Just a 40 – 90-minute ferry ride from Singapore, Indonesia’s Batam-Bintan-Karimun region is a Free Trade Zone (FTZ), and home to five Special Economic Zones (SEZ) that offer tax concessions, expedited permits and licensing, and dedicated infrastructure for foreign investors. Companies with operations there span those in manufacturing, logistics, IT and data centres.

Singapore and Indonesia share a longstanding partnership to enhance business connectivity between Singapore and BBK. Together with the Johor-Singapore Special Economic Zone (JS-SEZ), this strengthens the vision of the Singapore-Johor-Riau Islands (SIJORI) growth triangle – companies can tap on the complementary strengths of these three regions to access new opportunities for growth in Southeast Asia.

EDB, together with Indonesia’s Coordinating Ministry for Economic Affairs (CMEA), and the Embassy of the Republic of Indonesia in Singapore (KBRI), jointly organised the "Islands of Growth” BBK Business Forum on 18 November 2025, where Indonesian government representatives and industry partners updated business leaders and investors about BBK’s investment environment, business regulations, and incentive structures.

The discussions focused on the progress of the Singapore-Indonesia collaboration, highlighted BBK’s role as a complementary hinterland to Singapore, and showcased new opportunities in manufacturing, digital economy, and green economy sectors.

Here are five takeaways that capture the momentum and direction of BBK’s development.
 

1. Strong Government-to-Government Commitment and Regulatory Improvements

Singapore and Indonesia reaffirmed their close partnership in shaping BBK’s investment climate at the forum, with an eye on deepening their partnership especially in sectors like manufacturing and the digital economy.

“We believe [BBK] is where global companies can build a diversified and resilient manufacturing base, while tapping into the region’s strong growth opportunities,” said Mr Png Cheong Boon, Chairman of the Singapore Economic Development Board (EDB).

He noted that Singapore had long been among the largest foreign investors in the Riau Islands Province, that the BBK region is part of, and had been Batam’s top foreign investor since 2023. In the first half of 2025, investments from Singapore accounted for IDR 7.9 trillion (S$617.3 million), or 69 per cent of Batam’s total foreign direct investment (FDI).
 

Indonesian Coordinating Minister for Economic Affairs Airlangga Hartarto said Singapore’s FDI to Indonesia was more than US$20 billion in 2024, while bilateral trade between the two countries hit US$57.6 billion. Indonesia is Southeast Asia’s largest economy, Singapore has been Indonesia’s top source of FDI for the past decade.

BBK’s economy grew by 7.48 per cent in the third quarter of 2025 as compared to 2024, recording the third-highest growth among all of Indonesia’s 38 provinces. To boost mobility with the region, Indonesia has rolled out visa-free entry into BBK for 13 nationalities, including all ASEAN nationalities, and Singapore Permanent Residents visiting the BBK region. Indonesia has also issued a new regulation to streamline the licensing process to make it easier for companies to invest.

With strong investment interest and upcoming projects by Singapore-based data centre players in Batam, officials from Indonesia’s Ministry for Digital Affairs provided an update on Indonesia’s Landmark Personal Data Protection (PDP) Law No. 27/2022 and how it established a comprehensive framework for data protection and cross-border data flows.

As Indonesia’s Ambassador to Singapore Suryo Pratomo stressed, Indonesia remained committed to creating “a predictable and secure ecosystem” for investors. The PDP Law would ensure BBK’s growth in digital and data-driven sectors is underpinned by robust privacy protection.
 

2. Getting the Best of Both Worlds

The Singapore-BBK partnership offers companies the chance to twin their operations while enjoying the best of what each region offers – tapping on Singapore’s connectivity, talent pool, and strong IP laws to anchor headquarters and R&D functions in Singapore, while siting larger-scale manufacturing and digital operations in BBK to tap on its cost-efficient land, labour, and utilities.

This “twinning” strategy helps companies enhance resilience and agility, as they expand their footprints and strengthen supply chains in Southeast Asia, while developing new market opportunities in the region.

MNCs such as French electrical and electronics manufacturer Schneider Electric, and Swiss-American eye care products manufacturer Alcon have established such “twinned” operations between Singapore and BBK for over two decades.

PC Partner Technology, a recent entrant into BBK, has invested more than US$10 million to build a graphics card manufacturing facility in Batam, demonstrating continued confidence in the model.

3. Momentum from New Industrial Parks in BBK

BBK is home to over 20 industrial parks that continue to expand and upgrade to attract foreign investments. Sembcorp Industries and Panbil Group are jointly developing two major low-carbon industrial parks in Batam, in Tembesi and Tanjung Sauh.

Tembesi Innovation District (TID), which spans 100 hectares, is designed with a robust utilities backbone featuring a dedicated power plant, advanced water treatment, and wastewater recycling to support high-value manufacturing and data centres. TID is also linked to a solar farm capable of generating up to 200 megawatts of clean energy.

“Our buildings are designed to be energy efficient and feature solar ready rooftops. With flexibility being at the heart of our business, we are capable of supporting our customers to achieve green building certifications,” said Mr Eugene Heng, Sembcorp’s Assistant Vice-President, and President Director of TID.

Mr Heng said Batam already has a “thriving ecosystem” where global MNCs like Philips, Infineon, Schneider Electric, and Shimano already have a long-standing presence.

So far, the emerging sectors that are gaining traction at Tembesi are clean energy, recycling, and data centre operators.

The other new industrial park will be located within the 840-hectare Tanjung Sauh SEZ. Ms Sherly Tano, Chief Technical Officer of Panbil Group, described the industrial park as “self-integrated” and “self-sufficient”.  It comprises three hubs – industrial, energy, and logistics. The park has sufficient power to support energy-intensive sectors and logistics infrastructure such as cargo handling and container facilities, offering companies a “one-stop service to ensure uninterrupted business operations”.
 

4. Digital Innovation at Nongsa Digital Park

Growing the digital economy is another central theme for Batam, as laid out by Mr Mike Wiluan, CEO of Nongsa Digital Park (NDP).

He recalled how the park, designed to foster innovation, talent development and cross-border collaboration, was positioned in 2018 as the “Digital Bridge” connecting Singapore and Indonesia’s digital economies.

Since 2018, NDP has attracted more than 80 startups and forged partnerships with Apple, IBM, RMIT, and Epic Games’ Unreal Engine to develop tech training programmes, to build up a pool of tech talent in Batam in areas like cybersecurity and data analytics.

The park’s creative media cluster, Infinite Studios, produces content for Disney, HBO, Netflix, and Nickelodeon, and has won international recognition over the years.

Today, NDP hosts a growing digital community, supported by data centres, creative industries, and education clusters.

5. Green Energy and Data Centre Developments

BBK is also positioning itself as a location where sustainability and the digital infrastructure can go hand in hand. The region is positioning itself to grow clean energy solutions, while simultaneously growing the region’s data centre clusters.

On the energy front, BP Batam has announced planned floating solar projects at the Tembesi and Duriangkang reservoirs to strengthen clean energy supply for both commercial and industrial use, while reducing carbon emissions.

Meanwhile, Mr Png noted that the two new low-carbon industrial parks in Tembesi and Tanjung Sauh will provide advanced manufacturing firms and data centres with renewable energy and sustainable solutions.

This combination of green energy and digital infrastructure positions BBK as a viable location for companies looking to expand their digital infrastructure for emerging sectors like artificial intelligence (AI) and cloud computing to meet growing regional demand.

Minister Airlangga also noted that BBK was also gearing up for bigger data centres to meet the demand for new areas like quantum computing.

Mr Wiluan also highlighted Nongsa Digital Park’s current digital infrastructure and future development plans. He said the park’s location outside the seismic “Ring of Fire”, its proximity to Singapore, and its connectivity through 13 existing fibre optic cables (with two new subsea cables developed by Singtel-Telin and BW-Digital underway) make it an ideal base for high-density IT operations, scalable cloud solutions, and intensive AI workloads.

Nongsa Digital Park also has “13 data centre facilities being developed”, and NDP was committed to “provide up to 800 megawatts of power” for existing and future data centre investments.
 

The Batam-Bintan-Karimun region and Johor-Singapore Special Economic Zone (JS-SEZ) offer global companies cost-effective options to complement their activities in Singapore. For example, your regional headquarters and R&D activities can take place in Singapore, with broad-based manufacturing, and digital and software development located close by in the JS-SEZ and BBK. Learn about how you can partner Singapore to scale your business in Southeast Asia, one of the world's fastest-growing regions.