Indonesia proposes injecting US$3.7 billion into state firms in 2024, 2025

INDONESIA’S government has proposed to top up investment in state companies by US$3.7 billion in 2024 and 2025, including for construction companies to finish infrastructure projects, a cabinet minister said on Tuesday (Mar 19).

The proposals were presented by State-Owned Enterprises (SOEs) Minister Erick Thohir to a parliamentary commission overseeing state investments. They need to be approved by lawmakers before they are executed.

The total amount of the proposals for 2024 is 13.6 trillion rupiah (S$1.2 billion) for seven companies, while the proposed capital injection in 2025 amounts to 44.25 trillion rupiah for 16 companies.

The government’s original plan for 2024 capital injection is worth 28.2 trillion rupiah.

Four major construction firms are some of the intended recipients. Hutama Karya, which has been building a toll road the length of Sumatra island, is to receive the bulk of the capital injection, worth an additional 1.6 trillion rupiah in 2024 and 13.9 trillion rupiah in 2025.

In 2025, Adhi Karya will get 2.1 trillion rupiah, Wijaya Karya two trillion rupiah and PT PP 1.6 trillion rupiah, under the proposals.

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State electricity company Perusahaan Listrik Negara is to receive three trillion rupiah for powering villages, according to the ministry’s proposals for 2025.

Erick said he has put forward the proposals despite an expected change in the presidency in October following last month’s elections, to ensure the completion of projects.

“We brave ourselves to propose the 2025 capital injections in the hope that we can sustain ongoing programmes and so that they can be recorded from this year,” he said.

The presumed winner of the presidential election, Defence Minister Prabowo Subianto, has campaigned on the platform of continuing President Joko Widodo’s programmes, including the incumbent’s massive infrastructure push. REUTERS