Indonesia is making a serious push to become Southeast Asia’s next major AI hub. A new AI Factory planned in Central Java of Indonesia could reach 1 gigawatt (GW) of computing capacity within three years.
The project is being developed by Zankore by Indosat, a collaboration involving Indosat Ooredoo Hutchison, Ooredoo Group, Nokia, and NVIDIA.
The first phase is expected to begin in the first half of 2027 in Batang, Central Java. It will start with around 200 megawatts (MW) of capacity.
The plan doesn’t stop there. The AI factory facility in Indonesia is expected to expand gradually and reach 1 GW within three years.
For the Indonesian government, the project represents more than a large technology investment. It is also seen as a sign that major global technology companies are gaining confidence in Indonesia’s digital economy.
Minister of Communication and Digital Meutya Hafid welcomed the project and its potential impact on the country’s technology ecosystem.
“The government welcomes the commitment of four global technology companies to build an AI Factory in Indonesia. This investment demonstrates growing global confidence in the future of Indonesia’s digital economy while strengthening Indonesia’s position as a destination for high-value technology investment,” Meutya said in Jakarta on Friday, August 7, 2026.
An AI Factory is not simply a larger data center. The infrastructure is designed specifically to support the development and operation of AI services. It combines AI-ready data centers with high-performance GPUs, networking systems, and data storage.
The system will also include GPU-as-a-Service, orchestration, workload management, and end-to-end AI operations.
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With a planned capacity of 1,000 MW, the Indonesian project would rank among the largest AI infrastructure investments announced in Southeast Asia.
Meutya said the project has been in development for years. The government has also supported the plan from its early stages.
“This plan was initiated from the beginning and was presented to President Prabowo Subianto two years ago. Now, the entire process has reached its final stage and can therefore be announced to the public,” she said.
The project will also support the development and hosting of Sahabat-AI. The Indonesian open-source large language model, or LLM, has 70 billion parameters. It is designed to support several languages used in Indonesia.
These include Indonesian, Javanese, Sundanese, Balinese, and Batak.
Zankore will also introduce Token-as-a-Service. The service is intended to make AI computing more accessible and affordable.
Its potential users include the general public, micro, small, and medium-sized enterprises (MSMEs), government ministries and agencies, and application developers.
The broader goal is to make advanced AI computing available beyond large technology companies.
“What is being built is not merely a data center or computing infrastructure. This is the foundation of a complete national AI ecosystem, covering computing capacity, AI services, and the development of Indonesian language models that can be used across various sectors. The presence of this AI Factory will strengthen Indonesia’s position as a regional AI hub because it will be able to serve both national and regional needs,” Meutya said.
The AI push doesn’t end with computing infrastructure. Indonesia is also developing its domestic AI hardware capabilities.
The country’s first GPU manufacturing facility is currently being built in Cikarang. The facility is targeted for inauguration in December. Its role will be to strengthen the supply chain supporting Indonesia’s AI industry.
The government believes this combination of infrastructure and hardware production could give Indonesia a stronger position in the regional AI race.
Meutya pointed to several advantages that Indonesia already has.
The country has experience developing large-scale infrastructure. Its energy resources are also continuing to expand. Then there is the domestic market.
Indonesia has more than 280 million people, creating a large potential user base for digital services and AI applications.
Government policy is another factor. Authorities are continuing to promote digital transformation and the development of digital talent.
For Indonesia, the pieces are increasingly coming together. Large computing infrastructure can provide the capacity needed to run AI systems. A growing energy supply can support those facilities. The domestic market creates demand, while digital talent can help develop new applications and services.
Government policy is intended to connect these elements.
“When infrastructure, the market, talent, and policy move together, Indonesia has a strong foundation to become one of the region’s AI development centers. The government will continue to ensure a conducive investment climate so that AI innovation can grow while delivering tangible benefits to society,” the Minister of Communication and Digital said.
The government has also said it will continue supporting strategic investments that can strengthen Indonesia’s digital competitiveness.
At the same time, AI development will not be focused solely on investment and technological scale.
The government wants AI to be developed and used responsibly. It also aims to make the technology more inclusive and ensure that AI creates tangible added value for the national economy.
If the planned projects move forward as scheduled, Indonesia could enter the next stage of its digital transformation with something it has been working toward for years: a domestic AI ecosystem that can serve both the Indonesian market and the wider Southeast Asian region.
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