Indonesia is advancing plans to merge its national flag carrier, Garuda Indonesia, with Pelita Air, a subsidiary of state energy company Pertamina.
The consolidation effort is being driven by Danantara, the state-owned investment holding company, in coordination with the State-Owned Enterprise Management Agency (BP BUMN).
The move signals a broader push by Jakarta to restructure and strengthen its state-owned aviation assets amid competitive pressures in the Southeast Asian market.
The proposed merger aims to create a more robust national airline by combining Garuda’s passenger network with Pelita’s cargo and charter capabilities.
By integrating these entities, the government seeks to improve operational efficiency, reduce overhead costs, and enhance the overall competitiveness of Indonesia’s aviation sector.
This strategic alignment reflects a wider trend of state-led consolidation in emerging markets, where governments are increasingly intervening to bolster national champions against private and foreign rivals.