Budi Karya Sumadi, Minister of Transportation
East Ventures


5 April, 2023


Digitalization helps increase competence and integrity: Budi Karya Sumadi, Minister of Transportation of Indonesia

Indonesia is expected to face global uncertainty due to recession, energy crisis, and geopolitical tensions that will affect various sectors. What strategy has the government prepared to deal with this phenomenon? especially those related to the Transportation sector?

One of the most crucial is air transportation, because it is a capital-intensive sector and is prone to change when there is economic pressure. Therefore, I conveyed to my colleagues at that time, the lesson is that we are a little confused, then we apply a process of restriction, and finally recovery. As a result, economic growth grew 5.3% and Transportation and Warehousing grew 19.9%. This means that our recovery is fast, but still lagging behind. It does take time.

Our strategy is Indonesia-centric, not only on the island of Java. For example, we launched the Trans Sulawesi Railway in South Sulawesi and built an airport in Papua. We also encourage creative financing to finance these infrastructure development projects without depending on the state budget. So when the state budget is affected by a recession, we will prepare creative financing. This is relevant to our strategy for dealing with the recession that digitalization is an easy means for us to reach the public.

What obstacles does the Ministry of Transportation face in its digital transformation efforts in the transportation sector?

The biggest obstacle is human resources. This relates to understanding and awareness that has not been evenly distributed. For example, the process of submitting permits by the private sector. This of course requires an expensive, long, and difficult process. We then make improvements to achieve efficiency. We have launched the Integrated Hubla Electronic System (Sistem Elektronik Hubla Terintegrasi/SEHATI) application. With the digitization of those in the regions there is awareness. Another thing is the integrity that officials in the regions are trying to improve.

Distance is a problem, digital will still help. So digitalization really helps us to be able to compete directly and increase awareness, ability, and integrity. Because nowadays this integrity is often neglected, so we are forced to give appreciation to all colleagues in the ministry.

How is the development of the digitization of the maritime logistics and transportation sector? What are the challenges facing the government?

Human resources and sectoral ego. For example in land transportation. Association groups tug at each other to maintain their respective egos. Regarding Over Dimension Over Load (ODOL) effectiveness is also questioned. So if there are good best practices, it will help us break through the unwillingness of officers to carry out checks through the role of the back office. Because we need firmness in the field so that truck owners comply, then we will secure the taxes and focus on cargo from the port.

But in the last three years we have learned from best practices, what is the most appropriate way to do this, including the matter of sea transportation. I routinely coordinate with the Directorate General of Sea Transportation to address problems in the sector. For example, fish exporting ports, how do we identify them properly, monitor them so that the amount of exports is measured properly. Regarding monitoring of ship movements, we also install CCTV which is digitalized and connected to satellites. This needs best practices.

We think India and China have little in common with us. Especially India, with regards to corruption. So I’m going to India later to see how they control the amount of cargo that comes out. When there is a best practice, we try to apply it in one place and see if it has a good impact. We are also still trying to find the best formula, for example sending Indonesian Army members to the regions. So, leaks do occur in human resources. Therefore, we maintain human resources who understand and have integrity. Sectoral ego also does occur. The sectoral ego is very expensive and is one of the things we feel the most problematic about.

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