A new data center that began operations in February 2025 on the Indonesian island of Batam is poised to alleviate some of the intense demand for digital infrastructure in Southeast Asia. Developed by Hong Kong’s Gaw Capital Partners and Jakarta-based Sinar Primera Group, the Golden Digital Gateway facility provides a crucial alternative for hyperscale and enterprise clients in a market constrained by a moratorium on new data center construction in the region’s primary hub, Singapore.
The facility’s opening addresses a significant capacity challenge that emerged after Singapore halted new data center developments in 2021 due to constraints on its power grid. This policy forced cloud providers and other large-scale data users to seek viable, low-latency alternatives to service the world’s fastest-growing internet market. Batam, located just a 30-minute ferry ride from Singapore, has emerged as a strategic location, offering close proximity and favorable economic conditions to support the region’s expanding digital economy. The Golden Digital Gateway is the first to become operational within the island’s Nongsa Digital Park.
A Strategic Response to Regional Constraints
The development of the Golden Digital Gateway is a direct market reaction to the power and land constraints that curbed growth in Singapore, traditionally the epicenter of Southeast Asia’s data center industry. In 2021, the Singaporean government’s moratorium forced operators and investors to re-evaluate their strategies, accelerating the development of a broader Singapore-Johor-Batam (SJB) corridor for digital infrastructure. The need for alternatives has become critical as data consumption in Southeast Asia continues to surge, driven by rapid digitization, the expansion of cloud services, and the rise of data-intensive applications like artificial intelligence and the Internet of Things. Batam’s inclusion in a Special Economic Zone (SEZ) established by Indonesia and Singapore in 2018 as a “digital bridge” further enhances its appeal, offering tax incentives and operational efficiencies.
This strategic positioning allows facilities in Batam to function as a near-shoring option for companies requiring world-class IT infrastructure at a more competitive cost than Singapore. The Golden Digital Gateway offers very low-latency connectivity to Singapore, achieving less than 2 milliseconds of delay with diverse routing for redundancy, making it a viable extension of the Singaporean digital ecosystem. This proximity and performance effectively create a satellite hub capable of supporting the immense data traffic flowing through the region without overburdening a single location.
Inside the Golden Digital Gateway
The Golden Digital Gateway is a carrier-neutral colocation facility, allowing multiple telecommunication carriers to operate within it, fostering a competitive and resilient connectivity environment. The project was developed in phases, with the initial stage completed in just over nine months and launching in February 2025. This rapid deployment underscores the urgency of the market’s demand for new capacity.
Phase One Specifications
The first phase of the data center provides an IT power capacity of 5.2 megawatts (MW) and is situated on a 13,000-square-meter site. The facility is engineered to meet high standards of reliability and has achieved Tier III status, a certification that anticipates less than 1.6 hours of downtime annually. This level of performance is critical for financial institutions, cloud providers, and other enterprise clients that require near-constant availability for their digital services.
Future Expansion
The developers have planned a significant expansion for the facility’s second phase, which will add another 20 MW of IT capacity. While a specific timeline for this next stage has not been publicly released, the planned expansion reflects strong confidence in Batam’s long-term viability as a data center hub. This scalability is designed to accommodate the projected threefold increase in data center capacity expected across Southeast Asia by 2030, much of it driven by a tenfold surge in demand for AI computing.
Batam’s Emergence as a Digital Hub
The establishment of the Golden Digital Gateway is a cornerstone of Batam’s transformation into a key node for digital infrastructure. The facility is located in Nongsa Digital Park (NDP), an ecosystem designed to support tech companies, digital talent, and data services. The park was inaugurated in 2018 as a joint initiative between Indonesia and Singapore to foster the digital economy. Its status as a SEZ provides tangible benefits that attract international investment.
Batam’s growth is not isolated to a single project. The island is poised to develop more than 400 MW of data center capacity in the coming years. Other major international operators, including Princeton Digital Group and China’s GDS, are also building large-scale hyperscale campuses in the park. Furthermore, Indonesia’s Ministry of Communication and Information has announced plans to construct a National Data Center within the Nongsa SEZ, cementing its importance to the nation’s digital strategy. This concentration of investment is creating a vibrant, competitive market and a robust digital ecosystem just across the strait from Singapore.
The Partnership Powering the Project
The Golden Digital Gateway is a joint venture that leverages the distinct expertise of its two parent companies. Gaw Capital Partners, a Hong Kong-based private equity fund manager, brings extensive experience in designing, building, and operating data centers across Asia. The firm has been actively investing in digital infrastructure, with other projects in Malaysia and Vietnam, demonstrating a broad regional strategy.
Its partner, Sinar Primera Group, is an industrial developer with deep local knowledge and connections to the Jakarta-based conglomerate Sinar Mas. This collaboration combines global investment and technical capability with on-the-ground execution and an understanding of the Indonesian market. According to Sinar Primera Group head Hong Kah Jin, the partnership aims to accelerate the development of a stronger digital ecosystem in Indonesia by providing world-class infrastructure.
Economic and Technological Implications
The influx of data center investment into Batam carries significant economic and technological benefits for Indonesia and the wider region. It stimulates the local economy through construction and high-skilled job creation while also enhancing the country’s digital sovereignty and infrastructure resilience. By providing a robust local alternative, Indonesia can better support its own rapidly growing digital economy, which is fueled by high mobile penetration and strong internet adoption.
For Southeast Asia, the diversification of its data center footprint beyond Singapore creates a more resilient and competitive market. It provides hyperscalers and cloud providers with much-needed options for expansion, ensuring that the region’s digital growth is not hampered by infrastructure bottlenecks. The development of the SJB corridor allows for distributed architectures that can improve performance, reduce costs, and mitigate risks associated with concentrating critical infrastructure in a single geographic point. This evolution is vital as the region prepares for the next wave of technological transformation, including the widespread adoption of 5G networks and artificial intelligence.
