Indonesia Packaged Water Market Outlook to 2028

Indonesia Packaged Water Market Overview

• In 2023, Indonesia's packaged water market reached a valuation of USD 300 million. This growth is driven by increasing consumer demand for clean and safe drinking water, a growing urban population, and rising health awareness. Bottled water has become a staple for urban residents, with more consumers shifting towards packaged water due to the declining trust in tap water quality.

• Indonesias packaged water market is dominated by several key players, including Aqua (owned by Danone), Club (from Indofood), and Nestl Pure Life. These brands maintain strong market presence through extensive distribution networks and aggressive marketing campaigns. Aqua holds the largest share of the market, benefiting from its long-standing reputation for quality and reliability, while Nestl and Indofood continue to expand through product innovation and sustainable packaging solutions to meet consumer preferences.
• In 2023, the Indonesian government launched the Clean Water for All initiative, aiming to improve access to clean drinking water across rural areas. This program, backed by the Ministry of Health and funded with over IDR 10 trillion, encourages public-private partnerships to develop water purification facilities. The initiative directly impacts the packaged water market, as it promotes higher standards of water safety, indirectly driving demand for bottled water in regions where infrastructure still lags behind.
• Jakarta, Surabaya, and Bandung are the top cities driving demand for packaged water in Indonesia. Jakarta alone accounts for most of the market demand, due to its dense population and high urbanization rate. Poor water infrastructure and heavy contamination of natural water sources further amplify demand in these cities, where consumers prefer bottled water as a reliable and safe option.

Indonesia Packaged Water Market Segmentation

• By Product Type: Indonesias packaged water market is segmented by product type into still water, sparkling water, and functional water. In 2023, still water dominates the market with over 70% of the market share, primarily due to its affordability and widespread availability. Consumers in Indonesia prefer still water for daily hydration, and key brands like Aqua have cemented their market leadership in this segment. Sparkling water and functional water are gaining traction among health-conscious consumers, but still water remains the most popular due to its practicality.

• By Packaging Type: The packaged water market in Europe is segmented by packaging type into three main categories: plastic bottles, glass bottles, and cans. Among these, plastic bottles dominate the market with an overwhelming 85% share as of 2023. Plastic bottles are the preferred choice for packaged water due to their affordability, lightweight design, and durability, making them convenient for transportation and storage. This high demand for plastic bottles is also driven by their widespread availability across various retail channels, from supermarkets to convenience stores, allowing consumers to easily purchase them on-the-go.

By Region: The packaged water market in Europe, segmented by region into East, West, North, and South, exhibits distinct trends across these areas. Western region leads the market with the highest consumption of packaged water, driven by countries like Germany and France, where sparkling water and bottled mineral water dominate. Southern Europe, including Italy and Spain, also sees strong demand for bottled water, largely due to cultural preferences for mineral-rich spring water.

Indonesia Packaged Water Competitive Landscape

1. Danone (Aqua) Developments
In 2023, Danones Aqua brand spearheaded efforts to reduce plastic use in Indonesia by introducing fully recycled plastic bottles. Aqua also launched a major campaign to promote water stewardship, working with local communities to improve water access and cleanliness. The brand plans to further expand its sustainability efforts by reducing water waste at its production facilities by 20% by 2025.

2. Indofood (Club) Developments
In 2024, Indofoods Club brand began transitioning to more sustainable packaging, replacing single-use plastic bottles with biodegradable materials. The company also entered into a strategic partnership with a local recycling company to ensure that over 70% of its packaging is collected and recycled. This initiative aligns with Indonesias larger sustainability goals, positioning Indofood as a key player in eco-conscious product development.

3. Nestl Pure Life Developments
In 2023, Nestl Pure Life launched a new product line of enhanced water fortified with minerals, targeting health-conscious consumers. The company also invested in a new production facility in Indonesia to increase its bottled water capacity by 25%. Nestls commitment to reducing its carbon footprint was highlighted by its shift towards using 100% renewable energy at its factories by the end of 2024, making it a leader in sustainable production.

Indonesia Packaged Water Analysis

Growth Drivers

• Increasing Demand for Safe Drinking Water
  In 2024, Indonesias packaged water market continues to see significant growth due to the country's ongoing issues with water contamination and inadequate public water infrastructure. According to the Indonesian Ministry of Health, 31 million people lack access to clean drinking water, particularly in rural areas, forcing many to turn to bottled water for daily consumption. As per 2023 data, urban households in cities like Jakarta and Surabaya heavily rely on bottled water, with over 80% of urban families preferring packaged water over tap water due to safety concerns.
• Tourism Industry Expansion
  Indonesia welcomed 16 million international tourists in 2023, a figure that is expected to increase due to major global events such as the 2025 ASEAN Games to be hosted in Jakarta and other cities. This influx is further supported by the governments Tourism Strategic Plan (2020-2025), which aims to boost foreign arrivals to 20 million by 2025, indirectly benefiting the packaged water market.
• Rising Health and Fitness Awareness
  In 2024, health-conscious consumers are significantly contributing to the growth of functional and mineral water products. According to a 2023 survey by the Indonesian Health Ministry, 60% of Indonesians stated they had increased their water consumption as part of their efforts to maintain a healthy lifestyle. The rise in demand for hydration-focused beverages such as electrolyte-rich bottled water is creating new opportunities for product diversification in the market.

Challenges

1. Environmental Concerns and Plastic Waste
   Indonesia generates over 3.2 million metric tons of plastic waste annually, according to a 2024 report from the Ministry of Environment and Forestry. The high reliance on plastic packaging in the bottled water market has drawn significant criticism due to its contribution to ocean pollution. As the government continues to tighten environmental regulations, with policies like the 2023 Single-Use Plastic Ban, bottled water companies face increasing pressure to adopt more sustainable practices.
2. Competition from Water Filtration Systems in Indonesia Packaged Water Market
   With advancements in water filtration technology, more Indonesian households are installing home water filters as a long-term alternative to buying bottled water. According to the 2023 data from Indonesia's National Agency for Water Supply, the number of households using water filtration systems in Indonesia's packaged water systemincreased by 35%, particularly in urban areas. This trend is diminishing the need for daily packaged water consumption .

Government Initiatives

1. National Action Plan on Marine Debris (2021-2025)
   Indonesia launched the National Action Plan on Marine Debris in 2021, which aims to reduce plastic waste leakage into the ocean by 70% by 2025. This initiative heavily influences the packaged water industry, as bottled water brands are under pressure to adopt sustainable practices, including biodegradable or recyclable packaging. The Indonesian Ministry of Maritime Affairs and Fisheries supports this initiative with a USD 1.2 billion budget allocated in 2023 for the development of waste management infrastructure, further pushing the industry towards eco-friendly solutions.
2. The 2023 Clean Water Initiative
   In 2023, the Indonesian government, through the Ministry of Public Works and Housing, introduced the Clean Water Initiative to improve access to safe and clean drinking water in underdeveloped rural areas. With a budget of IDR 8 trillion, the initiative includes the installation of water treatment facilities and aims to provide access to piped water for 5 million more citizens by 2025. This initiative could impact the bottled water market as improved access to clean water may reduce reliance on packaged water in the long term.

Indonesia Packaged Water Market Future Outlook

The future of Indonesias packaged water market appears promising, with projections indicating substantial growth driven by urbanization, tourism, and health trends over the next five years. Between 2024 and 2028, the market will likely see a shift towards more premium and eco-friendly products as consumers become more health-conscious and environmentally aware. The governments continued investments in clean water infrastructure will play a crucial role in shaping the market, particularly as regulations on plastic waste become stricter.

Future Trends

1. Sustainable Packaging Initiatives
   In the coming years, the Indonesian packaged water market will see a strong focus on sustainable packaging, with more companies investing in biodegradable and recyclable materials. This shift will be driven by both consumer demand and government regulations, prompting manufacturers to innovate in eco-friendly bottling solutions.
2. Expansion of Functional Water Products
   The next five years will witness the growth of functional water products enriched with vitamins, minerals, and electrolytes. These products will cater to Indonesias increasingly health-conscious population, particularly urban consumers focused on wellness and fitness. Companies will introduce more diversified offerings in this segment to capture niche markets.