February 13, 2026 | 02:18 pm
TEMPO.CO, Jakarta - The Chairperson of the National Economic Council (DEN), Luhut Binsar Pandjaitan, is preparing several recommendations to improve the Indonesian capital market following a recent assessment by Morgan Stanley Capital International (MSCI). The proposal is currently being finalized and will be presented to President Prabowo Subianto to strengthen the credibility and attractiveness of domestic investments.
"Now, there are also members of the Council 'shopping around,' looking at capital markets across ASEAN," Luhut told reporters at his office in Central Jakarta on Friday, February 13, 2026.
Luhut explained that the DEN will also compare capital market practices in several Asian countries for evaluation. He specifically mentioned India's success in conducting reforms and building market credibility, which resulted in fund inflows significantly outpacing outflows.
According to Luhut, Indonesia has a similar opportunity if it can strengthen its commitment to independence and transparency. "Based on India's experience, once they implemented sound reforms and built solid credibility, incoming funds were nine times greater than the outflows; we hope the same will happen in Indonesia," he said.
In addition to regulatory and governance improvements, Luhut is considering the suggestion of refreshing leadership within the capital market sector. He proposed the idea of finding young individuals with strong experience and credibility.
He emphasized the importance of bringing in professional individuals who are not easily influenced, yet maintain direct access to report developments to the President. According to Luhut, credibility is the key to strengthening Indonesia's position in the eyes of global investors.
These improvements are expected to increase investor confidence and strengthen Indonesia's position in global indices, while also encouraging more stable and sustainable capital inflows. "Look for young individuals with experience and credibility to lead the capital market, those who cannot be easily influenced by anyone," said Luhut.
Previously, MSCI temporarily froze the rebalancing of Indonesia's stock composition. According to MSCI, investors are concerned about the transparency of the ownership structures within Indonesian equities.
"While there have been minor enhancements to PT Bursa Efek Indonesia's (IDX) float data feed, investors highlighted that fundamental investability issues persist due to ongoing opacity in shareholding structures and concerns about possible coordinated trading behaviour that undermines proper price formation," MSCI stated in its announcement on Wednesday, January 28, 2026.
To address some of these concerns, MSCI stated that more detailed and reliable information regarding stock ownership structures is required, including monitoring high concentrations of ownership, to support assessments of free float and investment capability across all Indonesian stocks. Consequently, MSCI took action by temporarily freezing stock adjustments.
Read: IDX Flags High Market Volatility After MSCI Publication
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