Indonesia Charting A Win-Win Way Through US-China AI Rivalry

China's involvement complements – rather than replaces – existing international partnerships. In recent years, Microsoft pledged US$1.7 billion to expand cloud and AI infrastructure, Nvidia committed $200 million to an AI center with Indosat, and South Korea's LG is building a $72 million data center.

By engaging multiple partners - US, Korean and now Chinese - Indonesia is diversifying its AI ecosystem, ensuring access to a wider range of technologies, investment and research capacity while reducing reliance on any single foreign actor.

The rationale behind this approach is pragmatic. Indonesia cannot compete with the US or China in building AI from the ground up. Like nearly every other country, it will rely on foreign AI architectures.

What Indonesia can do is choose partners strategically, ensuring that its workforce, public institutions and startups gain exposure to diverse technologies, applications and operational approaches.

The Tsinghua lab is a strategic addition to this mix - part of a broader effort to balance expertise from multiple sources, not a dramatic pivot toward China.

Talent development is central to the lab's promise. Training Indonesians alongside Tsinghua researchers can help retain expertise at home and strengthen the country's capacity for applied AI.

Even if initial outputs are modest, these experiences can ripple outward, supporting startups, public institutions and regional innovation networks. Over time, the hope is that a generation of researchers and engineers trained in such collaborative environments will form the backbone of Indonesia's AI workforce.

Concerns about Chinese control are often overstated. AI technologies exported abroad do not carry the political filters imposed within China. Indonesians already use platforms like TikTok and Temu without Beijing's oversight.

The real limitations are domestic: patchy internet access outside major cities, limited funding for startups and evolving data protection and cybersecurity regulations. In this context, Chinese participation complements rather than constrains Indonesia's AI ambitions.

China's growing presence also provides a counterbalance in a landscape long dominated by US firms. Washington continues to lead in chips, cloud services and AI platforms, but Beijing offers alternative expertise, research collaboration and training opportunities.

By cultivating multiple partnerships, Jakarta positions itself to benefit from competition, drawing investment, skills and infrastructure from several sources.

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Indonesia's AI strategy is not about choosing sides between superpowers. It's about diversification - ensuring the country remains an active participant in the global AI ecosystem, not just a passive consumer.

The Tsinghua partnership may not dramatically shift the global AI balance, but it strengthens Jakarta's portfolio of options by integrating Chinese knowledge, talent and research into a broader strategy alongside US and Korean partners.

In a world dominated by American and Chinese technology giants, Indonesia cannot set the rules. But by diversifying its AI partnerships, it can chart a path that serves its own national interests, promotes skill development and builds long-term technological resilience.

The Tsinghua lab is a clear sign that Jakarta understands the stakes - and that in the global AI landscape, the smartest strategy may be to multiply partnerships, not pick sides.

Muhammad Zulfikar Rakhmat is director of the China-Indonesia Desk at the Jakarta-based Center of Economic and Law Studies (CELIOS) independent research institute.

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