Singapore Banks Fund $411 Million Data Centre Campus in Indonesia to Boost Digital Economy
In a landmark move to bolster Southeast Asia’s digital infrastructure, Singapore’s leading financial institutions, DBS Group and United Overseas Bank (UOB), have jointly provided a IDR 6.7 trillion (approximately $411 million) loan to finance the development of a state-of-the-art data centre campus in Batam, Indonesia. This deal, announced on June 5, 2025, marks the largest rupiah-denominated financing agreement ever secured for a data centre project in the region, underscoring Indonesia’s growing role as a digital hub in Southeast Asia.
The project, a joint venture between Singapore-based data centre developer DayOne and the Indonesia Investment Authority (INA), Indonesia’s sovereign wealth fund, will see the construction and operation of three advanced data centres within the Nongsa Digital Park (NDP) in Batam, a strategic location just across the Singapore Strait. Set to be completed by the end of 2025, the campus is expected to deliver a combined IT load capacity of 72 megawatts (MW), accounting for approximately 5% of Indonesia’s projected data centre capacity of 1.41 gigawatts (GW) by 2029.
A Strategic Investment in Southeast Asia’s Digital FutureThe financing deal comes at a time when demand for data centres in Asia is surging, driven by the rapid adoption of artificial intelligence (AI), cloud computing, and digital transformation across industries. According to a 2024 report by the Boston Consulting Group, Southeast Asia’s data centre demand is projected to triple to 6.5 GW by 2030, with the Singapore-Johor-Batam corridor expected to meet nearly half of this demand, reaching up to 3.3 GW. This corridor, a critical hub for data traffic, positions Batam as a pivotal gateway for digital connectivity between Singapore and Indonesia.
“This landmark financing — the largest rupiah-denominated facility ever secured for a data centre development — is a strong endorsement of DayOne’s proven ability to deliver digital infrastructure at speed and scale,” said Jamie Khoo, CEO of DayOne. “It reflects deep confidence in our long-term commitment to Indonesia and in the strategic importance of the DayOne NDP campus in strengthening the region’s digital backbone. Our campus will be home to Indonesia’s most advanced AI-ready data centre, designed to support the next wave of digital transformation.”
Amit Sinha, Group Head of Telecommunications, Media & Technology, Western MNCs, and Digital Economy at DBS Bank, emphasized the strategic significance of the project: “This transaction is a strategic investment in the future of Southeast Asia’s digital economy. Expanding the region’s data centre capacity will accelerate the digital transformation of businesses as they embrace solutions such as AI, cloud services, and real-time processing. The strengthened digital connectivity between Indonesia and Singapore better positions both markets to capture growing regional demand for computing power.”
The Nongsa Digital Park, located in Batam, is envisioned as a “digital bridge” connecting Singapore and Indonesia’s economies. The park enables Singapore-based companies to leverage Indonesia’s robust infrastructure and growing digital talent pool while allowing Indonesia to benefit from Singapore’s technological advancements and investment flows. The data centre campus, developed by DayOne and INA, will play a critical role in this vision, fostering cross-border collaboration and innovation.
Harapman Kasan, Wholesale Banking Director at UOB Indonesia, highlighted the alignment with national goals: “The partnership with DayOne and INA in building digital infrastructure that powers a low-carbon, digital economy aligns with Indonesia’s ambition to become a regional digital hub. Batam plays a pivotal role in serving as a key gateway to Singapore, and as a leading regional bank with deep ASEAN connectivity, we enable inclusive growth by connecting capital to infrastructure that drives innovation and sustainability.”
This project marks a significant milestone for both DayOne and INA. For DayOne, a global data centre pioneer and the international arm of Chinese operator GDS Holdings, the Batam campus represents a major expansion of its presence in Indonesia, building on its network of facilities across Singapore, Johor (Malaysia), Greater Bangkok, Hong Kong, and Tokyo. The company, which acquired land in Batam in November 2021, has secured significant investments from firms like SoftBank Vision Fund and Citadel, positioning it as a leader in next-generation digital infrastructure.For INA, this is its first foray into the data centre sector, reflecting its strategic focus on high-impact investments that drive Indonesia’s economic growth. Established as Indonesia’s sovereign wealth fund, INA has been actively pursuing opportunities in renewable energy, infrastructure, and digital technology, with this project reinforcing its commitment to fostering a sustainable and innovative digital ecosystem.
The Batam data centre campus is poised to contribute significantly to Indonesia’s digital economy, which is projected to grow rapidly as businesses and consumers increasingly rely on AI, cloud computing, and real-time data processing. The project’s completion will enhance Indonesia’s appeal to international investors, particularly in technology and digital services, while creating high-skill job opportunities in Batam and beyond.Moreover, the initiative aligns with broader sustainability goals. While specific details on the campus’s environmental features were not disclosed, the involvement of DBS and UOB, both recognized for their leadership in sustainable finance, suggests a focus on energy-efficient infrastructure. DBS, for instance, has been awarded the “Safest Bank in Asia” for 16 consecutive years and was named Indonesia’s Best Bank for ESG in 2024, reflecting its commitment to responsible banking. Similarly, UOB’s participation underscores its dedication to financing projects that support a low-carbon economy.
A Catalyst for Regional Digital GrowthThe $411 million financing deal is more than a financial transaction; it is a strategic investment in Indonesia’s ambition to become a regional digital powerhouse. With the DayOne-INA joint venture, the Nongsa Digital Park is set to become a cornerstone of Southeast Asia’s digital infrastructure, supporting the region’s growing demand for computing power and fostering economic integration between Singapore and Indonesia.
As the project progresses toward its 2025 completion, industry observers anticipate it will attract further investments in Indonesia’s digital sector, positioning the country as a key player in the global digital economy. For businesses and investors, the Batam data centre campus represents a unique opportunity to capitalize on Asia’s digital transformation, with far-reaching implications for economic growth and innovation.
