Indonesia is undergoing a significant stage in its digital transformation journey, with its digital economy expanding at an impressive pace. Its digital economy is expected to surpass $130 billion by 2025 and could contribute an additional $2.8 trillion by 2040, fuelled by more than 180 million smartphone users and remarkable connectivity statistics. At the beginning of 2025, there were approximately 212 million internet users, representing about 74.6% of the total population. The country also has 356 million cellular mobile connections, representing 125% of its population, with approximately 96.4% of these connections being broadband-enabled. E-commerce is experiencing significant growth, with market volume projected to reach around $94.5 billion by 2025 and anticipated to double by 2030.
As one of Southeast Asia’s fastest-growing digital economies, the archipelago nation has witnessed remarkable technological progress and the widespread adoption of digital tools. However, substantial challenges remain in establishing robust data governance frameworks and fostering online trust among citizens.
Despite the implementation of the Personal Data Protection Law in October 2022, Indonesia continues to face significant challenges in regulatory development. Current efforts to establish a supervisory authority and put regulations in place present opportunities to improve consumer protection in an increasingly complex digital landscape. This phase of regulatory development coincides with the swift evolution of digital risks, including online scams, personal data breaches, and new threats from Generative AI, which raise fresh concerns about user safety. In the absence of a fully developed institutional framework, a clear entity to oversee compliance, investigate potential violations, or comprehensively manage personal data breaches has yet to be established.
The government’s ambitious 2045 Digital Vision seeks to build a strong digital ecosystem. However, achieving this vision requires addressing infrastructure development priorities, ensuring regulatory harmonisation, and continually improving digital literacy across diverse population segments. Indonesia’s digital literacy level is classified as medium, with a digital literacy index of approximately 3.54 out of 5 as of 2022. This indicates considerable potential for growth and capacity building that extends beyond just policy implementation.
In light of these development opportunities, the Tech for Good Institute, in collaboration with the Center for Indonesian Policy Studies (CIPS), hosted a research dialogue on “Indonesia’s Digital Leap: Improving Data Governance and Reinforcing Online Trust” as part of CIPS DigiWeek 2025. The event aimed to explore fit-for-purpose governance approaches that should be adopted to enable responsible digital growth while reinforcing online trust and protecting Indonesia’s digital society.
Speakers:
- Sonny Hendra Sudaryana, Director of Digital Ecosystem Development, Ministry of Communication and Digital Affairs
- Ardhanti Nurwidya, Associate Director of Vriens and Partners and Co-Founder of the Indonesian Data Protection Practitioners Association (APPDI)
- Radhi Juniantino, Director of Trust & Safety at Grab and OVO
- Wahyuni Bahar, Principal at Bahar Law & Consulting
- Hafiz Noer, Head of Research at Center for Digital Society
- Citra Nasruddin, Programme Director, Tech for Good Institute
- Keith Detros, Programme Manager, Tech for Good Institute
Key takeaways:
1. Access and inclusion are key foundational aspects of Indonesia’s data governance goals
Before discussing data governance, the panel reiterated the importance of establishing a robust digital infrastructure in Indonesia. Indonesia’s 2045 Digital Vision is geared towards strengthening digital inclusion through various initiatives. These include important cable projects that link all major islands, extending 4G service to rural communities, and connecting remote islands through fibre optic networks to close the digital divide and guarantee equitable access throughout the nation. This infrastructure-first approach acknowledges that digital trust cannot be established without ensuring equitable access across Indonesia’s diverse geographical terrain. The principle of “No One Left Behind” underpins this strategy, highlighting the necessity of making digital transformation both inclusive and comprehensive to achieve meaningful impact.
The government has translated this vision into tangible investments and initiatives on various fronts. Network expansion efforts have successfully increased internet penetration to 79.5% in 2024, with continued growth in 4G networks and the introduction of 5G technology targeting both urban hubs and underserved rural areas. The government has prioritised physical infrastructure development, focusing on Base Transceiver Stations (BTS) and fibre optic networks as essential measures to close the digital divide.
The ambitious Palapa Ring project exemplifies this commitment by extending fibre optic networks to 514 districts and cities throughout the archipelago. The Indonesian government is leveraging Low Earth Orbit (LEO) satellite technology to enhance connectivity in difficult-to-access regions throughout the expansive archipelago. LEO satellites orbit nearer to Earth compared to traditional geostationary satellites, offering quicker and more dependable internet services, especially beneficial for archipelagic nations where the installation of fibre optic cables or the construction of BTS towers across numerous islands is highly expensive and challenging. The Ministry of Communication and Information (Kominfo) states that LEO satellites have the potential to greatly diminish the digital divide in remote regions within the next ten years, providing optimism for millions who are still without connectivity.
2. Collaboration among multi-stakeholders is crucial for establishing trust and safety online
The panel discussion highlighted that building online trust and safety requires extensive involvement from all sectors of society. Panel speakers emphasised the promising “penta-helix” collaboration model, which brings together government agencies, academic institutions, media organisations, civil society, and industry to tackle complex digital challenges. Kominfo recommended this model in the ASEAN Guideline on the Management of Government Information to Combat Fake News and Disinformation in the Media. This initiative involves a wide range of stakeholders in efforts to expose hoaxes and enhance counter-narratives against disinformation. This co-regulatory approach leverages the strengths of each sector, ensuring a diversity of perspectives in policy development. Industry representatives provided examples of how collaborative frameworks promote knowledge sharing and the establishment of best practices, suggesting that this method offers a sustainable model for addressing emerging challenges in digital governance.
The government has implemented proactive measures to foster collaboration among various stakeholders through specific policy initiatives. In early 2025, the Indonesian government developed a draft regulation focused on child protection in the digital realm, launching a public consultation platform in March 2025 to invite responses from the public. The government partnered with leading digital platforms such as YouTube, TikTok, and Meta to facilitate effective implementation, underscoring its dedication to engaging both the public and industry stakeholders in the development of digital policies that impact vulnerable groups.
The government is developing comprehensive regulations to ensure the responsible use of emerging technologies like Artificial Intelligence (AI). The drafting process aims to include contributions from the public and stakeholders to tackle ethical, privacy, and misuse issues, drawing on previous public feedback from a 2023 circular regarding AI ethics. This illustrates a continuing movement to involve the public in the governance of technology, aiming to harmonise innovation with societal protections. Industry representatives shared instances of how these collaborative frameworks facilitate knowledge sharing and the development of best practices, indicating that this approach presents a sustainable model for tackling emerging challenges in digital governance.
3. Building capacity across diverse population segments is essential for digital resilience
The discussion highlighted that digital literacy is essential for building trust and safety in Indonesia’s digital ecosystem. Panel speakers emphasised that Indonesia’s digital literacy gap is still significant, with various population segments needing customised strategies for capacity building. The challenge spans multiple literacy levels: individuals with low literacy must comprehend basic information principles and privacy capabilities, especially concerning the proper conditions for sharing personal data; those with medium literacy need to understand safe transaction practices and emerging technologies such as AI within sandbox environments; meanwhile, individuals with high literacy require ongoing upskilling to keep pace with AI advancements and global technological changes.
The government has acknowledged this challenge through its digital literacy framework, which is built around four essential pillars: digital ethics, digital skills, digital safety, and digital culture. The Digital Indonesia Roadmap 2021-2024 outlines specific goals for enhancing the digital skills of the workforce, reflecting the nation’s commitment to bridging the literacy gap.
Industry representatives shared instances of how platforms are contributing to digital literacy through targeted engagement. Businesses like Grab organise events for their ecosystems, including drivers and SMEs, to share campaign information and explain features for users. These industry players act as intermediaries for data subjects, helping bridge the literacy gap through practical, hands-on education. The partnership between government-led digital literacy programs and industry-driven capacity-building initiatives signifies a holistic approach to improving digital resilience across Indonesia’s diverse population groups.
4. Building user protection into digital services from the ground up
Building and maintaining trust necessitates a proactive approach grounded in “Trusted by Design” principles that prioritise user protection from the outset. For digital platforms, trust serves as the cornerstone of their operational legitimacy. Experts highlighted that fostering trust entails embedding safety and privacy considerations into product development while ensuring effective coordination among government supervision, industry responsibility, professional expertise, and clear legal frameworks.
This “trust-by-design” approach involves both visible protection features that users can directly interact with and invisible backend systems that proactively monitor, mitigate, identify and respond to risks. The principle that “trust must be earned on a daily basis” underscores the ongoing nature of safety responsibilities. Safety is positioned as a core operational principle rather than an optional element in digital services. Platforms utilise a combination of user-visible security features, such as emergency contacts and AI-powered harmful content detection, and backend monitoring mechanisms to combat fraud, scams, and other threats.
Government policy complements these efforts by developing regulatory frameworks that promote safety, transparency, and accountability while investing in digital literacy initiatives to enhance resilience across diverse user segments. This comprehensive approach recognises that safety is not solely a technological challenge but also requires human capacity building to establish a secure digital ecosystem for all users. The integration of trust and safety principles from the design phase through implementation creates a robust foundation for sustainability and reliability, ensuring users feel protected, confident, and can rely upon.
