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.
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Domestic workers work long hours and do all kind of chores for low wages and have little or no legal recourse in case of harassment or abuse, as they are completely at the mercy of their employers, or “masters” in this system of modern slavery that persists in Indonesia.
At least, that was until the House of Representatives passed the Law on Domestic Workers Protection (UU PPRT) on April 21. Among the rights and protections it guarantees, millions of domestic workers, mostly women, will gain legal status and recognition for the first time.
The Domestic Workers Protection Bill had lingered at the House for more than 22 years, indicative of a lack of enthusiasm and sense of urgency, not only on the part of legislators but also the general public. President Prabowo Subianto, in his Labor Day address last year, promised the bill would be passed within three months.
The House missed that deadline but enacted the law in time for May Day 2026 with little fanfare, to judge by the scant attention mainstream media gave the milestone legislation. Nevertheless, the new law could impact the way millions of families across the country treat their servants. And therein lies the rub.
While the law lists the various rights and obligations that must be met by all stakeholders, employers, workers and related businesses such as home cleaning services, it falls short on details related to enforcement and more importantly, oversight.
For example, the law mandates a formal employment agreement that outlines the employee’s rights and the employer’s obligations. But any negotiation between the two sides would involve an unequal power relationship and most likely result in an unfair contract for the domestic worker.
Furthermore, the law merely stipulates entitlements such as “decent wages”, “humane working hours”, “breaks and days off” and “holidays” to be determined by mutual agreement and does not set a legal framework.
It does, however, stipulate a minimum age of 18 as well as the provision of health, social and employee insurance for domestic workers. If employers register their servants for such coverage, and that is a big if, the government will contribute a share of the premium and provide social assistance.
The new law does not set a minimum wage or maximum working hours, which would be expected in a labor law.
Though it offers some protection for domestic workers, the new law also protects the interests of domestic employers. Oversight is a critical issue, and the legislation does not make clear who is responsible for contractual enforcement, provided that one is signed, or how violations will be dealt with.
Lita Anggraini, coordinator of the National Advocacy Network for Domestic Workers (Jala PRT), welcomes the new legislation but says it only covers 75 percent of the obligations covered in Convention No. 189 of the International Labor Organization.
The treaty guarantees domestic workers the same basic rights as all other employees and sets standards for fair working conditions, including reasonable working hours, weekly rest and protection from employer abuse.
Jala PRT said it received 1,184 reports on violence against domestic workers, including 26 cases of sexual violence in 2025, though it noted that many more cases of violence went unreported.
Domestic workers are typically tasked with cleaning, washing clothes, cooking, babysitting and accompanying children to and from school. In the absence of legal protection, it is not uncommon for them to be subjected to bullying, harassment and worse at the hands of employers or their family members. The way domestic workers in Indonesia are treated, with long hours, meager pay and harsh working conditions, sometimes involving abuse, their employers would be liable under antislavery laws in Western countries. But no one in Indonesia is talking about phasing out these jobs or introducing antislavery legislation.
The ILO estimates that as many as 5 million Indonesians, mostly women, are employed in domestic service. Millions also work in this sector abroad, including in Hong Kong, Malaysia, Saudi Arabia, Singapore and Taiwan. In fact, the Indonesian government has insisted on overseas employers signing contracts with specific salaries and working hours as well as legal protections in some of these countries.
Ironically, many civil society organizations that are actively demanding protections for Indonesian migrant workers abroad are less passionate about or simply turning a blind eye to legal protections for domestic workers at home.
The Domestic Workers Protection Law promises to improve the lot of domestic workers but not much beyond legal recognition. Urban Indonesians need housemaids, and want them cheap.
