Indonesia’s health technology startup ecosystem is experiencing unprecedented growth, with ProSpace Indonesia’s Digital Health Report revealing $870 million in venture capital investment during 2024, triple the amount secured in 2023. The funding supports 147 active healthtech startups across telemedicine, health information systems, digital pharmacy, and diagnostic innovation categories.
Telemedicine platforms lead in user adoption, with monthly active users across all platforms reaching 23.5 million. Meanwhile, digital pharmacies have captured 18% of the prescription drug market, significantly expanding access in areas with limited physical pharmacy presence.
“Indonesia’s healthtech sector has evolved from proving basic concepts to demonstrating sustainable business models and meaningful health outcomes,” explains Surya Wijaya, Digital Health Analyst at ProSpace. “The integration with formal healthcare systems has been particularly important for creating lasting impact.”
Artificial intelligence applications show growing clinical adoption, with diagnostic assistance tools now utilized in 320 healthcare facilities nationwide. Meanwhile, electronic medical record systems have been implemented in 63% of hospitals, up from 41% in 2023.
Government policies increasingly support digital health adoption, with telemedicine consultations now reimbursable through the national health insurance scheme under certain conditions. Regulatory sandboxes enable controlled innovation while maintaining patient safety standards.
Challenges include ensuring equitable access across socioeconomic groups and addressing technical interoperability between different healthcare technology systems.
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Indonesia’s medical device market is growing at 12.7% annually according to ProSpace Indonesia’s Healthcare Technology Report, reaching a market value of $2.7 billion in 2024. Domestic manufacturing is expanding rapidly, now accounting for 42% of the market, up from 28% in 2023.
Hospital expansion and modernization drive much of the demand, with diagnostic imaging, patient monitoring systems, and surgical equipment leading sales categories. The national health insurance scheme continues to expand coverage for advanced procedures, stimulating equipment acquisition across public and private facilities.
“We’re seeing a maturation of Indonesia’s medical device ecosystem, with increasing sophistication in both manufacturing and clinical utilization,” notes Dr. Anita Wijaya, Medical Technology Specialist at ProSpace. “Local production increasingly focuses on mid-complexity devices rather than just basic consumables.”
Investment in medical device manufacturing totaled $410 million in 2024, with particular growth in diagnostic equipment, orthopedic implants, and digital health devices. Quality certifications including ISO 13485 have increased by 65% in two years as manufacturers target export markets.
Digitally enabled devices show the strongest growth trajectory, with remote monitoring systems, AI-assisted diagnostics, and connected medical equipment experiencing 27% annual growth. Integration with Indonesia’s health information systems creates particular market opportunities.
Regulatory processes have improved through the digitalization of submission and approval workflows, though harmonization with international standards remains a work in progress.
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Indonesia’s pharmaceutical manufacturing capabilities have expanded significantly, with ProSpace Indonesia’s Healthcare Industry Report indicating that domestic production now meets 78% of national drug requirements, up from 63% in 2023. Investment in pharmaceutical manufacturing reached $1.9 billion in 2024, reflecting growing confidence in the sector.
Active pharmaceutical ingredient (API) production shows the most dramatic improvement, with 47 new APIs manufactured domestically since the government launched its pharmaceutical independence initiative. Meanwhile, vaccine manufacturing capacity has doubled, with Indonesia now producing COVID-19, influenza, and dengue vaccines for domestic use and export.
“The pandemic fundamentally changed Indonesia’s approach to pharmaceutical manufacturing, prioritizing supply security alongside cost considerations,” explains Dr. Rahmat Hidayat, Healthcare Industry Analyst at ProSpace. “The resulting ecosystem is more resilient and increasingly innovation-oriented.”
Research and development investments have increased by 87% since 2023, with 23 Indonesian pharmaceutical companies now conducting clinical trials for novel formulations and biosimilars. University-industry partnerships have strengthened, with five collaborative research centers established.
Export values for pharmaceutical products reached $820 million in 2024, primarily to ASEAN, Africa, and Middle Eastern markets. Meanwhile, the domestic market continues to expand at 7.3% annually as health insurance coverage improves access.
Regulatory reforms have accelerated approval processes for locally manufactured products while maintaining quality standards, reducing time-to-market by an average of 7 months.
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Indonesia’s digital infrastructure development has accelerated significantly, with ProSpace Indonesia’s Connectivity Report showing that high-speed internet access has reached 87% of the population, up from 73% in 2023. The improvement is particularly notable in eastern Indonesia, where coverage has increased by 29 percentage points.
The government’s Palapa Ring project, providing fiber optic backbone connectivity across the archipelago, has been complemented by last-mile solutions including fixed wireless access and low-cost satellite internet services. Mobile network coverage now reaches 98.5% of populated areas, though quality varies significantly.
“Indonesia is successfully addressing both access and affordability barriers that previously limited digital participation,” notes Diana Kusuma, Digital Infrastructure Specialist at ProSpace. “Innovative public-private partnerships and technology-neutral policies have proven particularly effective.”
5G networks now cover 42 cities, primarily in Java, Sumatra, and Bali, with 19.7 million subscribers. Meanwhile, 4G remains the dominant technology nationwide with 215 million connections. Infrastructure sharing regulations have accelerated deployment while reducing costs.
Internet exchange points have expanded from 4 to 12 since 2023, improving domestic traffic management and reducing latency. Meanwhile, data center capacity has grown by 65%, supporting increased local content hosting.
Challenges remain in digital literacy and affordability for the lowest income segments, issues being addressed through targeted subsidy programs and skills development initiatives across educational institutions.
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Indonesia’s major cities are experiencing a fundamental transformation in urban mobility systems, with integrated multi-modal networks replacing fragmented transportation options. ProSpace Indonesia’s Urban Mobility Report indicates that public transport usage has increased by 47% across Indonesia’s five largest cities since 2023.
Jakarta leads the transformation, with its expanded MRT, LRT, BRT, and micromobility options now handling 5.3 million daily trips. Integration through unified payment systems and coordinated schedules has been particularly effective in attracting riders from private vehicles.
“We’re witnessing a mindset shift among urban residents as public transportation increasingly becomes the preferred choice rather than a last resort,” explains Dr. Siti Rahayu, Urban Planning Specialist at ProSpace. “The combination of convenience, affordability, and environmental benefits is driving adoption.”
Electric buses now constitute 42% of Jakarta’s bus fleet, with similar transitions underway in Surabaya, Medan, Makassar, and Bandung. Air quality improvements have been measurable, with PM2.5 levels decreasing by an average of 18% in transit corridors.
Transit-oriented development policies have stimulated approximately $8.2 billion in real estate investments near transportation nodes since 2023. Meanwhile, ride-hailing services have evolved to complement rather than compete with public transportation through first/last-mile connection partnerships.
Challenges remain in financing ongoing operational subsidies and maintaining aging infrastructure while expanding networks, issues being addressed through innovative public-private funding mechanisms.
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Indonesia’s ambitious railway development program is fundamentally altering logistics patterns and creating new economic corridors, according to ProSpace Indonesia’s Transportation Infrastructure Assessment. Rail freight volumes increased by 42% in 2024, with substantial mode shifting from road transportation.
The Trans-Sumatra Railway, now connecting Lampung to Aceh with 1,840 kilometers of operational track, has reduced logistics costs for agricultural and manufacturing products by an average of 28%. Meanwhile, the Trans-Sulawesi and Java-Bali networks continue to expand, with 520 kilometers of new track completed in 2024 alone.
“Rail infrastructure development is creating structural changes in Indonesia’s economic geography,” notes Bambang Widjaja, Transportation Infrastructure Analyst at ProSpace. “We’re seeing industrial investment following rail corridors as companies recognize the logistics advantages.”
The operational Jakarta-Bandung High-Speed Railway has reduced travel time to 40 minutes, creating an expanded economic zone as professionals increasingly commute between the cities. Plans for extending high-speed rail to Surabaya by 2028 advance with land acquisition now 75% complete.
Urban rail networks in Jakarta, Surabaya, and Makassar continue to expand, with daily ridership across all systems reaching 1.7 million passengers. Transit-oriented development around stations is reshaping urban land use patterns and property values.
Public-private partnerships increasingly fund railway development, with the government focusing on track infrastructure while private operators manage rolling stock and operations under performance-based concessions.
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Indonesia’s port infrastructure is undergoing unprecedented modernization, with ProSpace Indonesia’s Maritime Logistics Study revealing that handling capacity has increased by 37% since 2023. Automation technology, deeper drafts, and expanded container facilities have transformed the country’s key ports into competitive regional hubs.
The transformation is most visible at Tanjung Priok, where semi-automated container terminals have reduced vessel turnaround times by 43% while increasing throughput capacity to 12.5 million TEUs annually. Similar modernization efforts at Tanjung Perak, Makassar, and Bitung are creating an integrated national port network.
“Indonesia is moving beyond addressing basic capacity constraints to developing truly world-class maritime infrastructure,” explains Maria Tanuwidjaja, Maritime Logistics Specialist at ProSpace. “The integration of digital platforms across the logistics chain is proving particularly transformative for efficiency.”
Digital port community systems now connect 17 major ports, enabling paperless processing and reducing administrative delays by an average of 68%. Meanwhile, investments in cold chain facilities have opened new opportunities for high-value perishable exports.
The Indonesia Port Corporation reports that foreign vessel calls increased by 23% in 2024, reflecting improved competitiveness, while domestic inter-island shipping costs have decreased by 17% over two years due to efficiency gains.
Challenges remain in developing skilled personnel for advanced operations and ensuring consistent implementation of national standards across regional ports.
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The Indonesian government has released its comprehensive infrastructure development plan for 2025-2030, outlining projects valued at $327 billion across transportation, energy, water resources, and urban development sectors. ProSpace Indonesia’s Infrastructure Investment Report analyzes the ambitious pipeline that aims to accelerate economic growth and reduce regional disparities.
Transportation infrastructure dominates the plan, accounting for 43% of projected investments. This includes 2,840 kilometers of new highways, 3,750 kilometers of railway expansions, 15 new airports, and major port developments across the archipelago. Eastern Indonesia receives particular attention, with 35% of transportation allocations directed to previously underserved regions.
“This pipeline represents Indonesia’s most ambitious and comprehensive infrastructure planning cycle to date,” notes Irawan Soedjono, Infrastructure Policy Expert at ProSpace. “The balance between economic corridors and inclusive development creates a framework that addresses both growth and equity objectives.”
Public-private partnerships are expected to fund approximately 38% of the total investment, with the remainder coming from state budgets, state-owned enterprises, and international development financing. The government has established a dedicated project preparation facility to ensure projects meet bankability requirements.
Climate resilience features prominently in the planning guidelines, with all major projects requiring adaptation and mitigation elements. Meanwhile, local content requirements aim to maximize economic benefits for Indonesian suppliers and contractors.
Implementation challenges include land acquisition processes and coordination between central and regional governments, issues addressed through recent regulatory reforms.
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Indonesia’s oil and gas industry has attracted $15.2 billion in new investment commitments despite global energy transition trends, according to ProSpace Indonesia’s Upstream Energy Report. The investments target both conventional production and emerging opportunities in carbon capture and hydrogen production.
Exploration activities have intensified in eastern Indonesia, with seven significant discoveries announced in the past 18 months. Meanwhile, enhanced oil recovery techniques are extending production at mature fields in Sumatra and Kalimantan, slowing the natural decline rate from 12% to 7% annually.
“Indonesia is successfully balancing energy transition goals with the practical realities of meeting current energy needs,” explains Dr. Adi Prasetyo, Oil and Gas Analyst at ProSpace. “The focus on natural gas as a transition fuel while exploring low-carbon technologies provides a pragmatic pathway.”
Liquefied natural gas (LNG) development continues as a priority, with the Abadi LNG project advancing toward final investment decision and expansion underway at the Tangguh facility. Indonesia’s LNG exports reached 16.2 million tonnes in 2024, generating approximately $8.7 billion in export earnings.
Refining capacity modernization progresses with the Tuban and Bontang refinery projects, aimed at reducing petroleum product imports which currently account for 58% of domestic consumption. The projects incorporate renewable fuel capabilities to support long-term sustainability objectives.
Regulatory reforms including streamlined permitting processes and revised production sharing terms have improved the investment climate, though more progress is needed to achieve production targets.
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