Indonesia Construction Industry Report 2026: Output To Expand At An AAGR Of 5.8% Between 2026-2029, Supported By Investments In Housing, Mining, Transport Infrastructure, And Energy Projects

(MENAFN- GlobeNewsWire - Nasdaq) Indonesia's construction market is set to grow, driven by investments in infrastructure, energy projects, and government budget allocations. Opportunities exist in transport, renewable energy, housing, and green infrastructure sectors, promising expansion and employment with targeted development plans and financial support for construction projects.

Dublin, Feb. 05, 2026 (GLOBE NEWSWIRE) -- The "Indonesia Construction Market Size, Trends, and Forecasts by Sector - Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential Market Analysis to 2029 (Q4 2025)" report has been added to ResearchAndMarkets's offering.
Construction industry in Indonesia to expand by 4.1% in real terms in 2025, supported by investments in transport infrastructure and energy projects, coupled with allocations announced as part of the 2026 Budget.

According to the Badan Pusat Statistik (BPS), the average value index of construction completed by construction companies rose by 3.2% year-on-year (YoY) in the first half of 2025, increasing from 164.5 in H1 2024 to 169.8 in H1 2025. In August 2025, the government presented the 2026 draft Budget in the parliament, which includes an expenditure of IDR3.8 quadrillion ($235.9 billion); this is 7.3% higher than the latest spending estimate for 2025. Some of the major allocations announced in the budget include IDR757.8 trillion ($47.2 billion) for the education sector, IDR402.4 trillion ($25.1 billion) for energy security, IDR335.3 trillion ($20.9 billion) for the defence sector, and IDR244 trillion ($15.2 billion) allocated for the healthcare sector.
The Indonesian construction industry is expected to expand at an average annual rate of 5.8% from 2026 to 2029, supported by investments in housing, mining, transport infrastructure, and energy projects. To support the energy sector, in June 2025, the government revealed the 2025-2034 Electricity Supply Business Plan, which plans to add of new power generation capacity by 2034, with 76% coming from renewable sources. Of the total, will be from solar, from hydro, 7.2GW from wind, 5.2GW from geothermal, and the rest from other sources.

To achieve this target, it will require an estimated investment of IDR2.9 quadrillion ($182 billion). In October 2025, the Ministry of Investment and Downstream Industry signed 13 Memorandums of Understanding (MoUs) with the Ministry for Infrastructure and Regional Development, as part of the Indonesia International Sustainability Forum (ISF) 2025, to bolster investment across the country.

The total value of these commitments reached IDR278 trillion ($17.3 billion), covering sectors such as clean energy, marine resources, carbon management, forestry, and green infrastructure. In terms of housing infrastructure, the housing minister announced that the government, through state banks, will disburse IDR130 trillion ($8.1 billion) in construction loans to selected property developers and small businesses, aiming to help them scale up their operations and expand their stores. The loans will support the administration's goal of delivering three million affordable homes annually by 2029 and creating additional employment opportunities.

Report Scope

• Historical (2020-2024) and forecast (2025-2029) valuations of the construction industry in the Indonesia, featuring details of key growth drivers.
• Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
• Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
• Listings of major projects, in addition to details of leading contractors and consultants

Reasons to Buy

• Identify and evaluate market opportunities using our standardized valuation and forecasting methodologies
• Assess market growth potential at a micro-level with over 600 time-series data forecasts
• Understand the latest industry and market trends
• Formulate and validate business strategies using the analyst's critical and actionable insight
• Assess business risks, including cost, regulatory and competitive pressures
• Evaluate competitive risk and success factors

Key Topics Covered:
1 Executive Summary
2 Construction Industry: At-a-Glance
3 Context
3.1 Economic Performance
3.2 Political Environment and Policy
3.3 Demographics
3.4 Risk Profile
4 Construction Outlook
4.1 All Construction

• Outlook
• Latest news and developments
• Construction Projects Momentum Index

4.2 Commercial Construction

• Outlook
• Project analytics
• Latest news and developments

4.3 Industrial Construction

• Outlook
• Project analytics
• Latest news and developments

4.4 Infrastructure Construction

• Outlook
• Project analytics
• Latest news and developments

4.5 Energy and Utilities Construction

• Outlook
• Project analytics
• Latest news and developments

4.6 Institutional Construction

• Outlook
• Project analytics
• Latest news and developments

4.7 Residential Construction

• Outlook
• Project analytics
• Latest news and developments

5 Key Industry Participants
5.1 Contractors
5.2 Consultants
6 Construction Market Data
7 Appendix
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