No politics, just business, says key official at Indonesia's new wealth fund

He says Danantara's role is to complement rather than compete with the private sector

- Wahyudi Soeriaatmadja

Indonesia's sovereign wealth fund Danantara will focus on investments in the minerals sector, digital infrastructure, renewable energy and healthcare, among others, even as critics questioned its ability to avoid mixing business with political interests.

Launched on Feb 24 by President Prabowo Subianto, Danantara - short for Daya Anagata Nusantara - has faced criticism for appointing Mr Prabowo's political allies, former presidents Joko Widodo and Susilo Bambang Yudhoyono, to its board of advisers.

In an interview with The Straits Times on March 20, Danantara's chief investment officer Pandu Sjahrir talked about the fund's investment strategy and objective. He also dismissed concerns over possible political intervention, while addressing governance and a recent stock market rout.

He said Danantara's role is to complement rather than compete with the private sector. As an investment vehicle and holding company for state-owned enterprises (SOEs), its goal is to strengthen their role in driving the national economy.

"Danantara's strategy is to facilitate economic development by making strategic investments that drive sustainable industrialisation," he added.

Danantara was established three years after the country's first sovereign wealth fund, Indonesia Investment Authority (IIA), was created. IIA focuses on co-investing with foreigners in Indonesia's infrastructure projects such as ports.

Mr Pandu said the timing was right for entering the minerals downstreaming sector, particularly nickel, given the commodity's current price downturn. Digital infrastructure - especially data centres - is also becoming increasingly vital for Indonesia's economic expansion, he noted.

In the past decade, Indonesia saw steady flows of Chinese and South Korean investment into electric vehicle supply chains, where nickel is a key raw material.