Indonesia Moves to Revamp Film Laws, Empower National Agency, and Transform Jakarta into a Regional Cinematic Hub

Indonesia is aggressively overhauling its cinematic landscape on two critical fronts. At the national level, the country’s film agency is actively assisting in drafting a revised Film Law designed to overhaul its powers, secure dedicated funding, and solve structural coordination hurdles. Meanwhile, in the capital, Jakarta is rapidly scaling up its infrastructure and incentives—bolstered by a growing slate of major international productions like Netflix’s four active local titles—with the explicit ambition of transforming into a premier regional film hub on the scale of Busan.

The dual push comes at a transformative time for the Southeast Asian nation. While local productions captured approximately 67% of the domestic box office last year, industry leaders argue that the infrastructure, international distribution channels, and institutional financing mechanisms have not kept pace with the country’s surging creative output.

Shaping a New National Film Framework

Fauzan Zidni, chair of the Indonesian Film Agency (BPI), tells Variety that the first draft of the revised Film Law, prepared in close collaboration with the Ministry of Culture, has taken shape since the Cannes Film Festival.

"It is still in discussion, and I will say more when the moment is right, but the direction is right and the momentum is there," Zidni says.

Unlike comparable national film bodies around the world—such as France’s CNC, South Korea’s KOFIC, or Singapore’s IMDA—Indonesia’s BPI currently operates without the statutory authority to independently fund films or mandate policy. While the agency can effectively convene stakeholders, advocate for the industry, and coordinate initiatives, it lacks the institutional teeth and ring-fenced financial backing of its international peers. Zidni hopes the legislative overhaul will finally grant the agency these necessary powers.

Furthermore, the domestic film industry currently navigates oversight from two separate government ministries. Zidni notes that BPI is not attempting to replace either ministry, but rather tackle the complex institutional and political coordination problems that have historically slowed industry progress. While he describes the current support from the Minister of Culture as the strongest it has been in years, no firm date has been set for passing the legislation through parliament.

Jakarta’s Ambition to Become Southeast Asia’s Busan

While national lawmakers work on legislative reforms, the capital city of Jakarta is making aggressive moves on the ground. Spearheaded by veteran actor, filmmaker, and Vice Governor Rano Karno—under the broader vision of Governor Pramono Anung—Jakarta is working to position itself as a regional film powerhouse modeled after South Korea’s Busan.

The city’s ambitions received a major operational boost in June with the launch of the Jakarta Film Commission alongside "Filming in Jakarta," a newly established one-stop service designed to streamline permits and support producers. According to Karno, international production companies from countries like Malaysia and India have already utilized the service to shoot films and series in the capital.

The most prominent validation of the city’s new approach comes from Netflix. Following the production of "Tygo," the streaming giant’s spinoff of the action hit "Extraction," Netflix has expanded its footprint significantly in the capital.

"We’re very happy to say that Netflix now is doing [four] titles […] through Filming in Jakarta," Karno says. Under a memorandum of understanding tied to the inaugural Jakarta Film Summit, Netflix has also committed to helping develop local film talent.

To accelerate this growth, Jakarta has already implemented significant financial adjustments, cutting certain location fees by 50% and introducing a 50% tax concession on cinema admissions for qualifying Indonesian films. Karno notes that the city has barely scratched the surface regarding production incentives and is actively studying models from Thailand and Malaysia to refine its strategy.

Infrastructure remains one of the most pressing challenges. Over the next three to five years, the city aims to fill its most glaring gaps—namely post-production facilities, soundstages, and dedicated studios—to complete a fully realized film ecosystem spanning production, financing, and market access.

Busan has served as a crucial international partner in this journey. Karno credits the Busan Film Commission with helping the Jakarta Film Commission secure official membership in AFCNet, the Asian Film Commissions Network.

"It’s a momentum for us to be known [as the] future film hub in the region," Karno says.

To ensure that the economic benefits of the boom reach beyond the capital’s elite circles, Jakarta is collaborating with Bank Indonesia’s Jakarta representative office to support the film and creative economy sectors. Initiatives like Jaksinema—which brings pop-up cinemas into public markets with cheaper tickets tailored for lower- and middle-income audiences—aim to broaden domestic cinematic engagement. Karno, who has spent over five decades navigating the industry’s challenges, expects the Jakarta Film Summit to become an indispensable fixture on the global calendar as the city pushes toward its goal of becoming a recognized City of Cinema.

Unlocking Intellectual Property Financing

Beyond infrastructure and production incentives, the Jakarta Film Summit is directly targeting what Zidni identifies as the single greatest barrier to institutional investment in Indonesian cinema: intellectual property financing.

Traditional commercial banks lend against tangible physical assets such as land, buildings, and machinery—collateral that independent production houses rarely possess. Film intellectual property, including copyright, broadcast rights, and distribution rights, currently lacks a standardized valuation method accepted by traditional lenders or Indonesia’s Financial Services Authority (OJK).

While Government Regulation No. 24 of 2022 on the Creative Economy technically permits IP-based financing, the missing link has been the lack of technical guidelines from the OJK and a necessary revision of OJK Regulation No. 40 of 2019 concerning asset quality, which would allow IP to formally count as bankable collateral.

To bridge this gap, the film summit is bringing together the OJK, the Ministry of Creative Economy, the Directorate General of Intellectual Property (DJKI), commercial banks, and the Indonesian Appraisers Association. Their shared goal is to establish a standardized IP valuation methodology, develop a pilot financing scheme, and map out a clear regulatory path forward.

Bridging International Markets and Talent

Despite local films dominating the domestic box office with a 67% market share last year, Zidni points out that 2026 box office growth is tracking at a slower pace amid broader global economic pressures. Furthermore, he emphasizes that the industry has yet to successfully build the bridges necessary to carry domestic stories outward to global audiences.

At the Lumière Summit, the Ministry of Culture announced a new international co-production fund developed with the support of France’s CNC, designed to welcome filmmakers worldwide who partner with Indonesian creators. This sits alongside a government matching fund that contributes up to a set financial ceiling per project for producers who successfully secure international financing.

Zidni readily concedes that the matching fund alone will not immediately aid independent producers who lack existing overseas contacts. However, he argues that the initiative creates a tangible incentive to build those vital international relationships.

Bilateral ties are steadily expanding. Indonesia signed its first official audiovisual co-production agreement with the Netherlands at the JAFF Market in 2024, and active talks for a similar treaty with France are underway. With South Korean producers increasingly looking toward Southeast Asia, Zidni views Indonesia as the most logical regional partner due to its sheer scale, though he declines to provide a precise timeline for future treaties.

"We are no longer asking partners to believe in our intentions," he states.

Drawing on his previous experience working at Disney, Zidni witnessed firsthand how global streaming platforms abruptly pulled back from Southeast Asian original content after 2023.

"A platform can change its content strategy, exit a market, or deprioritize Indonesian content, and we have no recourse," he notes.

In response, BPI is heavily pushing for closer alliances with international sales agents, fostering regional distribution within Southeast Asia, and exploring ways for Indonesian producers to establish a collective, shared market presence.

Talent development remains another critical pressure point for the industry. While Indonesia’s film schools across 27 campuses produce approximately 1,200 graduates annually, the vast majority fail to be absorbed by the formal industry, resulting in an annual turnover rate of roughly 60%.

Zidni’s mandate as chair runs through 2030. By the end of his tenure, he aims to have at least two bilateral co-production treaties fully in force, a proven domestic IP financing system with an established track record, and Indonesian producers regularly attending major international film markets.

"When the system works routinely, not heroically, that is when I will know we have built something that lasts," he concludes.