Jakarta. Indonesia’s sovereign wealth fund Danantara is reshaping how the nation funds its state-owned enterprises (SOEs), shifting away from traditional state budget injections toward a profit-driven model. This year, Danantara will manage Rp150 trillion ($9.2 billion) in dividends from SOEs --funds that will be reinvested into strategic sectors instead of flowing directly into the state coffers.

Dony Oskaria, Chief Operating Officer of Danantara, said the funds, sourced from dividends paid by state-owned enterprises (SOEs), will be redeployed to support long-term investment rather than returned to the state budget.

“The dividends come from all SOEs, and these will become part of our investment portfolio. The amount is around that (Rp150 trillion),” Dony told reporters in Senayan, Jakarta.

President Prabowo Subianto has projected that total SOE dividends could reach Rp 300 trillion in 2025. However, this figure sharply contrasts with the government’s formal target of just Rp 90 trillion in SOE dividends for 2025, slightly up from Rp 86.4 trillion in 2024.

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Dony also confirmed a major shift in how capital injections to SOEs are now handled. Under the new system, injections no longer pass through the state budget (APBN) and parliamentary approval but are directly allocated by Danantara based on the financial performance and business needs of each SOE.

“There’s no more traditional state capital injection. Instead, we’ll use equity generated from other SOEs’ profits,” Dony explained. “We carefully assess the recipient SOE’s business plan, industry outlook, and ensure the process is transparent and based on strict parameters.”

Danantara, launched earlier this year as Indonesia’s sovereign investment authority, is tasked with optimizing state capital and SOE returns. The agency is designed to function like Singapore’s Temasek or Malaysia’s Khazanah, with a focus on recycling capital and attracting foreign co-investment.

Danantara CEO Rosan previously highlighted the critical role investment plays in achieving Indonesia’s growth target of 8 percent by 2029. He said investment already contributes 29 percent to GDP, second only to household consumption, and should be further expanded.

“Over the past decade, total investment reached Rp9,100 trillion. We aim to push this to Rp13,000 trillion over the next five years,” Rosan said in a written statement recently. He added that Danantara plans to manage assets worth up to Rp15,000 trillion.

Unlike past models reliant on direct state funding, Danantara’s operations are financed through retained SOE dividends, which are now reinvested rather than absorbed into general government revenue.

“Previously, dividends went straight into the treasury. Now, we can reinvest them into sectors that generate quality jobs,” Rosan said. He added that Danantara aims to multiply investment impact up to five times through co-financing schemes with private and global partners.