Jakarta. Indonesia’s mining sector has solidified its role as a backbone of the national economy, consistently contributing to growth even during periods of global disruption while positioning Indonesia as a key player in critical minerals for the energy transition.

Mining contributed 12 percent to Indonesia’s GDP in 2024, up from 10.5 percent the previous year. The sector has remained resilient while other industries faltered during the 1998 Asian financial crisis, the 2008 global financial crisis, and the economic downturn caused by the COVID-19 pandemic in 2020.

“The mining sector has been the backbone that allows Indonesia to keep moving forward,” said Hendra Sinadia, Executive Director of the Indonesia Mineral Association, during the Energy and Mineral Festival in Jakarta on Wednesday.

Amid global uncertainties, including shifting US trade policies, mining continues to support Indonesia’s economic stability. Hendra said that despite negative narratives, mining plays an essential role in daily life, providing raw materials for essential products such as smartphones and laptops. Currently, coal accounts for around 60 percent of Indonesia’s electricity generation, with renewables supplying about 20 percent.

“Without realizing it, the mining sector has made our daily lives easier. The electricity we use and the gadgets we depend on are all made possible by mining,” Hendra said.

Indonesia’s mineral resources have also positioned the country as a global leader in critical minerals. The nation supplied over half of the world’s nickel in 2024, producing 2.2 million tonnes, and is central to the global electric vehicle (EV) battery supply chain. 

In 2024, investment in Indonesia’s nickel sector reached Rp 153.2 trillion rupiah ($9.39 billion), accounting for over 62 percent of total mineral sector investment.

Indonesia’s mining prowess extends to gold and copper, with the Grasberg mine producing 1.5 billion pounds of copper and 1.7 million ounces of gold in 2023, demonstrating the scale of production that underpins its economic contributions.