Sign up | Log in



Home  >>   Daily News  >>   Indonesia  >>Investment  >> RI may lose out to India in luring global investors
NEW UPDATES Asean Affairs 17 September 2015  

RI may lose out to India in luring global investors

Indonesia may lose potential investment to India, which has become one of most attractive investment destinations in Asia owing to its relatively stable economic conditions and higher economic growth.

Su Sian Lim, HSBC economist for Southeast Asian region or ASEAN, said in Jakarta on Monday that India was better at fixing its domestic economy than Indonesia.

“In the past, they have often been put in the same basket. Comparisons have been made about growth, about structural reform, whose external vulnerabilities are worse and so on and so forth, but right now it looks to me, from all angles, India is doing better,” she said in a discussion on investment flow trends from ASEAN.

“The story is quite different in Indonesia [from India’s story] with ongoing pressure in commodity prices. It has hit the economy quite hard,” she said.

HSBC predicts that such cyclical slowdown will result in Indonesia’s economy expanding by only 4.7 percent this year, its lowest level in six years. Indonesia’s GDP grew just 5.02 percent last year, down from 5.6 percent in 2013.

“In 2016, it’s not going to be significantly better. We’re expecting Indonesia to expand to 4.9 percent,” she added. HSBC’s forecast is lower than the 5.5 percent growth that the government has planned in the 2016 draft state budget.

On the contrary, HSBC estimates that India’s economic growth will surge to 7.8 percent in 2015, from 7.3 percent last year, and continue to expand to close to 8 percent in 2016.

According Lim, such expansion prospects will potentially attract investments — including foreign direct investment (FDI)—into India from Indonesia and its neighbors in ASEAN.

The Indonesian government hopes the implementation of the ASEAN Single Market later this year makes the country a more attractive foreign investment destination not only to companies within ASEAN but also those from outside the region.

Even though both India’s and Indonesia’s newly elected leaders have vowed to improve the economy through structural reform, Lim argued that Indonesia was still facing numerous issues domestically that could hamper its competitiveness. As previously reported, Indonesia is eyeing a total of Rp 343.7 trillion (US$24 billion) in FDI in 2015 through a series of moves, including simplification of the “one-stop integrated service” at the Investment Coordinating Board (BKPM).

This year’s figure is an increase from Rp 307 trillion booked in 2014 and by June, the amount of FDI had already reached Rp 174.2 trillion, equal to half the target.

Lim said that the Indonesian government’s recently launched economic policy package offered a lot of benefits to foreign investors, but added that “they are going to take some time before investors actually react.”

Meanwhile, BKPM deputy chairman of investment monitoring and controlling Azhar Lubis brushed off the concerns. “We often hold talks with investors from South Korea, Japan and China and they all say that Indonesia remains a prospective investment destination,” he said.

However, he acknowledged that they would like to see what the government could do with its infrastructure plan, including electricity infrastructure, to meet the investors’ business needs.

Separately, Indonesian Institute of Sciences (LIPI) economist Latif Adam said that the government should “pay attention” to economic development in India.

“We have the same characteristics, a large population and big domestic market, but keep in mind that Indonesia has a larger middle-income bracket ratio that the government can benefit from,” he said.

Reach Southeast Asia!
10- Nations, 560- Million Consumers
And $1 -Trillion Market
We are the Voice of Southeast Asia Media Kit
The only Media Dedicated to Southeast Asia Advertising Rates for Magazine
Online Ad Rates

Comment on this Article. Send them to

Letters that do not contain full contact information cannot be published.
Letters become the property of AseanAffairs and may be republished in any format.
They typically run 150 words or less and may be edited
submit your comment in the box below

Today's  Stories                           September 17 , 2015 Subsribe Now !
• ASEAN, Japan hold Television Festival Subcribe: Asean Affairs Global Magazine
• RI may lose out to India in luring global investors
• Prime minister, Lao counterpart increase collaboration on transport
Research Reports
on Thailand 2007-2008

• Textiles and Garments Industry
• Coffee industry
• Leather and footwear industry
• Shrimp industry

• RI records $433.8m trade surplus in August
• Myanmar seeks more foreign investment
Asean Analysis                   September 11, 2015
• Asean Analysis September 11, 2015
Indonesia Faces Resurgent Maritime Piracy Challenges
Advertise Your Brand

Asean Stock Watch  September  15,   2015
• Asean Stock Watch-September 15, 2015
The Biweekly Update
• The Biweekly Update August 21, 2015

ASEAN NEWS UPDATES      Updated: 04 January 2011

 • Women Shariah scholars see gender gap closing
• Bank Indonesia may hold key rate as inflation hits 7 percent
• Bursa Malaysia to revamp business rules
• Private property prices hit new high in Singapore • Bangkok moves on mass transport
• Thai retailers are upbeat
• Rice exports likely to decline • Vietnamese PM projects 10-year socioeconomic plan


This year in Thailand-what next?

AseanAffairs   04 January 2011
By David Swartzentruber      

It is commonplace in journalism to write two types of articles at the transition point between the year that has passed and the New Year. As this writer qualifies as an “old hand” in observing Thailand with a track record dating back 14 years, it is time take a shot at what may unfold in Thailand in 2011.

The first issue that can’t be answered is the health of Thailand’s beloved King Bhumibol, who is now 83 years old. He is the world's longest reigning monarch, but elaborate birthday celebrations in December failed to mask concern over his health. More






1.  Verifier

1. Verifier

For security purposes, we ask that you enter the security code that is shown in the graphic. Please enter the code exactly as it is shown in the graphic.
Your Code
Enter Code

Home | About Us | Contact Us | Special Feature | Features | News | Magazine | Events | TV | Press Release | Advertise With us

| Terms of Use | Site Map | Privacy Policy  | DISCLAIMER |

Version 5.0
Copyright © 2006-2020 TIME INTERNATIONAL MANAGEMENT ENTERPRISES CO., LTD. All rights reserved.
Bangkok, Thailand