Jakarta. Danantara has floated plans to establish a new committee to prevent Indonesia’s state companies from making bad investment decisions.

The sovereign fund’s chief operating officer Dony Oskaria went on stage on Thursday to flesh out the problems that had plagued Indonesian state-owned enterprises (SOEs). All 1,074 SOEs, including its sub-subsidiaries, are now under Danantara’s wings. Aside from cutting the number of SOEs to just 250 companies for better efficiency, Danantara is also eyeing the poorly made investments.

“Our biggest problem is overinvestment, namely decisions that do not calculate the return on investment. It has put companies in prolonged debt that they can’t pay off,” Dony told Investor Daily Summit in Jakarta.

“That’s why we have to have an investment committee to prevent such things from happening again. Every company must go through this committee who will check whether the investment aligns with its designation and the company's plans. We don’t want any more overinvestments.”

He did not give a timeline for when this team will take shape, including the members. 

According to Dony, Krakatau Steel’s blast furnace project is one of the many investment mistakes by SOEs. The steelmaker halted the facility’s operations in 2019 due to high operational costs. Dony claimed that this had led to a debt of up to Rp 26 trillion or around $1.5 billion. 

Pharmaceutical giant Kimia Farma had also miscalculated its move to aggressively build new factories.

“[Kimia Farma] now has way too many plants, but the utilization rate is only at 40%. This only caused a hike to the debt burden.”

In late 2025, Danantara unveiled a shareholder loan of up to Rp 4.9 trillion (around $273 million) to rescue Krakatau Steel. Earlier this year, Danantara proposed having the pharmaceutical holding Bio Farma let go of Kimia Farma.

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