LPDP and STEM

The recent decision by LPDP to increase the share of STEM scholarship recipients is a much-needed correction. For too long, Indonesia’s scholarship allocation has favored ambiguous “development” fields or MBA tracks that yield little marginal societal benefit.

However, the caveat is concerning: this new prioritization is tethered to vaguely defined “strategic industries.” That is a flawed approach. Today’s strategic darling might be AI and semiconductors; tomorrow, it could be humanoid robots, neuromorphic computing, or quantum photonics. Technological breakthroughs are inherently uncertain. Anchoring public investment to a narrow and bureaucratically defined industry list risks missing the real innovation curve.

What Indonesia truly needs is a coherent, bottom-up construction of the technological stack, starting from fundamentals. This means serious investment in mathematics, computer science, electrical engineering (beyond just power systems and power management, ok?), and certainly physics.

Even in AI, Indonesia lags not just because of a lack of “AI specialists,” but also due to weak foundations across the tech stack. Without that, no amount of AI hype will yield genuine capability. For example, I’ve tried to find people in Indonesia working on modern reinforcement learning methods (like GRPO), and it’s nearly impossible.

A broader philosophical correction is also in order: stop treating the government as a job provider. That logic has led to bloated bureaucracy, misaligned incentives, and widespread rent-seeking. The government’s role is not to create jobs directly, but to fix market failures, provide public goods, and de-risk fundamental investments, like basic research and core human capital.

I still hold the view that the net benefit of LPDP is close to zero. But if LPDP must exist, its limited resources should be directed to high-benefit, high-demand sectors: public health (doctors, nurses, psychologists) and education (especially STEM teachers for K-12). There is little justification for subsidizing MBAs or vaguely defined “development” degrees abroad; these carry ambiguous returns and often serve only to reinforce domestic elitism rather than genuinely improve the nation’s human capital.