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.
View moreOther Sectors
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
President Prabowo Subianto visited former president and Indonesian Democratic Party of Struggle (PDI-P) chairwoman Megawati Soekarnoputri on the occasion of the Idul Fitri holiday. The meeting on April 7 marked an important rapprochement between the two figures that would define the country’s political dynamics in the future.
Nevertheless, the close encounter, which lasted 90 minutes, did not result in a specific agreement, although further follow-up could be expected.
The long-awaited meeting came after several rounds of lobbying between the PDI-P and Prabowo’s Gerindra Party elites. The two were expected to hold talks before Prabowo took office on Oct. 20 last year, with the hope that the PDI-P would join the grand ruling coalition.
Until today, the PDI-P is the only party that opts to stay out of the government, making it impossible for it to effectively engage the checks and balances mechanism.
Prabowo met Megawati at her residence on Jl. Teuku Umar in the upmarket Central Jakarta area of Menteng. Several PDI-P and Gerindra Party top executives were seen present at the big house, but did not take part in the Prabowo-Megawati conversation.
Prabowo has built a close relationship with Megawati following their collaboration in the 2009 presidential election. Back then Megawati ran for president, with Prabowo as her running mate. The pair lost to Susilo Bambang Yudhoyono, who partnered with Jusuf Kalla.
Despite the flopped presidential bid, Megawati and Prabowo continued their collaboration in the Jakarta election in 2012, which was won by Joko “Jokowi” Widodo of the PDI-P and his running mate Basuki “Ahok” Tjahaja Purnama of Gerindra.
Ties between the PDI-P and Gerindra began to sever after Megawati endorsed Jokowi’s presidential bid in 2014, who eventually beat Prabowo in the divisive, see-saw race. Jokowi prevailed in the rematch in 2019, but brought Prabowo into his government as defense minister.
The PDI-P labeled Jokowi as a traitor for supporting Prabowo, instead of Megawati’s choice of Ganjar Pranowo, in the 2024 presidential election, which Prabowo won. To cap the severed ties between the PDI-P and Jokowi, the party dismissed the former president early this year.
Both PDI-P and Gerindra elites, however, claim that ties between Prabowo and Megawati have remained well-maintained despite the rivalry in the presidential race.
Prabowo and Megawati each have their respective interests, as the former would need support from the PDI-P, which has never declared its clear political stance toward the Prabowo administration, while the latter has to ensure the PDI-P does not get troubled by parties that try to challenge her leadership.
The corruption case involving PDI-P secretary-general Hasto Kristiyanto, who has been arrested by the Corruption Eradication Commission (KPK), is a clear sign for the party to be prepared for any turbulence.
The PDI-P's interest in protecting Prabowo has never been greater, as the party's congress, originally scheduled for April this year, will decide the future of Megawati's leadership.
In addition, Jokowi, who has no political vehicle after having been closely connected to the Golkar Party and ProJo, the largest group of Jokowi’s supporters that has been rumored to be a political party, appreciated the meeting for the sake of the state’s interests.
Sufmi Dasco Ahmad, Gerindra’s executive chairman and House deputy speaker, stated that Prabowo has full independence to meet anyone, including Megawati, and would not need anyone’s permission, including Jokowi’s, to do so. Hence, Prabowo did not notify Jokowi in advance about his meeting with Megawati.
Eddy Soeparno, the National Mandate Party executive, is convinced that the Prabowo-Megawati meeting would signal the PDI-P's support without its direct involvement in Prabowo’s cabinet, the same stance as the NasDem, which has declared its support for Prabowo’s administration without having any of its representatives in the cabinet.
Puan Maharani, House Speaker and Megawati’s daughter, stated that Prabowo and Megawati would have follow-up meetings in the future.
