Indonesia data center market to reach USD 3.63 billion by 2029

The Indonesia data center market is expected to grow at a CAGR of 5.91% from 2023-2029, from USD 2.57 Billion in 2023 to reach USD 3.63 Billion by 2029, according to Research and Markets.

This report analyses the Indonesia data center market share. It elaboratively analyses the existing and upcoming facilities and investments in IT, electrical, mechanical infrastructure, general construction, and tier standards. It discusses market sizing and investment estimation for different segments.

The market has several global support infrastructure providers, which will increase its competitiveness and lead to lower infrastructure prices in the coming years. Some of the support infrastructure vendors in the Indonesia data center market include ABB, Caterpillar, Cummins, Delta Electronics, Eaton, Mitsubishi Electric, and others.

The Indonesia data center market is dominated by several local and global construction contractors, such as Aesler Group International, Arkonin, AWP Architects, Barry-Wehmiller Design Group, Turner & Townsend, DSCO Group, and others. For instance, in March 2024, BW Digital and Citramas announced plans to construct a new data center and subsea cable infrastructure in Indonesia.

The Indonesia data center market is witnessing significant growth in Southeast Asia, driven by digitalization growth, rising connectivity, spill-up of demand from other major markets such as Singapore, and other factors contributing to market growth. Indonesia has positioned itself as a rapidly expanding data center location in Southeast Asia, experiencing significant growth in investments for data centers from local and global operators. For instance, in December 2023, Digital Edge announced that it had acquired the remaining shares of Indonesian digital infrastructure company – Indonet, with the initial acquisition beginning in 2021.

The rising opportunities in the market have attracted several new entrants to the Indonesia data center market, such as Equinix, Digital Edge, Gaw Capital, BDx, and others. Despite a growing Southeast Asian market, Indonesia is growing on the regional cloud computing landscape. This status encourages substantial investments from cloud service providers within the country.

Indonesia has a favorable climate for developing renewable energy sources. By 2060, it aims to be a net-zero carbon emissions country with increasing renewable energy production. For instance, in November 2023, under the Just Energy Transition Partnership (JETP), Indonesia aimed to limit CO2 emissions to 250 million metric tons in its on-grid power sector by 2030. Data center operators in the country are focusing on adopting renewable energy sources. For instance, a prominent data center operator, Telkom Indonesia, has announced the adoption of renewable energy for its data center in Batam.

The digitalization trend significantly propels the growth of the Indonesia data center market, with the Indonesian government actively undertaking initiatives to drive digital transformation. For instance, in December 2023, the Indonesian government announced its plans to introduce a Digital Rupee to boost economic growth. The Digital Rupee, set to be launched under the project code- Project Garuda – will be issued and managed by the country’s central bank, Bank Indonesia. Research and Markets