Jakarta. Indonesia's government debt rose to Rp 10.33 quadrillion ($569.7 billion) at the end of September 2026, up from Rp 10.29 quadrillion three months earlier, although its share of the country's economy declined, the Finance Ministry said Friday.

The debt-to-gross domestic product (GDP) ratio fell to 40.3% in September from 41.26% in June, indicating that the economy's nominal value grew faster than the government's outstanding debt during the period.

Finance Ministry Director General of Budget Financing and Risk Management Suminto attributed the improvement to prudent debt management, stronger economic activity and accelerated government spending.

"This reflects our cautious approach to debt management, a measured financing strategy and strong economic growth," Suminto said in a statement.

"An increase in nominal GDP, supported by domestic economic activity and accelerated government spending, has also contributed to the decline in the debt ratio," he added.

Although the debt stock increased by approximately Rp 40 trillion during the third quarter, the lower debt ratio suggests that the government's borrowing burden has eased relative to the size of the economy.

Government Bonds Account for Nearly 87% of Debt
According to the ministry, government securities, known locally as surat berharga negara (SBN), accounted for Rp 8.96 quadrillion, or 86.78%, of total outstanding debt as of September.

The remaining Rp 1.36 quadrillion, or 13.22%, consisted of government loans.

The figures show that Indonesia relies primarily on bond issuance rather than direct borrowing to finance its budget.

"The government remains committed to maintaining the debt ratio at a manageable level while ensuring efficient state budget financing to support economic growth and fiscal sustainability," Suminto said.

The government has sought to balance its financing needs with efforts to maintain investor confidence and limit risks associated with debt servicing and financial market volatility.

Foreign Ownership of Government Bonds Declines Sharply
Separately, Deputy Finance Minister Juda Agung said foreign investors now hold only around 13% to 14% of Indonesia's government securities, compared with nearly 40% about a decade ago.

The shift reflects the growing role of domestic investors in financing government borrowing, reducing the bond market's dependence on overseas capital.

"Foreign investors now probably hold only about 13% to 14% of government securities. Ten years ago, foreign ownership was nearly 40%," Juda said.

"This certainly reduces vulnerabilities in our money market and foreign exchange market," he added.

A smaller foreign investor share can help reduce the risk of sudden capital outflows destabilizing government bond prices and the rupiah during periods of global financial turbulence.

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