A major AI data center project in Indonesia has hit a regulatory roadblock shortly after breaking ground.
West Java Governor Dedi Mulyadi ordered Singapore-based BDx Data Centers to stop construction of its planned 640-megawatt AI Campus 2 in Jatiluhur until required permits are issued and its environmental impact assessment is completed.
The order puts an early obstacle in front of one of Indonesia’s largest planned AI infrastructure projects as operators race to add capacity for cloud and AI workloads.
Governor says permits must come before construction
Local officials said the outstanding requirements include an environmental impact assessment, known in Indonesia as AMDAL, and a building approval, or PBG.
Mulyadi said the provincial government continues to support the investment, but that construction cannot proceed before the necessary approvals are in place.
“The project is being halted not because it violates environmental rules. It’s being halted because the permits have not yet been issued,” Mulyadi said in a video posted to YouTube, according to Reuters.
Reuters also reported that BDx did not respond to a request for comment and that it was not immediately clear whether construction had already stopped.
BDx planned 640MW campus for growing AI demand
BDx announced the groundbreaking for the CGK4 campus on Sept. 22, with Mulyadi and Purwakarta Regent Saepul Bahri Binzein attending the ceremony.
According to The Jakarta Post, the campus has secured 845 MVA of grid capacity from Indonesian state utility PLN and is planned to reach 640 MW of IT capacity across six buildings over roughly three years.
The first building is designed to provide 120 MW in phases, with the first contracted phase expected to enter service in early 2027.
BDx said the facility will use direct-to-chip liquid cooling designed to support rack densities of up to 500 kW and is being built for hyperscalers, AI cloud providers, technology companies, and enterprise customers.
The campus is located about five kilometers from Jatiluhur Dam. Before the stop order, BDx said it was also exploring lower-carbon energy options, including a possible hydroelectric power arrangement with state-owned water utility Perum Jasa Tirta II.
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Permitting could test Indonesia’s data-center buildout
The stop order highlights one of the less visible constraints on the global AI infrastructure boom.
Securing power, land, and financing is only part of bringing a large data center online. Operators must also clear building approvals, environmental reviews, and local requirements that can affect construction schedules.
Mulyadi said he supports investment in West Java as long as projects meet environmental requirements and has raised concerns about the effect large data centers could have on water resources.
That does not mean Indonesia is pulling back from data-center development. The immediate issue is narrower: BDx must complete the outstanding approvals before the project can move forward.
For customers and infrastructure providers watching Indonesia’s AI buildout, the next question is whether the permitting delay remains temporary or affects BDx’s plan to bring the first phase of CGK4 online in early 2027.
Other news: Southeast Asia’s AI boom is helping lift regional growth, but uneven infrastructure, skills, power availability, and investment conditions could determine which markets benefit most.