Singapore’s investment footprint deepens in Indonesia’s digital infrastructure development
Introduction
The launch of a cutting-edge Smart City Command Center at Indonesia’s Deltamas Industrial Estate marks another milestone in the deepening technological partnership between Singapore and Indonesia. This development, unveiled on January 19, 2026, represents far more than a simple technology deployment—it reflects Singapore’s evolving role as a regional smart city knowledge hub and the accelerating digital transformation of Indonesia’s industrial sector.
The Deltamas Development
PT Samakta Mitra, a technology subsidiary of Singapore Exchange-listed Sinar Mas Land, has partnered with NEC Indonesia to establish an advanced command center at the Greenland International Industrial Center in Kota Deltamas. The facility integrates data from CCTV networks, traffic management systems, and environmental sensors to provide comprehensive real-time monitoring across the approximately 2,200-hectare industrial estate.
The command center’s capabilities extend beyond conventional security monitoring. Its AI-powered systems include hazard detection for floods and landslides, proactive traffic management, and data-driven operational analytics designed to enable rapid response to disruptions ranging from traffic congestion to environmental disasters.
Currently hosting over 205 national and international companies across sectors including automotive, food production, and data centers, GIIC has earned international recognition through awards including the PropertyGuru Asia Property Awards and FIABCI World Prix d’Excellence Awards. The estate benefits from strategic access via the Jakarta-Cikampek Toll Road and planned connectivity to Indonesia’s high-speed rail network.
Singapore’s Expanding Influence
Capital Market Connections
The Sinar Mas Land connection illuminates Singapore’s multifaceted relationship with Indonesian development. Listed on the Singapore Exchange since 1997, Sinar Mas Land Limited operates from Singapore headquarters while maintaining extensive operations across Indonesia, China, Malaysia, and Singapore. This dual-listing structure—the company is also traded on the Indonesia Stock Exchange through multiple entities—facilitates capital flows and expertise transfer between the two nations.
Singapore’s investment presence in Indonesia has grown substantially. Data from Indonesia’s investment authority shows Singapore remained the largest foreign investor in the first half of 2025, contributing $8.8 billion in foreign direct investment, representing 32.4 percent of total FDI. This dominance extends beyond pure capital to encompass management expertise, technological solutions, and regional connectivity.
Strategic Economic Partnership
The Indonesia-Singapore bilateral relationship has evolved considerably in recent years. The Bilateral Investment Treaty that came into effect in March 2021 provides legal protections including access to international arbitration, while the updated Double Taxation Avoidance Agreement reduces tax rates on branch profits from 15 to 10 percent and on certain royalties from 15 to 8 percent.
These frameworks have facilitated expanded cooperation across multiple sectors. Recent high-level meetings between Indonesian President Prabowo Subianto and Singapore Prime Minister Lawrence Wong have emphasized priorities including renewable energy, industrial downstreaming, food security, digital technology, semiconductors, and healthcare. Singapore companies have expressed interest in developing solar power plants at Indonesia’s new capital Nusantara, textile manufacturing at Kendal Industrial Park, and data centers in Batam’s Nongsa Digital Park.
The ASEAN Smart Cities Network Dimension
Singapore’s Regional Leadership
The Deltamas command center initiative must be understood within the broader context of the ASEAN Smart Cities Network, launched under Singapore’s chairmanship during the 32nd ASEAN Summit in April 2018. The ASCN represents a deliberate effort by Singapore to position itself as a regional hub for smart city expertise and technology export.
According to research on the network’s formation, ASCN serves as “a soft power extension for Singapore” and reflects the city-state’s ambition to share its urban management successes while creating commercial opportunities for Singaporean technology providers. The network was specifically designed to encourage exportation of Singaporean solutions and digital services to ASEAN partners, with particular emphasis on the industrial sector.
The network now encompasses 37 cities across ASEAN, having expanded from its original 26 pilot cities. Indonesian cities including Jakarta, Makassar, Banyuwangi, and more recently Sumedang, Denpasar, and Semarang participate in the collaborative platform.
Pragmatic Technology Transfer
Indonesia and other ASEAN nations like Thailand and the Philippines share what researchers describe as “a very pragmatic vision” of smart city development, focusing on improving basic urban infrastructure through technology rather than pursuing more sophisticated digital governance models. This pragmatic approach aligns well with Singapore’s export-oriented smart city strategy.
The technology sophistication gap creates both opportunities and challenges. While Singapore possesses advanced capabilities, neighboring countries prioritize different developmental stages. Indonesia, Malaysia, and other Southeast Asian economies have traditionally emphasized brick-and-mortar, labor-intensive manufacturing, creating demand for management and connectivity solutions that Singapore can provide.
Implications for Singapore
Economic Opportunities
The smart city technology sector represents a significant growth opportunity for Singapore firms. With ASEAN’s combined GDP expected to increase substantially over the next decade, and projections suggesting technology and digital agenda implementation could add one trillion dollars by 2030, Singapore-based companies are well-positioned to capture market share.
Singapore’s government IT spending leads ASEAN countries, and this technological advantage translates into exportable expertise. Companies like NEC Indonesia, which maintains operations in Jakarta since 1968, demonstrate how Singapore-headquartered or Singapore-connected firms can leverage regional networks to deliver smart city solutions across Southeast Asia.
Industrial Estate Model Replication
The Deltamas project follows a well-established pattern of Singapore-Indonesia industrial cooperation. Historical precedents include the BatamIndo Industrial Park, developed through Singapore government partnership from 1989, which grew to employ 56,000 workers by 1996. Similar collaborative industrial estates have emerged in Johor, Malaysia, and elsewhere in Indonesia’s Riau islands.
These developments embody what Indonesian officials historically called the “balloon theory”—the concept that Singapore’s limited physical capacity requires safety valves to channel excess growth. Indonesia has long sought to position itself as this outlet, particularly through industrial estates that combine Singaporean management efficiency with Indonesian land, labor, and resources.
Geopolitical Positioning
Singapore’s smart city leadership serves strategic purposes beyond commerce. As a city-state with limited natural resources and physical constraints, Singapore has leveraged technology and connectivity to enhance its regional influence. The smart city expertise enables Singapore to maintain relevance and leadership within ASEAN despite its small size.
This positioning becomes particularly important amid intensifying US-China technological competition. While Chinese companies like Huawei, Tencent, and Alibaba have made inroads into Southeast Asian smart city projects—including Jakarta’s new capital Nusantara and Kuala Lumpur’s “city brain”—Singapore offers an alternative model that balances technological sophistication with Western-compatible standards and governance approaches.
Challenges and Considerations
Implementation Gaps
Research on smart city implementation in Indonesia highlights persistent challenges. Limited high-quality human resources, technology adoption barriers, and infrastructure gaps remain significant obstacles. Studies of Indonesian cities’ smart city readiness reveal that capacity development in technology fields remains crucial for successful implementation.
The environmental dimension also presents concerns. While smart city technology promises efficiency improvements, Indonesia faces severe environmental health challenges and ecosystem vitality risks that technology alone cannot resolve. Critics argue that technological solutions might be outweighed by undesirable socio-ecological consequences without systemic changes.
Digital Divide Concerns
The wealth disparity across ASEAN creates uneven smart city development potential. Singapore and Brunei, with per capita GDPs exceeding $78,000, operate in fundamentally different contexts than Indonesia at $12,404 or Cambodia at $4,010. This “rich get richer” dynamic raises questions about whether smart city technologies will exacerbate regional inequalities or help bridge development gaps.
Dependency Dynamics
Indonesia’s reliance on Singapore for industrial management, technology, and connectivity creates potential dependency issues. While the partnership has driven development, it also reflects Indonesia’s ongoing struggle to build indigenous technological capabilities. The semiconductor sector competition illustrates this tension, with Indonesian officials expressing frustration over perceived regional efforts to limit Jakarta’s technological advancement.
Future Outlook
Cybersecurity Enhancement
NEC Indonesia has signaled plans to enhance the Deltamas command center with robust cybersecurity solutions, recognizing the vulnerabilities inherent in connected industrial systems. This development aligns with broader ASEAN emphasis on cybersecurity capacity building, supported by initiatives like the U.S.-Singapore Third Country Training Program and various regional cybersecurity cooperation frameworks.
Scale and Replication
The success of the Deltamas model could accelerate similar deployments across Indonesia’s industrial estates. With Indonesia rapidly industrializing and establishing special economic zones with tax incentives and infrastructure investment, demand for integrated monitoring and management systems will likely grow. Singapore firms with proven track records in industrial estate management are well-positioned to capture this market.
Regional Integration
The Deltamas development exemplifies how bilateral economic cooperation supports broader ASEAN integration goals. As the region faces an influx of approximately 100 million additional urban residents by 2030, smart sustainable urban infrastructure becomes increasingly critical. Singapore’s role as knowledge broker and technology provider may expand correspondingly.
Conclusion
The Smart City Command Center at Deltamas represents more than a single technology deployment—it embodies the complex, multifaceted relationship between Singapore and Indonesia in the digital age. Singapore’s influence extends through capital markets, technology transfer, industrial partnerships, and regional knowledge networks.
For Singapore, these initiatives offer economic opportunities, regional influence, and strategic positioning amid global technological competition. For Indonesia, they provide access to advanced management systems, operational efficiency, and pathways toward industrial modernization.
The partnership’s long-term success will depend on addressing implementation challenges, building Indonesian technological capacity, and ensuring that smart city benefits extend beyond industrial estates to improve quality of life for broader populations. As ASEAN urbanization accelerates and digital transformation deepens, the Singapore-Indonesia smart city relationship will likely serve as a crucial model—demonstrating both the possibilities and the complexities of regional technological cooperation.
The Deltamas command center, monitoring its 2,200 hectares through integrated sensors and AI-powered analytics, thus becomes a window into Southeast Asia’s digital future—a future where Singapore’s expertise and Indonesia’s scale combine to reshape industrial management and urban development across one of the world’s most dynamic regions.