Indonesia’s Investment Blueprint: BKPM Offers “Automatic Licenses” and Downstream Partnerships to Indian Investors

JAKARTA, Investortrust.id — At the conclusion of the “India Night 2026” forum, the Indonesian government delivered a clear message to the Indian business community: the regulatory "red tape" of the past is being replaced by an automated, digital-first investment climate. India Night 2026 was hosted by the Embassy of India on January 28, 2026.

The forum, themed “Weaving Collaboration, Driving Investment,” was designed to facilitate "serious business" discussions rather than the traditional cultural performances some attendees expected,. During the proceedings, the Indonesian Ministry of Investment (BKPM) highlighted significant improvements to the Online Single Submission (OSS) system, which now features Service Level Agreements (SLAs) that mandate the automatic issuance of licenses if government agencies fail to process permits within a set timeframe.

This push for a more transparent business environment comes as India has become Indonesia’s third-largest export destination, with bilateral trade averaging $30 billion over the last three years. To further support this growth, the government has extended national tax holiday facilities until 2027 and is offering "super deduction" taxes of up to 300% for research and development spending to attract high-tech Indian investment in sectors such as semiconductors, healthcare, and AI infrastructure

Representing the Minister of Investment and Downstream Industry, Heldy Satrya Putera, the Deputy Minister for Strategic Downstream Investment, outlined a high-stakes roadmap designed to transform Indonesia from a raw material exporter into a manufacturing powerhouse. He invited Indian conglomerates to integrate into Indonesia’s downstream industry roadmap, which identifies 28 high-priority commodities—led by nickel, bauxite, and copper—ripe for domestic processing.

Nickel, Batteries, and the "Super Deduction" Tax

With Indonesia holding 42% of global nickel resources, Heldy emphasized that the nation is no longer content with just mining; it is building a comprehensive EV battery ecosystem. While technology has historically flowed from China, he noted that Indian investors have expressed significant interest in nickel smelting and battery production.

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Beyond heavy industry, the Deputy highlighted lucrative incentives in the "soft" sectors. To improve national education and vocational training, the government is offering a "super deduction tax" of up to 200% for investors developing international schools or vocational programs. For research and development (R&D) spending, that incentive climbs to 300%.

Ending the Licensing Wait: The OSS Revolution

Addressing a long-standing grievance of foreign firms, Heldy detailed the latest overhaul of the Online Single Submission (OSS) licensing system. To provide "certainty," the government has implemented Service Level Agreements (SLAs) with strict time limits.

“If the license takes more time than the period stated... the system will issue the license automatically,” Heldy revealed. This "auto-approve" mechanism currently applies to 16 types of licenses, with plans for further expansion. He also confirmed that the national tax holiday facility has been extended through 2027 to maintain competitive momentum.

Regulatory Hurdles

The forum’s Q&A session turned toward granular regulatory hurdles. Seema Sunghay, a legal practitioner in Jakarta, challenged the Deputy on the Rp 10 billion minimum investment requirement for foreign firms, noting it was a deterrent for consultancy and IT startups.

Heldy explained that while the 10 billion requirement is mandated by the Law of Small and Medium Enterprises to protect local businesses, the actual paid-in capital requirement is lower, at 2.5 billion IDR. He acknowledged the friction and expressed a willingness to discuss potential solutions for the services sector.

Further interaction involved Murali Khrisna Chundru, President Director of ArcelorMittal Nippon Steel (AM/NS) Indonesia, who raised concerns about the domestic steel industry operating at less than 50% capacity due to a surge in imports. Heldy admitted that "dumping" remains a critical issue and stated that BKPM is working with the Ministry of Trade and steel associations to regulate specific imported products and prioritize local production.

A Future in AI and Semiconductors

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In his closing remarks, the Deputy looked toward the "high-tech" future of the bilateral relationship. He identified AI infrastructure (GPUs and Data Centers) and semiconductors as the next frontiers. Despite the complexity of the semiconductor supply chain, he expressed confidence that Indian technology paired with Indonesian resources could create a "stable partnership" for the global south.