Batam. Nongsa Digital Park, a special industrial area for tech companies located on the island of Batam, has received $1.5 billion worth of investment, Chief Economic Minister Airlangga Hartarto said on Friday.

Indonesia is predicted to become the second largest public cloud market in the region with major cloud service providers such as Google Cloud, Amazon Web Services, Microsoft Azure, and Alibaba Cloud launching cloud regions in the country.

Batam, in close proximity to regional economic powerhouse Singapore and Malaysia, is being developed into a major hub for the fast-growing cloud market in Southeast Asia.

“There are more than eight investors for data center projects here and they have invested $1.5 billion,” Airlangga said after the ceremony to break ground on a data center facility developed by Chinese data center operator GDS Holding in Nongsa Digital Park.

The 28 MW data center campus is built at a cost of $200 million, occupying 10 hectares of land at the 167-hectare park.  

The government aims to produce 150MW to 400MW data center capacity overall from companies that build their facilities in the park.

Batam in Riau Islands Province has been designated as a special economic zone that offers generous tax incentives and exemptions from import duties.