Indonesia
Photo by Fikri Rasyid, Unsplash
Nature and people clash in SE Asia's regional powerhouse
The world’s most populous Muslim-majority country, Indonesia is a newly-industrialised regional powerhouse and the G20’s only Southeast Asian member. Rapid urbanisation and industrialisation powered by abundant oil, gas, coal and precious metals have driven strong economic development since the 1960s, lifting millions out of poverty.
But this growth has had dramatic environmental consequences too: although Indonesia remains a biodiversity hotspot, the archipelago’s rich ecosystem is severely strained by deforestation, pollution and habitat loss, with many once-abundant species such as the Sumatran tiger, orangutan, rhinoceros and leopard all close to collapse. And with the world’s sixth-highest levels of income inequality, the benefits of Indonesia’s rapid rise are far from equally distributed.
Emerging in 1998 from thirty years of military dictatorship, Indonesia’s political and economic landscape has evolved rapidly over the last two decades. A stable if flawed multi-party democracy has emerged, with serious concerns over accountability and cartelisation, and a booming service industry has eclipsed the once-dominant industrial sector in terms of employment and GDP. Unsurprisingly for a polity which covers over seventeen thousand islands, Indonesia has well-developed marine, maritime and shipping industries; other core sectors include motorcycle manufacture, textiles, and chemicals.
Indonesia’s overall economic direction is set under a series of Medium Term Development Plans (Rencana Pembangunan Jangka Menengah Nasional), the current iteration of which runs from 2020-24 and includes a number of green economy objectives: improving environmental quality, increasing resilience against climate risk and disaster, and – for the first time – low carbon development. A National Plan for Reducing GHG Emissions (Rencana Aksi Nasional Penurunan Emisi Gas Rumah Kaca, RAN-GRK) and a nascent emissions trading scheme round out the policy picture.
Taken together, Indonesia’s environmental objectives show steadily improving ambition over the last decade, but still fall some way short of meeting Paris Agreement targets and are marred by inconsistent implementation.
One area of real strength is Indonesia’s pioneering early adoption of a capitals-based approach to nature conservation and restoration. The System for Integrated Environmental and Economic Accounts (SISNERLING) was first introduced in 1990 and has been refined since, with support from the World Bank’s WAVES initiative. Social capital accounting remains some way off, however.
Finance is another bright spot: Indonesia's Sustainable Finance Roadmap is now in its 2nd phase, adding a green finance taxonomy, development incentives and sustainable finance guidance to existing requirements for financial institutions to report against ESG principles and sustainability metrics to the Financial Services Authority, the OJK.
Given these advances, Indonesia’s response to COVID-19 wasy disappointing. Plunged into a recession in 2020, the government’s response to date has been very far from green: unconditional bailouts to oil, gas, coal and aviation; new limits to public participation in environmental assessments; serious dilution of environmental standards; and rapid deregulation of the mining industry. To date, the country’s business-first approach comes at the cost of social and environmental welfare, undermining Indonesia’s real progress towards an inclusive green economy.
Photo by Fikri Rasyid, Unsplash
Policy Scores
Last updated 18 Dec 2025
Governance
National Green Economy Planning
Indonesia’s medium- and long-term planning embeds “low-carbon development” and climate goals, but there is no single, legally binding, economy-wide “green economy plan.” The Low Carbon Development Initiative (LCDI) has been integrated into the National Medium-Term Development Plan (RPJMN) 2020–2024 and informs the new National Long-Term Development Plan (RPJPN) 2025–2045, which includes green-growth pillars and climate alignment. Indonesia submitted a Long-Term Strategy for Low-Carbon and Climate Resilience (LTS-LCCR) to the UNFCCC (2021) and updated its NDC in 2022; electricity planning has shifted toward higher shares of renewables in PLN’s “Green RUPTL” 2021–2030, and Presidential Regulation 112/2022 sets procurement/tariff rules for renewable power and calls for a coal phase-down roadmap. The Just Energy Transition Partnership (JETP) CIPP (2023) provides an investment/policy framework for the power sector. These instruments together form a de facto planning architecture, but they sit across multiple strategies and regulations rather than a single, binding, comprehensive green-economy plan covering the whole economy with enforceable intermediate targets.
Indonesia’s medium- and long-term planning embeds “low-carbon development” and climate goals, but there is no single, legally binding, economy-wide “green economy plan.” The Low Carbon Development Initiative (LCDI) has been integrated into the National Medium-Term Development Plan (RPJMN) 2020–2024 and informs the new National Long-Term Development Plan (RPJPN) 2025–2045, which includes green-growth pillars and climate alignment. Indonesia submitted a Long-Term Strategy for Low-Carbon and Climate Resilience (LTS-LCCR) to the UNFCCC (2021) and updated its NDC in 2022; electricity planning has shifted toward higher shares of renewables in PLN’s “Green RUPTL” 2021–2030, and Presidential Regulation 112/2022 sets procurement/tariff rules for renewable power and calls for a coal phase-down roadmap. The Just Energy Transition Partnership (JETP) CIPP (2023) provides an investment/policy framework for the power sector. These instruments together form a de facto planning architecture, but they sit across multiple strategies and regulations rather than a single, binding, comprehensive green-economy plan covering the whole economy with enforceable intermediate targets.
Inclusive Corporate Governance
Indonesia provides mechanisms for public consultation—such as the Musrenbang (multi-stakeholder development planning forums) and the national Open Government Action Plan—but there is no statutory requirement for employee representation on company boards. The Financial Services Authority (OJK) requires listed companies to have at least one independent commissioner for governance, but board-level gender quotas are absent. Gender diversity is promoted through voluntary targets (e.g., the Ministry of Women’s Empowerment’s gender-mainstreaming programme), and Indonesia reports SDG progress in its Voluntary National Review, yet corporate ESG/SDG disclosure is only mandatory for financial institutions under OJK Regulation 51/2017.
Indonesia provides mechanisms for public consultation—such as the Musrenbang (multi-stakeholder development planning forums) and the national Open Government Action Plan—but there is no statutory requirement for employee representation on company boards. The Financial Services Authority (OJK) requires listed companies to have at least one independent commissioner for governance, but board-level gender quotas are absent. Gender diversity is promoted through voluntary targets (e.g., the Ministry of Women’s Empowerment’s gender-mainstreaming programme), and Indonesia reports SDG progress in its Voluntary National Review, yet corporate ESG/SDG disclosure is only mandatory for financial institutions under OJK Regulation 51/2017.
Participatory Policymaking
Indonesia mandates public participation and transparency in law- and policy-making, but coverage remains uneven. Law 12/2011 on Lawmaking (as amended by Law 13/2022) requires public input across the stages of planning, drafting, discussion, ratification and promulgation; the Constitutional Court affirmed the participation mechanism in 2023. Access-to-information is guaranteed by Law 14/2008. In development planning, the National Development Planning System (Law 25/2004) institutionalises multi-stakeholder “Musrenbang” consultations at national to village levels. Environmental decision-making requires public participation through the environmental approval regime under Government Regulation 22/2021. However, practice and depth of engagement (including specific assessment of impacts on Indigenous Peoples/local communities, women and persons with disabilities) can vary, and impact-assessment obligations are not uniformly comprehensive across all policy areas.
Indonesia mandates public participation and transparency in law- and policy-making, but coverage remains uneven. Law 12/2011 on Lawmaking (as amended by Law 13/2022) requires public input across the stages of planning, drafting, discussion, ratification and promulgation; the Constitutional Court affirmed the participation mechanism in 2023. Access-to-information is guaranteed by Law 14/2008. In development planning, the National Development Planning System (Law 25/2004) institutionalises multi-stakeholder “Musrenbang” consultations at national to village levels. Environmental decision-making requires public participation through the environmental approval regime under Government Regulation 22/2021. However, practice and depth of engagement (including specific assessment of impacts on Indigenous Peoples/local communities, women and persons with disabilities) can vary, and impact-assessment obligations are not uniformly comprehensive across all policy areas.
Beyond GDP
Indonesia maintains long-running SEEA-based environmental-economic accounts (SISNERLING) compiled by Statistics Indonesia (BPS), covering land cover and asset accounts for timber, energy and minerals, with depletion-adjusted GDP indicators. Government Regulation 46/2017 establishes environmental economic instruments and mandates coordination/data provision for accounts; BPS issued Compilation Guidelines for Natural Capital and Environmental Accounts in 2023. These are used by BAPPENAS to inform planning (e.g., LCDI/RPJMN). However, a fully integrated national “comprehensive wealth” framework covering human, social, natural and produced/financial capital and embedded across budgeting/decision cycles is not yet in force.
Indonesia maintains long-running SEEA-based environmental-economic accounts (SISNERLING) compiled by Statistics Indonesia (BPS), covering land cover and asset accounts for timber, energy and minerals, with depletion-adjusted GDP indicators. Government Regulation 46/2017 establishes environmental economic instruments and mandates coordination/data provision for accounts; BPS issued Compilation Guidelines for Natural Capital and Environmental Accounts in 2023. These are used by BAPPENAS to inform planning (e.g., LCDI/RPJMN). However, a fully integrated national “comprehensive wealth” framework covering human, social, natural and produced/financial capital and embedded across budgeting/decision cycles is not yet in force.
Finance
Green Finance & Banking
Indonesia’s Sustainable Finance Roadmap Phase II (2021–2025) sets clear targets for green finance, introducing a green taxonomy (2022) and incentives for sustainable products. OJK Regulation 51/2017 mandates annual sustainability reports and Sustainable Finance Action Plans for all financial institutions and listed companies. Indonesia has issued sovereign green sukuk and multiple green bonds, and the OJK requires banks to integrate ESG risk in business plans, though climate-specific stress testing is still developing.
Indonesia’s Sustainable Finance Roadmap Phase II (2021–2025) sets clear targets for green finance, introducing a green taxonomy (2022) and incentives for sustainable products. OJK Regulation 51/2017 mandates annual sustainability reports and Sustainable Finance Action Plans for all financial institutions and listed companies. Indonesia has issued sovereign green sukuk and multiple green bonds, and the OJK requires banks to integrate ESG risk in business plans, though climate-specific stress testing is still developing.
Greening Fiscal & Monetary Policy
The 2015 Climate Budget Tagging system continues to track climate-related expenditures within the government budget, informing green finance initiatives.The Sustainable Finance Roadmap Phase II (2021-2025) and the development of the Indonesia Taxonomy for Sustainable Finance Version 2 (2025), now provide a comprehensive classification system for economic activities contributing to sustainable development, guiding green investments across various sectors, including energy, transportation, and agriculture.
Regarding specific fiscal instruments, Indonesia has maintained its position as a leading issuer of Green Sukuk (Islamic bonds), raising billions of dollars over the last years for eligible green projects. In 2023 launched the Indonesia Carbon Exchange (a market for carbon units initially for the power sector) was launched, and the Carbon Tax introduced by Law Number 7 of 2021 is expected to be implemented in 2025, providing a significant fiscal instrument for decarbonization. Besides that, some green regulatory initiatives adopted these years contain various fiscal incentives like tax deductions, VAT exemptions, and import duty relief for renewables.
Bank Indonesia and other financial institutions have commenced climate risk assessments to evaluate the financial system's exposure to climate transition risks.
The 2015 Climate Budget Tagging system continues to track climate-related expenditures within the government budget, informing green finance initiatives.The Sustainable Finance Roadmap Phase II (2021-2025) and the development of the Indonesia Taxonomy for Sustainable Finance Version 2 (2025), now provide a comprehensive classification system for economic activities contributing to sustainable development, guiding green investments across various sectors, including energy, transportation, and agriculture.
Regarding specific fiscal instruments, Indonesia has maintained its position as a leading issuer of Green Sukuk (Islamic bonds), raising billions of dollars over the last years for eligible green projects. In 2023 launched the Indonesia Carbon Exchange (a market for carbon units initially for the power sector) was launched, and the Carbon Tax introduced by Law Number 7 of 2021 is expected to be implemented in 2025, providing a significant fiscal instrument for decarbonization. Besides that, some green regulatory initiatives adopted these years contain various fiscal incentives like tax deductions, VAT exemptions, and import duty relief for renewables.
Bank Indonesia and other financial institutions have commenced climate risk assessments to evaluate the financial system's exposure to climate transition risks.
Green Trade Practices
Indonesia participates in recent trade agreements that include sustainability language, such as the EFTA–Indonesia CEPA and the Regional Comprehensive Economic Partnership (RCEP). However, these provisions are cooperation-oriented and not structured as binding market-access mechanisms for environmental goods and services (EGS). They also do not establish interoperability of green taxonomies or carbon pricing systems. The EU–Indonesia CEPA remains under negotiation, with sustainability objectives noted by the European Commission, but no signed text is in force. Domestically, Indonesia is developing its carbon-pricing architecture through Presidential Regulation 98/2021 (Carbon Economic Value), the OJK-supervised carbon exchange (POJK 14/2023), and a carbon tax framework under Law 7/2021. There is no evidence of CBDR-linked market-access exemptions or international linkage of Indonesia’s carbon instruments in trade agreements.
Indonesia participates in recent trade agreements that include sustainability language, such as the EFTA–Indonesia CEPA and the Regional Comprehensive Economic Partnership (RCEP). However, these provisions are cooperation-oriented and not structured as binding market-access mechanisms for environmental goods and services (EGS). They also do not establish interoperability of green taxonomies or carbon pricing systems. The EU–Indonesia CEPA remains under negotiation, with sustainability objectives noted by the European Commission, but no signed text is in force. Domestically, Indonesia is developing its carbon-pricing architecture through Presidential Regulation 98/2021 (Carbon Economic Value), the OJK-supervised carbon exchange (POJK 14/2023), and a carbon tax framework under Law 7/2021. There is no evidence of CBDR-linked market-access exemptions or international linkage of Indonesia’s carbon instruments in trade agreements.
Pricing Carbon
Indonesia launched a voluntary emissions trading pilot for the power sector in 2023 and, under Law No. 7/2021 on Harmonization of Tax Regulations, introduced a national carbon tax framework with a soft start at IDR 30/kg CO₂e for coal power plants. The government plans a mandatory ETS for power and industry by 2025, to be overseen by a new public service agency. Carbon budgets are not legally established, though the updated NDC targets a 31.9% unconditional reduction by 2030.
Indonesia launched a voluntary emissions trading pilot for the power sector in 2023 and, under Law No. 7/2021 on Harmonization of Tax Regulations, introduced a national carbon tax framework with a soft start at IDR 30/kg CO₂e for coal power plants. The government plans a mandatory ETS for power and industry by 2025, to be overseen by a new public service agency. Carbon budgets are not legally established, though the updated NDC targets a 31.9% unconditional reduction by 2030.
Sectors
Cross-Sectoral Planning
There is explicit integration of green economy priorities across five clusters—energy, manufacturing, infrastructure, agriculture/forests, and emerging natural capital sectors- in the National Long-Term Development Plan for 2025-2045 and the National Medium-Term Development Plan for 2025-2029.
The Low Carbon Development Initiative, coordinated by the Ministry of National Development Planning (BAPPENAS), continues to integrate climate action into planning for sectors like energy, waste, agriculture, and green industry. An Energy Transition and Green Economy Task Force has been established in 2025, a multi-ministerial body designed to lead and harmonize cross-sectoral green policy efforts. Additionally, detailed sectoral roadmaps, such as the Indonesia Net Zero Emission Roadmap for the energy sector or the new Blue Economy Roadmap (2023–2045) are driving implementation in key areas.
To track progress, BAPPENAS launched the Green Economy Index in 2022, using 15 indicators across environmental, social, and economic pillars to monitor the nation's green economy performance.
Ambition and integration still vary across sectors, but there's progress towards a more integrated green sectoral policy approach.
There is explicit integration of green economy priorities across five clusters—energy, manufacturing, infrastructure, agriculture/forests, and emerging natural capital sectors- in the National Long-Term Development Plan for 2025-2045 and the National Medium-Term Development Plan for 2025-2029.
The Low Carbon Development Initiative, coordinated by the Ministry of National Development Planning (BAPPENAS), continues to integrate climate action into planning for sectors like energy, waste, agriculture, and green industry. An Energy Transition and Green Economy Task Force has been established in 2025, a multi-ministerial body designed to lead and harmonize cross-sectoral green policy efforts. Additionally, detailed sectoral roadmaps, such as the Indonesia Net Zero Emission Roadmap for the energy sector or the new Blue Economy Roadmap (2023–2045) are driving implementation in key areas.
To track progress, BAPPENAS launched the Green Economy Index in 2022, using 15 indicators across environmental, social, and economic pillars to monitor the nation's green economy performance.
Ambition and integration still vary across sectors, but there's progress towards a more integrated green sectoral policy approach.
Circular Economy
Indonesia has launched an official Circular Economy Roadmap and National Action Plan 2025–2045, led by Bappenas and confirmed in the 2025 Voluntary National Review (VNR). This roadmap serves as a reference for sustainable consumption and production (SCP) and the circular transition. It is complemented by Extended Producer Responsibility (EPR) policies under MoEF Regulation P.75/2019, which mandates packaging and product waste reduction from 2020 to 2029. Public procurement is also being aligned with circularity goals through Presidential Regulation 16/2018 (amended in 2025) and LKPP Decree 157/2024, which issues Sustainable Procurement Guidelines. However, no economy-wide Circular Material Use Rate (CMUR) target has been adopted.
Indonesia has launched an official Circular Economy Roadmap and National Action Plan 2025–2045, led by Bappenas and confirmed in the 2025 Voluntary National Review (VNR). This roadmap serves as a reference for sustainable consumption and production (SCP) and the circular transition. It is complemented by Extended Producer Responsibility (EPR) policies under MoEF Regulation P.75/2019, which mandates packaging and product waste reduction from 2020 to 2029. Public procurement is also being aligned with circularity goals through Presidential Regulation 16/2018 (amended in 2025) and LKPP Decree 157/2024, which issues Sustainable Procurement Guidelines. However, no economy-wide Circular Material Use Rate (CMUR) target has been adopted.
Green Transport & Mobility
Indonesia’s electric mobility policy is anchored in Presidential Regulation 55/2019, revised by Presidential Regulation 79/2023, which strengthens the framework for accelerating battery-electric vehicle (BEV) adoption and charging infrastructure. The National General Energy Plan (RUEN, Perpres 22/2017) sets broad electrification objectives for the transport sector, supported by ministerial regulations and subnational programmes. The Ministry of Transportation has announced policy targets to electrify 90% of urban mass public transport by 2030, 100% by 2040, and all public transport (including microbuses) by 2045, alongside deployment goals of 13 million electric motorcycles and 2 million electric cars by 2030. These remain policy targets and are not yet embedded in binding regulations. Fiscal incentives are in place, including VAT reductions (from 11% to 1% for locally assembled EVs) and import duty exemptions, to stimulate uptake. As of mid-2024, EV penetration reached only 2.9% of the national automotive market, underscoring the gap between targets and implementation. City-level programmes, such as Jakarta’s TransJakarta plan for a fully electric bus fleet by 2030, are advancing, but there is still no comprehensive national framework for freight electrification.
Indonesia’s electric mobility policy is anchored in Presidential Regulation 55/2019, revised by Presidential Regulation 79/2023, which strengthens the framework for accelerating battery-electric vehicle (BEV) adoption and charging infrastructure. The National General Energy Plan (RUEN, Perpres 22/2017) sets broad electrification objectives for the transport sector, supported by ministerial regulations and subnational programmes. The Ministry of Transportation has announced policy targets to electrify 90% of urban mass public transport by 2030, 100% by 2040, and all public transport (including microbuses) by 2045, alongside deployment goals of 13 million electric motorcycles and 2 million electric cars by 2030. These remain policy targets and are not yet embedded in binding regulations. Fiscal incentives are in place, including VAT reductions (from 11% to 1% for locally assembled EVs) and import duty exemptions, to stimulate uptake. As of mid-2024, EV penetration reached only 2.9% of the national automotive market, underscoring the gap between targets and implementation. City-level programmes, such as Jakarta’s TransJakarta plan for a fully electric bus fleet by 2030, are advancing, but there is still no comprehensive national framework for freight electrification.
Clean Energy
The Presidential Regulation No. 112 of 2022 (2022), accelerates renewable energy development by streamlining electricity procurement, introducing new competitive electricity pricing models, and providing for government incentives. Complementing this, the Ministry of Energy and Mineral Resources Regulation No. 5/2025, issued in 2025, modernizes Power Purchase Agreements for RE projects. Presidential Regulation No. 112 of 2022 also includes a ban on new coal-fired power plants, with certain exceptions.
While the near-term 2025 RE target is projected to be reduced (from 23% to 17-19%), Indonesia has established more ambitious long-term plans. The National Electricity Plan 2024-2060 aims to deploy 75 GW of renewable energy by 2040 and achieve net-zero emissions in the power sector by 2060.
Despite these advancements, challenges persist. Renewable energy deployment continues to lag behind targets (only 1.6 GW of the planned 10 GW RE for 2025), and there is too much reliance on subsidies for fossil fuels.
The Presidential Regulation No. 112 of 2022 (2022), accelerates renewable energy development by streamlining electricity procurement, introducing new competitive electricity pricing models, and providing for government incentives. Complementing this, the Ministry of Energy and Mineral Resources Regulation No. 5/2025, issued in 2025, modernizes Power Purchase Agreements for RE projects. Presidential Regulation No. 112 of 2022 also includes a ban on new coal-fired power plants, with certain exceptions.
While the near-term 2025 RE target is projected to be reduced (from 23% to 17-19%), Indonesia has established more ambitious long-term plans. The National Electricity Plan 2024-2060 aims to deploy 75 GW of renewable energy by 2040 and achieve net-zero emissions in the power sector by 2060.
Despite these advancements, challenges persist. Renewable energy deployment continues to lag behind targets (only 1.6 GW of the planned 10 GW RE for 2025), and there is too much reliance on subsidies for fossil fuels.
Just Transition
Green Job Creation
Indonesia has expanded green job opportunities, especially through the Just Energy Transition Partnership (2022) and new government initiatives. The Ministry of Manpower’s Green Jobs Framework (2023) identified renewable energy, waste management, and eco-tourism as priority sectors, but national strategies for reskilling and just transition remain limited. Most green jobs are still in waste, forestry, and small-scale renewables, with no comprehensive green jobs roadmap in place.
Indonesia has expanded green job opportunities, especially through the Just Energy Transition Partnership (2022) and new government initiatives. The Ministry of Manpower’s Green Jobs Framework (2023) identified renewable energy, waste management, and eco-tourism as priority sectors, but national strategies for reskilling and just transition remain limited. Most green jobs are still in waste, forestry, and small-scale renewables, with no comprehensive green jobs roadmap in place.
Just Transition Frameworks
Indonesia has begun to frame transition policies with social dimensions, but a unified national “just transition” framework is still emergent. The JETP CIPP (2023) outlines policy/investment needs to accelerate a power-sector transition (including coal retirement planning and workforce elements). Presidential Regulation 112/2022 tasks the energy ministry with a coal-phase-down roadmap; PLN’s RUPTL shifts the generation pipeline toward renewables. These provide sectoral scaffolding, but there is limited cross-sector, national-level guidance on benefit-sharing, worker/community protections, and pro-poor implementation across affected sectors beyond electricity.
Indonesia has begun to frame transition policies with social dimensions, but a unified national “just transition” framework is still emergent. The JETP CIPP (2023) outlines policy/investment needs to accelerate a power-sector transition (including coal retirement planning and workforce elements). Presidential Regulation 112/2022 tasks the energy ministry with a coal-phase-down roadmap; PLN’s RUPTL shifts the generation pipeline toward renewables. These provide sectoral scaffolding, but there is limited cross-sector, national-level guidance on benefit-sharing, worker/community protections, and pro-poor implementation across affected sectors beyond electricity.
Greening MSMEs & Social Enterprise
Indonesia lacks a dedicated legal form for social enterprises. MSME greening support includes the Low-Carbon Development Initiative (LCDI) and financing tools such as the Green MSME Financing Scheme under the Ministry of Cooperatives and SMEs and the Centre for Forest Development Financing, which provides soft loans for small forestry enterprises. Bappenas is piloting a Green Industry MSME programme for capacity-building and green-loan support, but coverage and scale remain limited.
Indonesia lacks a dedicated legal form for social enterprises. MSME greening support includes the Low-Carbon Development Initiative (LCDI) and financing tools such as the Green MSME Financing Scheme under the Ministry of Cooperatives and SMEs and the Centre for Forest Development Financing, which provides soft loans for small forestry enterprises. Bappenas is piloting a Green Industry MSME programme for capacity-building and green-loan support, but coverage and scale remain limited.
Inclusive Social Protection
Traditional welfare schemes continue, with early steps toward climate-responsive pilots. The government has piloted green-linked social protection under the Green Recovery Roadmap (2021–2024), targeting sectors like waste, energy, and plantations—an effort projected to sustain 300,000 jobs and avoid 400 Mt CO₂. Complementing this, Indonesia has participated in global initiatives such as the Joint SDG Fund (2020–2022), which supported adaptive social protection systems incorporating climate-risk targeting and cash-based responses for disaster-prone communities. In 2023, adaptive social protection pilots were initiated through the Ministry of Social Affairs and National Disaster Agency, aiming to improve the country’s capacity to respond quickly to climate shocks. However, these efforts remain fragmented and largely donor-driven, lacking a unified national strategy.
Traditional welfare schemes continue, with early steps toward climate-responsive pilots. The government has piloted green-linked social protection under the Green Recovery Roadmap (2021–2024), targeting sectors like waste, energy, and plantations—an effort projected to sustain 300,000 jobs and avoid 400 Mt CO₂. Complementing this, Indonesia has participated in global initiatives such as the Joint SDG Fund (2020–2022), which supported adaptive social protection systems incorporating climate-risk targeting and cash-based responses for disaster-prone communities. In 2023, adaptive social protection pilots were initiated through the Ministry of Social Affairs and National Disaster Agency, aiming to improve the country’s capacity to respond quickly to climate shocks. However, these efforts remain fragmented and largely donor-driven, lacking a unified national strategy.
Nature
Ocean & Land Conservation
Indonesia maintains extensive terrestrial and marine conservation measures. A permanent moratorium on new permits in primary forests and peatlands was established in 2019. Marine protected areas total ~29.9 million ha (≈9.2% of seas) as of 2024, with ongoing additions; the government has articulated a 30% marine protection goal by 2045. Indonesia has updated its National Biodiversity Strategy & Action Plan—IBSAP 2025–2045—aligned with the Kunming-Montreal GBF and the RPJPN. Implementation and monitoring continue through national strategies (e.g., FOLU Net Sink 2030) and marine/forestry regulations, though the regularity and public accessibility of quantified interim progress assessments varies by instrument.
Indonesia maintains extensive terrestrial and marine conservation measures. A permanent moratorium on new permits in primary forests and peatlands was established in 2019. Marine protected areas total ~29.9 million ha (≈9.2% of seas) as of 2024, with ongoing additions; the government has articulated a 30% marine protection goal by 2045. Indonesia has updated its National Biodiversity Strategy & Action Plan—IBSAP 2025–2045—aligned with the Kunming-Montreal GBF and the RPJPN. Implementation and monitoring continue through national strategies (e.g., FOLU Net Sink 2030) and marine/forestry regulations, though the regularity and public accessibility of quantified interim progress assessments varies by instrument.
Natural Capital Accounting
Indonesia’s SISNERLING (System of Integrated Environmental and Economic Accounts) continues to expand, producing asset accounts for timber, minerals, land and water and contributing to SEEA-aligned national statistics. A Natural Resources Fiscal Potential Report is scheduled for completion in 2025, and a multi-agency National Steering and Technical Committee provides governance and expert input.
Indonesia’s SISNERLING (System of Integrated Environmental and Economic Accounts) continues to expand, producing asset accounts for timber, minerals, land and water and contributing to SEEA-aligned national statistics. A Natural Resources Fiscal Potential Report is scheduled for completion in 2025, and a multi-agency National Steering and Technical Committee provides governance and expert input.
Sustainable Agriculture & Food Systems
Indonesia submitted a Strategic National Pathway for Food Systems Transformation to the UN Food Systems Summit in 2021. In 2025, Bappenas advanced implementation through the Convergence Initiative and a related Action Blueprint to localise food systems transformation. These frameworks promote healthy diets, food loss and waste reduction, and sustainable production. Bappenas has also published national studies on food loss and waste and continues to integrate SDG monitoring into national planning. However, there is no consolidated, SDG-aligned national food systems strategy with quantified ecological footprint targets or time-bound harmful subsidy phase-outs.
Indonesia submitted a Strategic National Pathway for Food Systems Transformation to the UN Food Systems Summit in 2021. In 2025, Bappenas advanced implementation through the Convergence Initiative and a related Action Blueprint to localise food systems transformation. These frameworks promote healthy diets, food loss and waste reduction, and sustainable production. Bappenas has also published national studies on food loss and waste and continues to integrate SDG monitoring into national planning. However, there is no consolidated, SDG-aligned national food systems strategy with quantified ecological footprint targets or time-bound harmful subsidy phase-outs.
Nature Finance
Indonesia has established multiple nature-finance and carbon-pricing foundations but retains sizable fossil-fuel supports. Presidential Regulation 98/2021 created the legal framework for a domestic carbon-pricing system (including ETS pilots and a carbon exchange), while OJK’s Sustainable Finance Roadmap Phase II (2021–2025) drives taxonomy/reporting and climate-risk integration. The Indonesia Environment Fund (BPDLH), set by Presidential Regulation 77/2018 and finance ministry regulations, functions as a public service agency to mobilise and channel funds for conservation and restoration. Government Regulation 46/2017 provides for environmental economic instruments (incentives/guarantees). At the same time, administered prices and subsidies in energy (e.g., coal DMO arrangements/pricing for power and various fuels/electricity supports) persist.
Indonesia has established multiple nature-finance and carbon-pricing foundations but retains sizable fossil-fuel supports. Presidential Regulation 98/2021 created the legal framework for a domestic carbon-pricing system (including ETS pilots and a carbon exchange), while OJK’s Sustainable Finance Roadmap Phase II (2021–2025) drives taxonomy/reporting and climate-risk integration. The Indonesia Environment Fund (BPDLH), set by Presidential Regulation 77/2018 and finance ministry regulations, functions as a public service agency to mobilise and channel funds for conservation and restoration. Government Regulation 46/2017 provides for environmental economic instruments (incentives/guarantees). At the same time, administered prices and subsidies in energy (e.g., coal DMO arrangements/pricing for power and various fuels/electricity supports) persist.
Green Recovery
Green Recovery Measures
Indonesia’s COVID-19 National Economic Recovery (PEN) programme (2020 onward) focused on liquidity, tax relief, credit guarantees, and support to firms/households, with limited green conditionality. Government Regulation 23/2020 operationalised PEN; IMF and finance-ministry documentation describe its macro-stabilisation role. Selected measures for clean transport/RE were present, but significant support flowed to energy SOEs and sectors without explicit green conditions; subsequent regulatory changes under the Job Creation (Omnibus) Law and its implementing regulations restructured environmental approvals (GR 22/2021), drawing scrutiny regarding participation/assessment standards. Overall, green-conditional stimulus represented a small share of total support.
Indonesia’s COVID-19 National Economic Recovery (PEN) programme (2020 onward) focused on liquidity, tax relief, credit guarantees, and support to firms/households, with limited green conditionality. Government Regulation 23/2020 operationalised PEN; IMF and finance-ministry documentation describe its macro-stabilisation role. Selected measures for clean transport/RE were present, but significant support flowed to energy SOEs and sectors without explicit green conditions; subsequent regulatory changes under the Job Creation (Omnibus) Law and its implementing regulations restructured environmental approvals (GR 22/2021), drawing scrutiny regarding participation/assessment standards. Overall, green-conditional stimulus represented a small share of total support.