“We’re encouraging our guys to focus on the fundamentals of Indonesian businesses because they’re growing healthily,” Pandu Sjahrir, Danantara’s chief investment officer, told Fortune on the sidelines of the DBS Asia Future Forward Conference in Singapore on Oct. 12. “Why wouldn’t we be buyers of these types of businesses? It’s our job to look at, support and buy great companies.”

This comes as the sovereign wealth fund, launched by Indonesian President Prabowo Subianto in 2025, steps up as a stabilizer for the country’s stock market, currently under scrutiny from global index providers like MSCI.

On Oct. 15, days after Fortune’s interview with Pandu, MSCI proposed downgrading the country from emerging-market to standalone status. This would remove Indonesian stocks from MSCI’s emerging and frontier-market indices and prompt investment funds to consider reducing their exposure to the country. The country has until April 2027 to enact reforms. (Indonesia recently preserved its Secondary Emerging status in FTSE Russell’s annual count)

That news sparked an 11.6% plunge in the benchmark Jakarta Composite Index. The index is now down just over 40% for the year—showing just how much Indonesia still needs to do to convince global investors to back its companies, and why Danantara is stepping in.

“Once there’s a shift in perception, even if the fundamentals are good, the stocks will see a downturn,” Pandu admitted. “Overall, Indonesian consumer stocks are down over 20%, and that isn’t even as bad as those related to mining or energy.”

‘Economic value,’ not necessarily ‘commercial value’

Pandu, who made his name in the private sector, now has to focus on different metrics than a straightforward return on investment. “The idea is to create economic value, and not necessarily commercial value first—that’s an important distinction,” Pandu explained. “If the projects serve as a significant economic multiplier and remain within the cost of capital range, we’ll most likely fund it.”

Danantara has four arms: asset management, investment management, the Danantara Development Management Fund (DDMF) and Danantara Resources Indonesia.

The fund’s asset management wing supervises and corporatizes more than 1,000 of Indonesia’s state-owned enterprises, while its investment management segment seeks to maximize returns via bonds, public markets, and domestic and foreign equities. 

The DDMF is Danantara’s arm with the strongest social mandate. It deploys long-term capital toward national infrastructure projects with high social yield but lower immediate commercial returns. Among them is the Giant Seawall Project, a multi-segment complex along the Northern coast of Java set to take up to 20 years to build, and a coal gasification program.

A fourth unit—Danantara Resources Indonesia—fully launches next January. In Pandu’s telling, it’ll serve as a single digital platform that centralizes the exports of Indonesia’s natural resources, starting with its top three: coal, palm oil and ferroalloys. (The country is the world’s top exporter of nickel products, contributing over 60% of global supplies, according to Reuters.)

“We’ll be using a lot of technology to ensure we do the reporting well,” Pandu said. “We’ll try to do those three [commodities] really well first, and then we’ll go from there.”

Yet the snap decision to have Danantara take over exports—announced by Prabowo in May—has unnerved analysts who worry about encroaching state control of the economy, as well as at the sovereign wealth fund. 

“Under normal conditions, investors might take more time to assess the policy details,” Dedi Dinarto, the associate director at strategic advisory FGS Global, told Nikkei Asia in May, when the proposal was first announced. “But when the rupiah is under pressure, and the equity market is already weak, introducing a new layer of state control mechanism over strategic assets can quickly become a confidence issue.”

‘Get paid to learn’

Pandu wants Danantara to double down on partnerships and human capital next year. On Oct. 6, Danantara announced it was investing $250 million in HighPeak Energy, a Texas-based oil and gas producer.

“The collaboration is a way for us to learn about shale technology, which isn’t often seen in Indonesia,” Pandu said. “What we want to do is to learn about new technologies, how to de-risk them, and bring that knowledge back.”

“If we are able to have some good downside protection, we get paid to learn,” he added.

The sovereign wealth fund is also making strategic hires. In 2025, Danantara hired two executives from Singapore’s GIC, Daniel Lim and Weihan Wong, to lead its global private market coverage. Danantara now has around 500 employees. 

“The way we look at it—at least during my time—is how we can bring the best human capital [to Indonesia], and encourage the transfer of knowledge for the benefit of Indonesians,” Pandu concluded. 

And despite the challenges of running a sovereign wealth fund in a country under scruntiny, Pandu said he still gets “butterflies” at work. ”I wouldn’t trade it for the world, man.”