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 moreTransportation
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
It is hard to conceive of a national political landscape without constant maneuvering among political parties, trying to shape its direction. Recent speculation over a potential unification of the NasDem Party and Gerindra Party has brought a recurring question to the forefront: Do parties function as institutional channels of representation, or have they become mere instruments of elite bargaining?
The issue escalated into a controversy on April 14, when hundreds of NasDem Party supporters rallied outside Tempomagazine’s office in West Jakarta. They had gathered to protest a cover story featuring party chairman Surya Paloh, which alluded to a possible merger between NasDem and President Prabowo Subianto’s Gerindra Party. NasDem swiftly rejected this characterization, insisting that the discussions concerned the formation of a “political bloc”: a looser yet potentially more durable configuration of power compared to a “merger”.
The discourse had gained traction following reports of a closed-door meeting in mid-February between the two political bigwigs at Prabowo’s private residence in Hambalang village, West Java. Gerindra executive chairman Sufmi Dasco Ahmad confirmed the meeting took place, but insider accounts suggested their discussion was far from informal, reportedly covering a proposal to raise the parliamentary threshold from 4 percent to 8 percent. According to these sources, the pair also discussed Surya’s stalled business ventures, specifically the Indonesia 1 twin towers project in Central Jakarta.
At the center of their meeting, however, was a political agenda: formalizing deeper cooperation that could evolve into a more consolidated arrangement. In fact, NasDem and Gerindra share a similar historical lineage: both were founded in the wake of post-reform internal fractures in the Golkar Party.
From a political economy perspective, these discussion areas are not incidental. They reflect a convergence of electoral strategy, regulatory engineering and economic interests, a pattern that has long characterized Indonesia’s party system.
At first glance, NasDem’s openness to forming a stronger political bloc appears paradoxical, as its electoral performance indicates increasing stability rather than a decline. Since its establishment in 2011, the party has demonstrated consistent growth: NasDem secured 6.68 percent (35 seats) of the vote in the 2014 election, increased its share to 9.05 percent (59 seats) in 2019, and gained 9.66 percent (69 seats) in 2024. Among mid-tier parties, this trajectory positions NasDem as one of the most resilient players.
NasDem also has significantly outperformed its peers. The Democratic Party, for instance, has experienced a steady decline since its 2009 peak, with its vote share falling to 7.43 percent in the last election. Meanwhile, the United Development Party (PPP), an Islamic outfit that recorded a comparable, albeit slightly higher, share of the votes in 2014, has since lost all seats in the House.
However, electoral strength does not automatically translate into political leverage, and both internal and external pressures have intensified. Several senior NasDem figures, including Ahmad Ali, Bestari Barus and Rusdi Masse Mappasessu, recently left the party to join the Indonesian Solidarity Party (PSI). Led by Kaesang Pangarep, the younger son of former president Joko “Jokowi” Widodo, the PSI reflects the increasing attraction of parties closely aligned with the executive.
NasDem’s long-standing association with Jokowi further complicates its positioning. After supporting Jokowi over two terms, the party endorsed Anies Baswedan in the 2024 presidential election, in opposition to the Prabowo-Gibran ticket. Reports linking this shift to state-owned banks’ withdrawing support for Surya’s Indonesia 1 project illustrate how political alignment can intersect with business ventures, especially with negative impacts for the latter.
Simultaneously, communication missteps have affected the party’s public image. Statements by NasDem lawmakers Ahmad Sahroni and Nafa Urbach were widely criticized for their apparent dismissiveness toward public concerns, intensifying scrutiny of the party’s messaging and responsiveness. The two were among the several lawmakers blamed for triggering the mass protests in August last year and were suspended for several months.
Taken together, these developments suggest that Prabowo and Surya’s discussion around a potential unification, whether “merger” or “political bloc”, is less about electoral survival and more about strategic repositioning within a changing power configuration.
The proposal to increase the legislative threshold reinforces this interpretation. Surya has advocated for raising it to 7 percent, arguing this would streamline the legislative process. However, because this figure closely mirrors NasDem’s average performance, the proposal appears to be based on careful political calculation rather than purely on institutional reform.
NasDem’s current developments therefore reflect a broader pattern in national politics: Maneuvering is rarely about ideological alignment, but rather about recalibrating access to power. Whether framed as a coupling or cooperation, they illustrate how parties continue to operate at the intersection of electoral strategy, elite negotiation and institutional design.
