Indonesia Infrastructure Market

Indonesia Infrastructure Market Size Report – In a Glance

As per the survey report on Indonesia infrastructure market, the market is expected to foresee a CAGR value of 5.16% during 2025-2035, and further generate a market size of USD 50.86 billion by the end of 2035. In 2024, the market size was value at USD 35.0 billion revenue.

• The Indonesia infrastructure market’s growth is driven by rapid urbanization and government supportive policies.
• KDMI analyst’s growth analysis foresees limited financing options and regulatory challenges as restraint for Indonesia infrastructure market.

Indonesia Infrastructure Market Analysis

The term infrastructure refers to basic framework of systems, services, and facilities which are necessary in region, country, and organization to seamlessly function and operate. Infrastructure can be categorized into hard or physical structures such as roads, bridges, power plants, and water systems, and soft structures like institutions and human capital in sectors such as healthcare, education, emergency services, and others. Proper infrastructural development is necessary for economic growth, social welfare, and enhancement of life quality. According to study reports, in 2021, about 31 thousand fatalities in Indonesia happened due to road crashes, accounting for 2.0% of all deaths in the region. IRAP ratings shows that only 7% and 14% of Indonesia’s road infrastructure have 3-star or better rating for pedestrians and bicyclists, respectively. Growing concern for road safety is driving demand for infrastructure re-development, leading to expansion of Indonesian market.

Indonesia Infrastructure Market Growth Drivers and Restraints

Growth Drivers

• Government supportive policies and initiatives – The Indonesian government offers support for development of infrastructure in the country, with backing it as the backbone of its entire economic growth strategy. Governmental initiatives such as National Medium-Term Development Plan (RPJMN) supports infrastructure development by providing financial support in building highways, airports, ports, power plants, and industrial zones. Moreover, government also promotes public-private-partnership (PPP) to encourage investments from private sectors and organizations, which reduce burden from state budget and thus, drives the high-end development of infrastructures. These policies and support enhance connectivity between nations and lower logistics costs, making Indonesia more competitive in the trade market.
• Rapid urbanization and rising demand for modern infrastructure – Another major driver for Indonesia infrastructure market is rapid urbanization and growing demand for modern infrastructure. With over 70% of population residing in urban areas, demand for modernized infrastructure in cities by adopting Industry 4.0 and is shifting people preference towards digitalized solutions. This demographic shift is majorly seen in metropolitan cities like Jakarta, Surabaya, and Bandung. Urbanizations drive need for modern housing, efficient transit system, clean water supply, and much more, which is pushing towards increased investment into sustainable urban infrastructure solutions.

Restraints

• Limited financing options and regulatory challenges – The major hurdle for Indonesian infrastructure market is financial challenges, which are critical bottlenecks for infrastructure development. Large-scale projects often demand higher investment that may exceed allocated budget limit by government, putting burden on private organizations and institutions for investment. Stringent regulatory standards pose as a difficulty for foreign investors to invest in region’s economic development, and due to risks associated in foreign investment, limits market growth and leads to lengthy approvals from regulating authority.

Analyst’s Observation on Indonesia Infrastructure Market Recent Developments

Over the years, the experts at KD Market Insights have been observing the recent developments associated with Indonesia infrastructure market trends. Our expert’s market forecast analysis has recorded the market players adopting plentiful of key strategies including new product launches, mergers & acquisitions, and collaborations.

In January 2025, BDx Data Centers have announced its partnership with the Association of Indonesia Internet Service Providers (APJII) to boost nation’s digital infrastructure. The partnership states, APJII will enhance coverage of Indonesia’s Internet Exchange in Greater Jakarta by launching a new IIX node at BDx Indonesia’s CGK 3A campus in Southern Jakarta. The launch of IIX at CGK 3A campus will provide a platform for development of carrier-neutral interconnection ecosystem in the country.

Indonesia Infrastructure Market Competitive Landscape

Some of the significant participants who top the Indonesia infrastructure market share:

• PT Wijaya Karya (Persero) Tbk
• PT Adhi Karya (Persero) TBK
• PT Jasa Marga (Persero) TBK
• PT Indonesia Pondasi Raya TBK
• PT Brantas Abipraya (Persero)
• PT Jagat Konstruksi Adipersada
• PT Kajima Indonesia
• PT Total Inti Persada
• PT Hutama Karya (Persero)
• PT Nusantara Infrastructure Tbk