Indonesia Construction Market to Expand by 4.1% in 2025

The Indonesian construction industry is expected to experience a significant boost in 2025, driven by investments in transport infrastructure and energy projects, as well as a slowdown in inflation rates and higher budget allocations. According to recent reports, the value-add of the construction industry grew by 3.6% year on year (YoY) in H1 2025, preceded by an annual growth of 7% in 2024. The analyst expects the industry to register an average annual growth of 5.8% from 2026 to 2029, supported by rising investments in housing, mining, and transport infrastructure sectors, along with energy projects.

Key Takeaways:

• The Indonesian construction industry is projected to expand by 4.1% in real terms in 2025, driven by investments in transport infrastructure and energy projects.
• The value-add of the construction industry grew by 3.6% year on year (YoY) in H1 2025, preceded by an annual growth of 7% in 2024.
• The government has announced IDR16.1 trillion ($1 billion) in funds to support the construction of real estate and tourism projects in Bali by 2029.
• The government plans to deploy 20GW of centralized solar projects, 80GW of other solar plants, and 320 gigawatt hours (GWh) of battery energy storage systems across 80,000 villages, with 10,000 villages to be completed in 2025.
• The 2025-2034 Electricity Supply Business Plan aims to add 69.5GW of new power generation capacity, with 76% coming from renewable sources.
• The construction industry is expected to register an average annual growth of 5.8% from 2026 to 2029, driven by rising investments in housing, mining, and transport infrastructure sectors, along with energy projects.
• IDR1.3 quadrillion ($80 billion) seawall project from Banten to East Java will be constructed in phases across 20 years, spanning 700km.
• The analyst expects the construction industry to register a significant increase in investments in housing, mining, and transport infrastructure sectors, driven by the government's plans to add 69.5GW of new power generation capacity by 2034.
• The industry's growth will be supported by investments in energy projects, including the planned 20GW of centralized solar projects, 80GW of other solar plants, and 320 GWh of battery energy storage systems across 80,000 villages.

Statistics:

• The Indonesian construction industry is expected to expand by 4.1% in real terms in 2025.
• The value-add of the construction industry grew by 3.6% year on year (YoY) in H1 2025.
• The government has announced IDR16.1 trillion ($1 billion) in funds to support the construction of real estate and tourism projects in Bali by 2029.
• The government plans to deploy 20GW of centralized solar projects, 80GW of other solar plants, and 320 gigawatt hours (GWh) of battery energy storage systems across 80,000 villages, with 10,000 villages to be completed in 2025.
• The 2025-2034 Electricity Supply Business Plan aims to add 69.5GW of new power generation capacity, with 76% coming from renewable sources.
• IDR1.3 quadrillion ($80 billion) seawall project from Banten to East Java will be constructed in phases across 20 years, spanning 700km.
• The industry is expected to register a significant increase in investments in housing, mining, and transport infrastructure sectors, driven by the government's plans to add 69.5GW of new power generation capacity by 2034.

Sources:

• ResearchAndMarkets.com's offering of the "Indonesia Construction Market Size, Trends, and Forecasts by Sector - Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential Market Analysis to 2029 (Q3 2025)" report
• Badan Pusat Statistik (BPS)
• Central Bank of Indonesia
• Bali government announcement in July 2025
• Government announcement in June 2025 of the IDR1.3 quadrillion ($80 billion) seawall project from Banten to East Java
• ResearchAndMarkets.com website: https://www.researchandmarkets.com/r/vtj7gb
• BusinessWire: https://www.businesswire.com/news/home/20251029098434/en/