AI Factory strengthens Indonesia’s position as regional AI hub : Govt

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2 hours ago

Jakarta (ANTARA) – Indonesia’s communications minister said on Friday a planned artificial intelligence factory backed by Indosat and global technology partners would strengthen the country’s position as a regional AI hub and attract high-value investment.

Communications and Digital Affairs Minister Meutya Hafid spoke after the launch of Zankore, a partnership between Indosat Ooredoo Hutchison, Ooredoo Group, Nokia and NVIDIA to develop an AI Factory in Indonesia.

The project is expected to reach one gigawatt (GW) of computing capacity within three years, making it Southeast Asia’s largest AI computing infrastructure project, according to the ministry.

“The presence of the AI Factory will strengthen Indonesia’s position as a regional AI hub because it will be able to serve both domestic and regional demand,” Meutya said.

“The investment reflects growing global confidence in Indonesia’s digital economy while reinforcing the country’s position as a destination for high-value technology investment,” she added.

An AI Factory is a large-scale computing infrastructure that provides the processing power needed to develop, train and operate artificial intelligence applications and services.

Unlike conventional data centers, it integrates the AI value chain into one ecosystem, including AI-ready data centers, graphics processing units (GPUs), networking, data storage, orchestration, workload management and AI operations.

Industry estimates show a full-scale AI Factory requires about US$50 million in investment for every one megawatt (MW) of AI computing capacity, highlighting the project’s capital-intensive nature.

Construction is scheduled to begin in the first half of 2027 in Batang, Central Java, with an initial capacity of about 200 MW before expanding to one GW, Meutya said.

She said the government had supported the project since it was first proposed two years ago and later presented to President Prabowo Subianto.

“The entire process has now reached its final stage and can be officially announced to the public,” Meutya said.

Besides the computing infrastructure, Zankore will develop Sahabat-AI, an open-source large language model with 70 billion parameters supporting Bahasa Indonesia and regional languages including Javanese, Sundanese, Balinese and Batak.

The platform will also provide Token-as-a-Service, allowing businesses, government agencies, developers and the public to access AI computing services at lower cost.

Meutya said investment in AI infrastructure was critical to strengthening Indonesia’s competitiveness and building a national AI ecosystem spanning computing capacity, AI services and locally developed language models.

She added that Indonesia’s first GPU manufacturing facility, under construction in Cikarang, West Java, is scheduled to open in December 2026, strengthening the domestic AI supply chain.

Indonesia’s large domestic market, expanding energy capacity and supportive policies provide a strong foundation for becoming a regional AI development hub, Meutya said.

“The government will continue to ensure a conducive investment climate so AI innovation can thrive while delivering tangible benefits to society,” she said.