Danantara Indonesia and the Indonesia Investment Authority (INA) have entered into a conditional share subscription agreement (CSSA) with Chandra Asri Group to fund the development of a chlor-alkali and ethylene dichloride (CA-EDC) plant in Cilegon, Banten, according to its statement on Tuesday.
The signing marks the transition from a previously agreed memorandum of understanding into a binding capital commitment, with Danantara and INA coming in as strategic investors in the project.
The $800 million CA-EDC facility has been designated a National Strategic Project and is aimed at boosting domestic production of caustic soda and ethylene dichloride—two key industrial inputs that Indonesia still imports in significant volumes.
The project is expected to support downstream industrialisation and reduce reliance on overseas supply, in line with the country’s broader economic transformation agenda.
Danantara and INA will jointly invest $200 million into the plant, which will be developed and operated by PT Chandra Asri Alkali (CAA), a subsidiary of Chandra Asri Group. Commercial operations are targeted to begin in 2027.
Once operational, the plant will have an annual capacity of 400,000 tonne caustic soda and 500,000 tonne ethylene dichloride. Caustic soda is widely used in detergents, alumina processing, and paper manufacturing, while EDC is a key feedstock for construction and packaging materials.
Pandu Sjahrir, chief investment officer of Danantara Indonesia, said the agreement reflects the institution’s focus on high-value-added industries that can generate jobs and accelerate growth. The project is also expected to create around 3,000 jobs during construction and 250 permanent roles once operational.
INA’s acting CEO Eddy Porwanto described the investment as aligned with its mandate to channel long-term capital into priority sectors. Chandra Asri president director and CEO Erwin Ciputra welcomed the sovereign funds’ participation, saying it would help strengthen domestic supply chains and enhance the resilience of Indonesia’s chemical industry.
President Director and CEO of Chandra Asri Group, Erwin Ciputra, added, “We expect the CA-EDC project to significantly reduce dependency on imported strategic chemicals, strengthen national supply chain resilience, and support downstream industrialization [..].”
