In July 2024, former Indonesian President Joko Widodo declared an ambitious vision: Indonesia must become a global powerhouse in the electric vehicle (EV) supply chain. Speaking at the inauguration of a Hyundai EV and battery plant in Karawang, West Java, he highlighted the country’s determination to build a strong EV ecosystem. With abundant reserves of nickel, copper, and bauxite, Indonesia appears well-positioned to lead the EV revolution. However, beneath Indonesia’s big EV dreams, a different story is unfolding—one of environmental strain, social conflict, and economic challenges.
Powering the EV Ecosystem
Indonesia’s strategy focuses on building an end-to-end EV supply chain. Two mega projects—Dragon and Titan—stand at the center of this transformation. The Dragon project, launched in June 2025 by President Prabowo Subianto, is a $5.9 billion initiative involving state-owned companies Antam and Indonesian Battery Corporation (IBC), alongside China’s battery giant CATL. It aims to integrate nickel mining, processing, battery manufacturing, and recycling, with major facilities in North Maluku and Karawang.
Similarly, the Titan project brings together Antam, IBC, Daaz Bara Lestari, Zhejiang Huayou Cobalt, and EVE Energy. With a planned capacity of 30 gigawatt-hours annually, it further strengthens Indonesia’s push toward becoming a global EV hub.
Environmental Costs and Carbon Concerns
Despite these advancements, beneath Indonesia’s big EV dreams lies a high environmental cost. Nickel processing—critical for EV batteries—often relies on coal-powered plants. This results in high greenhouse gas emissions, raising concerns about whether EVs produced under such conditions can truly be considered “green.” The contradiction between clean mobility and carbon-intensive production is becoming increasingly difficult to ignore.
Social Impact and Community Struggles
The human cost is equally alarming. In regions like North Maluku, mining activities have disrupted local communities. Indigenous groups, such as the Maba Sangaji people, have faced conflicts over land rights, with reports of arrests during protests against mining operations. Beneath Indonesia’s big EV dreams, these tensions reveal gaps in protecting local livelihoods and cultural heritage.
Weak ESG Enforcement
Although Indonesia has regulations for environmental protection and community development, enforcement remains weak. Experts argue that companies often bypass accountability, leading to repeated environmental and social violations. Without stricter governance, these issues risk undermining the long-term sustainability of the EV sector.
Economic Hurdles to Adoption
On the economic front, EV adoption within Indonesia remains slow. Despite incentives like reduced VAT rates—from 11% to 1%—high upfront costs limit accessibility. Only around 17,000 EVs were sold in 2023. Additionally, local content requirements mandate 40% domestic components, sometimes increasing costs and reducing competitiveness.
The Road Ahead
Indonesia’s EV ambitions are undeniably bold, but beneath Indonesia’s big EV dreams lies a complex balance between growth and responsibility. Without stronger environmental safeguards, social protections, and economic reforms, the country risks turning its green vision into a source of local distress. True leadership in the EV space will require not just innovation, but also fairness and sustainability at every level.
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