. 22–24, after negotiations on live cattle price stability with the Agriculture Ministry and other agencies on Jan. 5 failed to yield a solution. After the strike, the Agriculture Ministry, Bapanas and several associations reached an agreement to keep the benchmark purchase price of live cattle at the feedlot level at Rp 55,000 per kg to stabilize prices and ensure supply ahead of Ramadan and Idul Fitri 2026.
Several importers said they were already under pressure when the benchmark price had been set at Rp 58,000 per kg, as that price had been factored into their procurement plans to secure Australian cattle ahead of the peak Ramadan sales period. With the maximum benchmark price now lowered to Rp 55,000 per kg, they said the margin has become extremely thin, as the price is now close to their actual cost of sourcing cattle from Australia.
Amid mounting scrutiny, the Agriculture Ministry has formed a special task force to investigate alleged price speculation in the Greater Jakarta area. The ministry has warned that it could revoke business or import permits and pursue criminal charges against parties found to be manipulating prices.
The Jakarta provincial administration, however, offered a different assessment, saying it had found no evidence of supply shortages in the capital. Instead, it pointed to rising import costs, noting that the price of live cattle from Australia had increased from Rp 53,000 per kg in November 2025 to Rp 61,000 per kg. The increase had been attributed to rupiah exchange rate fluctuations and tighter supply from Australia, where cattle losses in Queensland reportedly exceeded 100,000 head following Tropical Cyclone Koji. Australia remains Indonesia’s dominant supplier, with beef imports reaching 113,622.94 tonnes in 2024, the highest among all origin countries, according to Statistics Indonesia (BPS).
The impact of higher import costs has been compounded by policy changes. Under the government’s 2026 import policy, the private sector’s beef quota was cut sharply from 180,000 tonnes to just 30,000 tonnes. By contrast, state-owned enterprises received a combined quota of 250,000 tonnes for beef and buffalo meat imports, consisting of 100,000 tonnes of buffalo meat from India, 75,000 tonnes of beef from Brazil, and 75,000 tonnes of beef from other countries.
Industry groups have warned that the policy risks destabilizing the market. The Indonesian Meat Entrepreneurs and Processors Association (APPDI) said the drastic quota reduction could trigger market disruption and potential layoffs.
