IN THE heart of South-east Asia, a metamorphosis is underway. As an investor, I’ve had the privilege of witnessing first-hand the transformation happening within the Indonesian automotive sector. This change is driven primarily by the rapid rise of the country’s middle class and a swell in urbanisation, factors that are fuelling an unprecedented demand for personal vehicles, despite the prevalence of ride-hailing in major cities like Jakarta and Surabaya. But it’s not just any set of wheels that the urban Indonesians are yearning for; the spotlight is squarely on electric vehicles (EVs).

Let’s zoom out for a moment. The allure of Indonesia extends beyond its potential market size. This archipelago is blessed with abundant natural resources, including nickel – a critical ingredient for EV battery production. We currently account for more than 37 per cent of global nickel production and more than 22 per cent of global reserves. It’s a strategic advantage that puts Indonesia in a unique position to become a significant player in the global EV landscape.

But the story doesn’t end there. The government has bolstered its commitment to reducing greenhouse gas emissions. It set a new target to cut emission levels by 31.9 per cent on its own or 43.2 per cent with international support by 2030. This is bolder than its Paris Agreement pledge, which was to cut emissions by 29 per cent or 41 per cent with international help. Vehicles on the streets currently account for 20 per cent of all carbon emissions in Indonesia.