HSBC Global Research has observed that many large corporations remain reluctant to invest in Indonesia. According to Pranjul Bhandari, Chief Economist for Indonesia and India at HSBC Global Research, large-scale corporate investments could serve as a major driver for Indonesia’s economic growth in the coming years.

Pranjul noted that Indonesia’s economy in the second quarter of 2025 remains on a positive track. However, a significant boost from corporate investments is still needed to accelerate growth further. In her view, current economic growth is not yet sufficient to close the existing output gap.

“How can we achieve higher GDP growth in the coming quarters—or perhaps over the next few years? In my opinion, what is truly needed is an increase in corporate investment,” Pranjul stated during an online Media Briefing on Friday (8/8/2025).

She explained that corporate investments have a multiplier effect, such as expanding production capacity, creating new jobs, and driving higher wages.

However, Pranjul pointed out that the level of corporate investment flowing into Indonesia remains low. At present, many companies prefer to save their funds rather than channel them into expansion or new projects.

“When we look at corporate investment, we find that it’s not particularly high. Companies are choosing to save instead. There’s a lot of money sitting out there, but it’s not being invested. The big question Indonesia faces is: what will make corporations invest?” she said.

Pranjul emphasized that this situation is not unique to Indonesia, but is being experienced by many countries around the world. She also highlighted that Indonesia could capitalize on opportunities amid the ongoing trade tensions caused by import tariffs imposed by U.S. President Donald Trump.

“I think there is a medium-term opportunity, and it comes from the trade side,” Pranjul concluded.