In the advent of the Fourth Industiral Revolution, Indonesia has been restructuring and strengthening its National Innovation System (NIS). However, since the Indoneisan NIS was set-up decades ago and there are many stakeholders, more concerted efforts have to be made in order to have an effectively working NIS in order to improve Indonesia’s global competitiveness. The latest assessment of Indonesia's condition of science & technology (S&T) development has been formally incorporated into its National Mid-Term Planning 2020-2024. In 2021, the Indonesian government made a big change in its National Innovation System by making BRIN (National Research & Innovation Agency) the mega-integrated national research insitutes which has incorporated various research institutes.
According to the findings of the situational analysis, there are four significant concerns in the area of S&T development that need to be addressed in Indonesia's NIS:
• How can the utilization of science and technology as a driver of sustainable economic growth be increased?
• How can the capability for technology adoption and innovation be increased?
• How can the innovation ecosystem be developed?
• How can the effectiveness of the Science, Technology, & Innovation (STI) Fund be increased?
Considering the mentioned problems and development objective of the Indonesian STI system, it is very timely to address the following important questions:
• How a think tank can promote STI development, what type of STI think tank to establish, and how to operate it?
• How can good governance among STI related stakeholders be set-up to have an effective and sustainable STI system in Indonesia?
• How can national research & innovation programs (R&D programs) be effectively planned and managed; what are the structure and mechanisms to do it, including the actors and process of national R&D programs?
• What kinds of STI law and regulation are necessary? And which contents have to be inserted?
2. 2021 K-Innovation with Indonesia
The 2021 K-Innovation ODA Program with Indonesia has three objectives. The first objective is to support Indonesian policy-makers and researchers in implementing policy recommendations on the establishment of a new design of an STI think tank in Indonesia, to design an evaluation mechanism for national research programs (PRN), and restructure S&T regulations in Indonesia. The second objective is to increase policy research capacity building through collaboration research between Korean experts and Indonesian researchers & workshops. The fourth objective is to strengthen STI cooperation between Korea and Indonesia as part of Korea’s New Southern Policy.
The 2021 K-Innovation ODA Program consists of four activities as follows: The kick-off seminar, joint research to produce a policy consulting report, and capacity-building & dissemination workshops (in a webinar format due to COVID-19 restrictions). The first phase is to hold a kick-off seminar between the STEPI team and BRIN (formerly Indonesian Institute of Sciences, LIPI) to discuss the details of activities for 2021 and evaluate last year’s activities. At the kick-off seminar, Korean experts give presentations on Korean practices based on the themes in cooperation with Indonesian experts from BRIN.
The Korean experts collaborate with Indonesian researchers for joint research on three themes of building a new STI think tank in Indonesia; evaluation mechanism for national research program; and restructuring S&T regulations in Indonesia. Three teams are supervised by Korean experts assigning focal points for Indonesian researchers. The capacity-building program for Indonesian researchers in Korea is an important part of K-Innovation. Regardless of the COVID-19 restrictions hindering flexibility to organize a capacity-building program for Indonesian researchers in Korea, K-Innovation warrants that Korean specialists share Korean methods and exchange ideas on the topics of their responsibility via videoconferencing. The last activity is a dissemination seminar by which the research teams can present and receive feedback on the policy consulting outcomes from the Indonesia’s STI community. In addition to the dissemination seminar, Korean and Indonesian researchers work to publish academic papers based on the outcomes of 2021 K-Innovation.
3. Outcomes of Policy Consulting
The 2021 K-Innovation with Indonesia focused on consulting to address three key issues for Indonesia’s National Innovation System (NIS):
• Building an STI think tank in Indonesia
• Designing an evaluation mechanism for national research programs (PRN) 2020-2024
• Restructuring law and regulations on S&T in Indonesia
To address the concerns above, the research teams of Korea and Indonesia conducted joint researches with four major activities—such as conceptualization, focused group discussions (FGD), in-depth interviews, and workshops—to disseminate the outcomes of research with the stakeholders from both countries.
3.1 Policy Recommendations for Building a New Think Tank for Science & Technology Innovation in Indonesia
The establishment of a think tank in Indonesia should take into account existing legislation, norms, and institutions in order to achieve feasible STI policy governance. Nonetheless, establishing a new think tank unit focused on STI policy in the global arena would be difficult, and may even conflict with other legislation or agency goals. Indeed, the intent of top management, as well as political will, has a role in the establishment of an STI policy think tank unit. This research suggests four different STI policy think tank units that could be established and built in Indonesia.
The ideal condition cannot be reached due to the current obstacles in Indonesia. Before one of the options can be implemented, there are important issues that must be addressed. Firstly, there is a need to reform the rigidity to enable a more flexible bureaucracy apparatus. A less flexible system may negatively impact finance, law, and administrative procedures, for instance. Managing funds from both government and other sources requires creating a new form of think tank such as quasi-independent and independent think tanks in Indonesia. Secondly, a favorable coordination system should be structured among state-run agencies. In addition, an STI policy think tank needs coordination with a wide range of stakeholders. Thirdly, Indonesia needs to increase the number and pool of technical human resources in STI policy. The limited number of researchers performing functions in STI policy studies and lack of data on STI also result in a shortage of technical human resources in STI policy. Fourthly, evidence-based policymaking on STI should be strengthened. In most cases, policymaking without evidence tends to lead to trial judgment & errors. Fifthly, it is necessary to develop an enabling environment for promoting innovation. In Indonesia’s case, state-run bodies should have the same frequency for synergy to create an innovation system. The Ministry of Research & Technology (MoRT)/ National Research & Innovation Agency (BRIN) can be the main actor for constructing NIS among the institutions.
3.2 Policy Recommendations for Management & Evaluation of R&D Programs
The new Law No. 11 Year 2019 has mandated the integration of all public R&D institutions in Indonesia under the auspices of the Ministry of Research & Technology/ BRIN to ensure the sustainability of one-way R&D activities in order to increase R&D capacity in national development. Nonetheless, the definition of ‘integration’ under this rule has sparked some debate over how it should be accomplished. The STEPI-LIPI team came up with three key governance solutions for the Research Endowment Fund.
The Research Endowment Fund can be evaluated in two ways. Option 1: The Ministry of Research & Technology/ BRIN can carry out the review process. The Ministry of Research & Technology/ BRIN has the role of ensuring that the different programs and policies enacted may support R&D activities, leading to the fulfillment of national development goals, as an actor in charge of managing R&D matters under the government. The Ministry of Research & Technology/ BRIN has sufficient capacity and capability to undertake evaluations, which are backed up by skilled personnel. This alternative is based on the belief that evaluations conducted by an independent organization other than policy-makers can ensure a more objective evaluation process. This assessment will be used by the Ministry of Research & Technology/ BRIN to plan the next program. In such an instance, the Academy of Indonesian Science (AIPI) may be entrusted with evaluating the research endowment fund's programs and projects. This option would be preferable to the preceding one.
3.3 Policy Recommendations for the Management & Evaluation System of the National R&D Program
The Indonesian government has a long- and mid-term R&D policy such as the National Research Master Plan (RIRN) (2017~2045), which is the Master Plan on the national R&D program and National Research Priority (PRN) to be updated every five years. This implies that Indonesia has infrastructure in place for the formation, implementation, and evaluation of an R&D program and a strong political will to implement its R&D policy. Even so, it appears that Indonesia remains at the early stages of implementating national R&D programs, without a clear ex-ante and ex-post evaluation processes. In addition to this research, the investment target for R&D announced by the Indonesian government is not insufficient to sustain R&D programs, while financing sources for implementing R&D programs are not determined. The cooperation mechanism between industry and national research institutes is still ineffective. Due to their shortage of R&D capabilities, industries are not focused on innovation, and some state-owned enterprises in Indonesia are primarily responsible for R&D.
Policy recommendations for Indonesia include as follows: 1) R&D investment should be increased as long as there are clear indications of R&D funding sources; while programs should be developed to induce the private sector to make R&D investment; and 2) the governance for R&D policy and programs sould be restructured. By doing so, ex-ante and ex-post evaluation and implementation of R&D programs and projects can be efficiently carried out, and cooperation and coordination among research actors (national research institutes & universities) can be effectively facilitated.
3.4 Laws & Regulations of Science & Technology
For starters, STI governance and law in Indoneisa is in the process of going through massive changes but there are also difficluties due to the large-scale changes.
• Law 11-year 2019 is a law with a significant meaning to reorganize Indonesia's science & technology governance.
• The legislation's primary purpose is to integrate public research institutes under the newly launched National Research & Innovation Agency (BRIN).
In this background, Korean STI laws were reviewed historically to see the reasons for the development of each law. Especially those laws closely related to the formation of S&T governance were reviwed. Those laws are related to 1) policy/ budget coordination, 2) the governance structure of public research institutes, 3) policy instruments, especially on national R&D programs, and 4) establishment of professional R&D management agencies.
This study introduced the structure and function of BRIN, which was launched in 2021 and translated its Indonesian name into Korean for the first time.
• In this process, four functional areas of BRIN were identified, which are as follows: 1) Policy functions related to the planning, budgeting, & evaluation of R&D programs, 2) management of the Research Endowment Fund, 3) balancing the principles of accountability and autonomy for integrated public research institutes, and 4) supervision of BRIN
The Indonesian government intends to innovate its science & technology system by Law No. 11-year 2019.
• The current change in Indonesia can be seen as a situation similar to when Korea reformed its structure of state-funded research institutes in 1999 and enacted the Framework Act on Science & Technology in 2001.
• It is recommended to benchamark Korean Acts which are the Science & Technology Promotion Act, the Science & Technology Framework Act, Act on the Establishment, Operation, & Fostering of Government-Funded Research Institutes, and Industrial Technology Promotion Act.
In the advent of the Fourth Industiral Revolution, Indonesia has put its national priority on building STI capacity, aiming to achieve a knowledge-based economy in the mid and long term. The 2021 K-Innovation program contributes to Indonesia’s STI development by providing policy consultation on the national innovation system of Indonesia, which is one of the key partner countries in Korea’s diplomatic policies. Policy suggestions are drafted from K-Innovation’s activities led by Korean experts with Indonesian researchers to improve the STI system in Indonesia. More specifically, Koreans shared insights and policy directions based on Korean and Indonesian practices regarding the STI think tank, STI law and regulation, and management and evaluation system of the national R&D program. STEPI has been supporting LIPI – which became part of BRIN over the last several years through the K-Innovation program. It is believed that the STI cooperation at the institutional level would contribute to strengthening cooperation at a national level as well.