Aug 15, 10:03 AM

President Prabowo Unveils 2026 Budget with Rp 3,147.7T Revenue, 5.4% Growth Target, and Rp 300T Illegal Mining Crackdown

On August 15, 2025, Indonesian President Prabowo Subianto delivered his first State of the Nation address during the annual session of the People's Consultative Assembly (MPR) and the joint session of the House of Representatives (DPR) and Regional Representative Council (DPD) in Jakarta. In his nearly one-hour speech, Prabowo outlined Indonesia's economic achievements, strategic programs, and stern warnings against illegal mining activities. He highlighted Indonesia's economic growth of 5.12% in the second quarter of 2025, up from 4.87% in the first quarter, and set a target of 5.4% GDP growth for 2026. The president also announced the 2026 state budget (RAPBN) with a projected revenue of Rp 3,147.7 trillion and a budget deficit planned to narrow to 2.48% of GDP, aiming for fiscal balance within three years. The budget allocates Rp 402.4 trillion for energy resilience, Rp 508.2 trillion for social protection programs (an 8.6% increase from 2025), and a historic Rp 757.8 trillion for education, representing 20% of the budget. Prabowo emphasized the government's commitment to reducing extreme poverty to between 6.5% and 7.5% by 2026 and eliminating the tantiem (performance bonuses) in the budget. He condemned illegal mining, which involves 1,063 operations causing state losses estimated at Rp 300 trillion, and vowed to enforce strict measures against all parties involved, including active and retired military and police generals. The government has reclaimed 3.1 million hectares of land from illegal palm oil companies out of a total of 5 million hectares. Prabowo also pledged to combat corruption pervasive across all levels of bureaucracy and promote budget efficiency to save Rp 300 trillion. His address reaffirmed Indonesia's non-aligned foreign policy and the fight against "greednomics." The 2026 budget does not include new taxes, according to the finance minister. The speech marked a departure from previous years by omitting traditional ethnic costume parades and included acknowledgments of the contributions of former presidents Soekarno and Joko Widodo. The address was broadcast live on KompasTV and received attention from various media outlets.