Indonesia Airlines officially entered the aviation industry on March 7, 2025, marking its presence as a new commercial airline. Despite operating from Soekarno-Hatta International Airport in Indonesia, the airline is headquartered in Singapore. This decision has sparked discussions about its motivations and implications.
Indonesia Airlines: A New Player in Global Aviation
Indonesia Airlines is owned by Iskandar, an entrepreneur from Aceh, Indonesia. The airline operates under Calypte Holding Pte Ltd, a Singapore-based company with interests in aviation, renewable energy, and agriculture. The airline aims to provide a premium flight experience that combines the luxury of private jets with the comfort of commercial travel.
“We present a scheduled commercial airline offering premium services under the Indonesia Airlines brand,” said Iskandar, CEO of Indonesia Airlines, in an official press release received by Kompas.com on Sunday, March 9, 2025.
The airline’s initial operations will focus on international routes, utilizing modern aircraft. Its launch represents a significant development in Southeast Asia’s aviation sector, particularly with its strategic location in Indonesia, a major air travel hub.
Why Singapore? Possible Reasons Behind the Headquarters Decision
The decision to base Indonesia Airlines in Singapore rather than Indonesia has led to speculation. Some observers point to Singapore’s business-friendly environment as a key factor.
“Singapore is known for its competitive tax system, with a relatively low corporate tax rate (a maximum of 17%) and various incentives for new businesses and startups. In comparison, Indonesia’s corporate tax rate is higher (22% in 2025), and its tax bureaucracy is often considered more complex,” said X user (formerly Twitter) @ismailfahmi, cited by Tribun-Medan.com.
Singapore also offers high economic and political stability, making it an attractive base for international businesses. Its well-regulated financial sector, streamlined administrative processes, and investor-friendly policies provide a strong foundation for new ventures.
Reactions to Indonesia Airlines’ Singapore Base
The choice of Singapore as the airline’s headquarters has triggered reactions on social media. Some netizens speculate that Indonesia’s complex bureaucracy and issues like illegal levies and regulatory unpredictability influenced the decision.
Another user on X commented, “Indonesia Airlines is owned by an Indonesian, Mr. Iskandar, and is based at Soekarno-Hatta Airport. But why was it founded in Singapore? Lower taxes, more stability, easier bureaucracy, and no gang extortion.”
This sentiment reflects broader concerns about the challenges of doing business in Indonesia. Other industries, including tech startups like Ruangguru, have similarly chosen Singapore as their corporate base while maintaining significant operations in Indonesia.
Future Plans: Indonesia Airlines’ Expansion Strategy
Despite its Singapore headquarters, Indonesia Airlines plans to expand its presence in the global market. The airline’s initial fleet will consist of modern aircraft such as the Airbus A321neo, Airbus A350-900, and Boeing 787-9. It aims to establish flight routes across 30 countries within five years.
The airline’s long-term vision is to become a leading international carrier while showcasing Indonesian hospitality on a global scale. By prioritizing service quality and efficiency, it hopes to differentiate itself from competitors in the premium airline market.
Regulatory Challenges: Approval Needed in Indonesia
Although Indonesia Airlines has secured its flight permit, it still requires approval from Indonesia’s Ministry of Transportation to operate fully within the country. The Directorate General of Civil Aviation has yet to receive formal applications for its operational license.
Every airline must meet strict regulatory requirements, including obtaining an Air Operator Certificate (AOC) and a Scheduled Commercial Air Transport Standard Certificate. This process ensures compliance with safety and operational standards.
Final Thoughts on Indonesia Airlines’ Strategic Move
Indonesia Airlines’ launch and its decision to base its headquarters in Singapore highlight the complexities of the aviation industry. While its strategic move offers financial and regulatory advantages, it also raises questions about Indonesia’s business climate. As the airline expands, its success will depend on how well it navigates international regulations and market competition.
Source: kompas.com, medan.tribunnews.com
Image: dok.SINDOnews
