Tuesday, September 26, 2023

China's Xinyi to Invest $11b in Quartz Sand Industry in Batam

Jayanty Nada Shofa
July 20, 2023 | 10:48 am
Investment Minister Bahlil Lahadalia (center) meets Xinyi Group representatives in China on July 18, 2023. (Photo Courtesy of the Investment Ministry)
Investment Minister Bahlil Lahadalia (center) meets Xinyi Group representatives in China on July 18, 2023. (Photo Courtesy of the Investment Ministry)

Jakarta. Chinese glass giant Xinyi Group seeks to make an $11 billion investment in the quartz sand downstream industry that lies in Rempang eco-city in Batam, Riau islands, according to Investment Minister Bahlil Lahadalia.

Bahlil earlier this week flew to China to meet potential investors, among others, Xinyi Group, which produces automobile glass and solar panels, to name a few. 

“I consider Xinyi as one of the world’s leading industrial players. If God is willing, they will make an investment in Rempang,” Bahlil was quoted as saying in a press statement on Wednesday.

During his trip, the minister sought to show Indonesia’s intention to capture more added value out of its commodities by processing the raw materials domestically. The downstream industry for nickel is already in progress, and the resource-rich country is now working on expanding it to other commodities.


“We have quartz sand, silica. But all this time, we have exported them in unprocessed forms. Developing a glass and solar panel ecosystem is part of our efforts to drive industrial downstream in the quartz sand sector,” Bahlil said.

Xinyi Group encompasses Xinyi Glass and Xinyi Solar. According to Gerry Tung, the chief executive officer of Xinyi Group, Indonesia’s improved climate investment and robust economic potential prompted the company to invest more in Indonesia. Xinyi at present has invested in a production plant in Gresik's JIIPE industrial park.

“Over the past years, we have seen how great the investment [climate] in Indonesia is. Many things have changed. We have invested in Gresik and seeing its growth prompted us to go for other industries, including Batam,” Gerry said.

Last year, Xinyi Glass inked an agreement with JIIPE developer BMKS for the purchase of a large land plot in the industrial park. The Chinese glassmaker also signed a deal with BMKS on the installation of water and electricity to support its plant’s construction and operations.

China is Indonesia’s second-largest foreign investor with an accumulated total investment of $24.55 billion from 2018 to Q1-2023, the government reported. 

China mostly invested in Central Sulawesi ($6.88 billion), West Java ($5.21 billion), North Maluku ($3.83 billion), Jakarta ($1.74 billion), and Banten ($1.45 billion). 

Chinese investments also mainly went to basic metals ($8.61 billion); transport, warehouse, and telecom ($6.69 billion), electricity, gas and water ($2.75 billion). Followed by real estate, industrial parks and offices ($1.74 billion) as well as chemical industries ($1.95 billion).

A government roadmap shown by the Investment Ministry earlier this year revealed that the country would prioritize driving downstream across 21 commodities like coal, bauxite, salt, and seaweed, among others, over the next few decades. Developing the downstream industries across all these commodities, however, would need an investment of $545.3 billion until 2040.

Read More: Indonesia’s Downstream Industry Plan Needs $545.3b Till 2040

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