Danantara, INA to Fund US$800 Million Chandra Asri Petrochemical Plant

• Danantara, INA, and Chandra Asri aim to cut import reliance and support local industry.

• The project could save Rp 4.9T in imports, generate Rp 5T in exports, and boost economic growth.

By Kenzie Aryasatya, Fayza Nawra Avanitanya, Muthia Noor Safitri, Imam Fakhri Prayogo Harianto 

June 20, 2025 at 16:30 GMT+7

Danantara and the Indonesia Investment Authority (INA) made an agreement and have already signed an MoU on Tuesday (6/17), with Chandra Asri to jointly explore the development of a Chlor-Alkali and Ethylene Dichloride (CA-EDC) plant. The development of the building is currently valued at approximately US$800 million.

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This strategic project aims to reduce Indonesia’s dependency on imported caustic soda and EDC. Both of which are critical raw materials in various industrial processes. 

The project and agreement is expected to contribute to the nation’s economic independence and industrial self-sufficiency. This MoU reflects a shared commitment among the involved parties to support sustainable industrial growth and secure key supply chains within the country.

Danantara and the Indonesia Investment Authority (INA) signed a Memorandum of Understanding with PT Chandra Asri Pacific Tbk Ilustration | Source: IDN Financials

The proposed Chlor-Alkali and Ethylene Dichloride (CA-EDC) plant is designated as part of a National Strategic Project, aligning with Indonesia’s broader economic agenda to achieve a national economic growth target of 8%. Through enhanced domestic production of caustic soda and EDC, the facility is expected to reduce imports, resulting in potential savings of up to Rp 4.9 trillion annually.

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In addition, the project holds significant export potential, with the capacity to generate up to Rp 5 trillion in revenue each year.

These economic gains are expected to strengthen Indonesia’s trade balance and contribute directly to national income. The investment also plays a critical role in supporting vital industries, particularly those that rely heavily on chemical inputs for manufacturing and processing.

PT Chandra Asri Petrochemical Tbk Factory Photo | Source: Kumparan (Aditia Noviansyah)

The CA-EDC plant will be developed in two phases, with phase one targeting the production of 400,000 tons of caustic soda and 500,000 tons of ethylene dichloride (EDC) per year. This initial phase is designed to establish a strong foundation for meeting domestic industrial demand while reducing reliance on imports.

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Phase two of the project will focus on expanding production capacity and advancing the development of chlorine-based downstream products, thereby extending the value chain and supporting the diversification of Indonesia’s chemical industry. The project is also committed to enhancing environmental and economic sustainability through modern, efficient production technologies. 

The initiative is expected to elevate Indonesia’s standing in global markets and contribute meaningfully to the country’s overall industrial and economic advancement.

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Source:

Reuters CNBC