Digital Ministry Faces $860M Budget Shortfall
Indonesia’s Ministry of Communication and Digital Application (Komdigi) is grappling with a significant budget gap that may jeopardize key digital initiatives. The proposed budget for 2026 is far from certain.
Funding Request Exceeds Allocation
The ministry requested Rp20.36 trillion (US$1.3 billion) for 2026. However, a joint letter from the Ministry of Finance and the National Development Planning Agency (Bappenas) indicates an allocation of only Rp7.75 trillion. This leaves a shortfall of Rp12.61 trillion (approximately US$860 million).
Priority Programs at Risk
During a hearing with Commission I of the House of Representatives (DPR) on Monday, July 7, 2025, **Komdigi** Secretary-General Ismail outlined how the additional funding would support four crucial programs.
Digital Infrastructure
The largest portion of the requested funds, Rp7.76 trillion, is earmarked for the development and strengthening of digital infrastructure. These funds are intended to support 4G base transceiver stations (BTS) in Papua and other regions. It will also help with internet access operations, maintenance of the Satria-1 satellite, digital infrastructure certification, and terrestrial network expansion to improve equitable access to digital services across Indonesia.
Digital Ecosystem
The ministry seeks Rp3.19 trillion for the development and strengthening of the digital ecosystem and space, but has only received Rp412 billion so far, leaving a Rp2.77 trillion gap. These funds are intended to cover operations and maintenance of the National Data Center (PDN) and its backup facilities (PDNS), digital activity monitoring, illegal content management, supervision of electronic transactions, digital literacy training, scholarships, and national digital human resource development.
Public Communication
A budget of Rp313 billion is needed for public communication campaigns. The funding would support national issues such as rural development, MSME empowerment, energy and food security, nutritious meal programs, investment promotion, and defense sector strengthening. Currently, no indicative budget exists for this program.
Operational Support
The ministry also faces a Rp1.77 trillion shortfall for management and operational support. Of the required Rp3.57 trillion, only Rp1.8 trillion is available. The additional funds would cover routine expenditures like salaries, benefits, and internal monitoring.
Ministry Official Comments
**Ismail** explained that the current indicative ceiling includes Rp2.9 trillion in pure rupiah funds, along with other budget components. He stressed that the budget proposal was created based on consolidated input from all internal units of the ministry.
“We’ve received input from all working units. Komdigi’s total budget need stands at Rp20.361 trillion, which means we need an additional Rp12.615 trillion to fulfill our mission,”
**Ismail** told legislators.
Indonesia’s Digital Economy Growth
Indonesia’s digital economy is projected to reach $130 billion by 2025, highlighting the critical need for investment in digital infrastructure and human capital (McKinsey). Addressing this budget shortfall is crucial for Indonesia to achieve its digital ambitions.
