JAKARTA - Weeks ago, an Indonesian in England held up a letter from the UK Home Office and filmed herself reacting to it as her second child officially became a British citizen.
In a caption that accompanied the video, she wrote what she felt, “I know the world seems unfair. But it's enough that I’m [the only] Indonesian citizen, not my children.” The words spread like wildfire, and within days, Dwi Sasetyaningtyas (known online simply as Tyas) had a target on her back from Indonesia’s top-ranking ministers to internet citizens.
The outrage was loud, so loud that the halls of Jakarta’s ministries heard it. Tyas and her husband, Arya Iwantoro, were both recipients of Indonesia’s most prestigious state scholarship program, both funded by public money to study abroad.
Arya had completed a PhD in physical geography at Utrecht University in 2022, financed through the Lembaga Pengelola Dana Pendidikan, or LPDP. He was now working in England as a senior research consultant, and according to LPDP’s own public statement in February 2026, he had allegedly never returned to fulfill his post-study service obligation back home.
Tyas then deleted the video following the public outcry. She issued an apology and said the words had come from exhaustion, from a private grief about Indonesia she had not intended to make so public.
Then, Indonesia’s Finance Minister Purbaya Yudhi Sadewa went on record at a press conference, confirmed that the state had spoken with Arya, and announced that Arya had agreed to return the scholarship funds with interest. Both were placed on a permanent government blacklist. LPDP, for its part, said it was investigating more than 600 other awardees for similar service violations.
But the very system designed to fund Indonesia’s brightest minds and bring them home has a structural problem, and it goes well beyond one couple in England trying to find loopholes in Indonesia’s bureaucracy.
LPDP in Structure
The “Lembaga Pengelola Dana Pendidikan”, or the Indonesia Endowment Fund for Education Agency, was established in 2010 and began awarding scholarships in 2013. It sits under the Ministry of Finance and draws from the National Education Development Fund, a dedicated endowment seeded by the state budget but managed separately from it.
By August 2025, the endowment principal had reached Rp154.11 trillion, with total managed assets growing to Rp180.8 trillion by the end of the year. As of the end of 2025, LPDP had funded 58,444 recipients in total since the program launched. The scholarship covers postgraduate study at accredited universities within Indonesia and abroad.
And for those studying overseas, the financial package is massive. Tuition fees are covered in full, paid directly to the university wherever possible, and recipients also receive a monthly living stipend calibrated to where they are studying. Online reports suggest monthly stipends of up to USD 2,600 per month in the United States, GBP 1,600 in the United Kingdom, and AUD 2,800 in Australia.
On top of that, there is an annual book allowance of Rp10 million, research grants for theses and dissertations, international conference grants, publication incentives for peer-reviewed journals, health insurance, and a lump-sum arrival allowance at the start of studies with flight tickets being covered as well. Doctoral recipients who relocate their families receive an additional allowance for up to two dependents, each getting 25 percent of the monthly stipend.
So by any standard, LPDP is a generous package. But it also comes with a binding legal contract of service requirement.
Under the rules that applied from the scholarship’s founding through 2024, awardees were required to return to Indonesia within 90 days of their graduation date and serve for a period defined by the 2N+1 formula. N is the length of study, which means that the longer the state invested in them, the longer they owed their expertise back in Indonesia. Starting in 2025, LPDP adjusted its service obligation to 2N rather than 2N+1, dropping the additional year.
The formula was calibrated against the idea that the benefit a graduate could theoretically generate for a host country’s economy should be redirected toward Indonesia instead. The formula gave the state a proportional return on its investment, and the extra year served as a buffer, so a graduate could not simply complete the minimum and leave.
LPDP defined “contribution” in terms of professional work, active research, or community service in sectors like science, technology, health, economics, and social welfare among others, with mandatory physical presence in Indonesia. Periodically, they would also have to report their status through the official E-Beasiswa app.
Those who wanted to pursue further study or take up short-term work abroad during their service period had to apply for formal written permission from LPDP, with documentation proving the relevance of the activity and a guaranteed return date.
Graduates can work overseas only with LPDP approval for up to 24 months, limited to specific categories such as government postings, BUMN assignments, international organizations (such as the World Bank, for example), or Indonesian companies sending staff abroad. Afterward, they must return within 90 days, and the time spent abroad does not count toward their service obligation.
But the enforcement itself, for much of the scholarship’s first decade, was largely inconsistent. In 2023, LPDP’s own data showed that out of 35,536 awardees assessed, 413 had not returned to Indonesia. The state has invested a fortune on them, but why wouldn’t they want to return?
A Systematic Issue
The online outrage and the public angle are too simple to be boxed into a passport matter. That’s just the spark, because Indonesia’s labor market has a graduate problem that predates LPDP by decades.
In February 2025, BPS recorded 1,010,652 unemployed university graduates across the country, people with diplomas, bachelor’s, master’s, and doctoral degrees who could not find work. It was the highest number in three years, and the fastest-growing unemployment segment in the country. While unemployment rates for SMA (high school) and SMK (vocational school) graduates were falling at the time, the rate for university graduates climbed to 6.23 percent.
An LPDP awardee, who shall not be ID’ed to protect their identity, agreed to an interview with Migrant Times. They were among those who chose not to return to Indonesia after graduation because the infrastructure for his expertise is simply barred from growth due to Indonesia’s own bureaucracy.
“I really want to return. I really do, and I’m lucky that money was never an issue for me. LPDP gave me access to something I would’ve never dreamed of in my wildest dreams,” the graduate mentioned. “I’ve received an offer for research [exactly in my field], but there was just so much sectoral ego and a research culture that is very administratively oriented.”
“I wouldn’t be able to do my job properly due to the rigid bureaucratic regulations, so I decided [to stay]. But I hope that with me being here, I could push [the envelope] little by little for Indonesian graduates to be recognized, just like China and India.”
Tri Handoko Doki, who handles research and development at the Talent and HR Directorate of the Overseas Indonesian Students’ Association Alliance (OISAA/PPI Dunia), has observed this pattern for years.
Tri is now completing a Doctor of Education at the University of Bristol. Before that, he earned a master’s degree from the University of Toronto and returned to Indonesia before heading abroad again for further study. The problem he kept seeing was that coming home meant starting over in ways that had little to do with their expertise.
“This usually has something to do with the salary expectation gap,” he said. “When we study abroad and return to Indonesia, we expect a certain salary, but in reality, when we return to Indonesia, the salary for the expertise we have isn't that high.”
Then there’s the structural problem. Tri points to a mismatch in the labor market where many graduates return with specialized skills from overseas, but there are few clear career paths for them in Indonesia. Years spent studying abroad also mean that they miss out on building local professional networks, and in Indonesia’s job market, this is the culture that carries enormous weight in hiring.
“The time, which in Indonesia could be used for studying and networking, goes unused because we’re studying and networking abroad,” he said.
“So the problems they face tend to be the same. It doesn’t really matter whether they studied on an LPDP scholarship, another scholarship, or even paid for it themselves. When they return to Indonesia, they still need professional connections.”
Then, there is also a prestige hierarchy that works against graduates from anywhere that is not a top-ranked institution. It’s the very same pattern that has existed even for graduates of Indonesian universities, as Tri describes it plainly. Employers ask whether a candidate graduated from Harvard or Oxford, and if not, they move on. A degree from a well-regarded university outside the global top ten is frequently treated as equivalent to a local degree, regardless of what the graduate actually studied or produced.
“It’s a bias that the Top 10 in the world will get more respect,” he said. “Whereas those outside the Top 10 are like, ‘Oh well, I’ll just skip them.’”
Tri was careful to note that the problems he describes are not unique to LPDP awardees. Every Indonesian graduate who studied overseas faces the same salary expectations gap, the same network deficit, the same institutional mismatch. This is not to say that the scholarship was the problem, but the stakes of coming home are definitely higher and more visible.
A Much Needed Evaluation
The first thing Finance Minister Purbaya said publicly about the LPDP controversy was about money. At the APBN KiTa press conference on February 23, he said the fund that pays for everything comes from tax revenue and a portion of state debt. It is not a gift, and not a prize, but an investment that’s drawn from public money, with an expected return.
That framing has a logic to it because LPDP, on paper, is a state project for human investment and the awardees know what they sign up for. As they really should. But at the very same time, it also places the entire weight of a structural failure on individual recipients. And Indonesia is far from the only country that has tried to build this kind of system, and run into the same wall.
Kazakhstan’s Bolashak scholarship has been running since 1993, funded by the government to send promising graduates to leading universities abroad on the condition that they return and work in Kazakhstan for five years. To enforce that, the program requires awardees to pledge real estate as collateral and nominate up to two guarantors who become financially liable if the graduate does not come back.
When one graduate, Valeria Gavrilenko, completed a master’s at the University of Liverpool and stayed in the UK, the real estate she had pledged was released by a corrupt Center official in 2019 before her obligation was cleared. Her two guarantors were left holding the full debt, and by 2024, Kazakhstan’s Center for International Programs was still pursuing the case.
China’s scholarship system through the China Scholarship Council follows a similar architecture. The CSC’s largest study abroad program funds more than 10,000 Chinese PhD students abroad each year, primarily in STEM fields, with a stated expectation that they return to work in China after completing their degrees.
But in practice, the program has struggled to hold graduates. According to research by Georgetown University’s Center for Security and Emerging Technology, more than 85 percent of Chinese STEM PhD students in the United States intend to stay in the country after graduation, regardless of CSC funding.
Vietnam’s Project 911 targeted university lecturers, funding doctoral training abroad on the understanding they would return to teach at public institutions. But many actually didn’t, or returned and moved to private sector work within months. Public university lecturer salaries at the time ran as low as the equivalent of USD 200 a month, and foreign doctorate didn’t really change that number.
Saudi Arabia’s KASP program, restructured under Vision 2030’s Human Capability Development Program, shows what a different approach looks like. The Saudi state actually created demand for what graduates came home with. NEOM and related megaprojects required the engineers, planners, and economists that KASP had trained.
The problem in Kazakhstan, China, and Vietnam is that the state built what is actually a feasible scholarship program without building the ecosystem around it.
LPDP is now trying to overcome that, or at least on paper. Sudarto, the President Director of LPDP, confirmed in February 2026 that the institution is in active discussions with BPI Danantara on structured alumni placement in strategic sectors through pro hire schemes, with several banking partnerships already operational.
The institutional language has also changed from education-centric to impact-driven, a paradigm change Sudarto announced formally at the opening of LPDP 2026 scholarships in January.
Tri, speaking from Bristol, thinks the answer requires something a lot more fundamental than job placement deals. What he describes is a platform where graduates approaching the end of their service window abroad can connect with the Indonesian job market, receive structured preparation for reverse culture shock, and land somewhere specific rather than scatter back into an economy that may not have been waiting for them.
The “contribution” measurement problem sits underneath all of this. As Tri points out, LPDP’s definition of successful service contribution has always been, at its core, administrative. Graduates have to physically show up, report in, and work in an approved sector.
What that contribution actually produced (what changed, what was built, what problems were solved) is not systematically measured. “The contribution is bigger than just written down, like oh 2N+1, oh 4 years, oh 5 years,” he said.
“It’s actually bigger than that.”
In LPDP’s framing, the Arya Iwantoro case is a compliance failure because someone signed a contract and did not honor it, and it is also a mirror of a system that produced a coastal geomorphologist who built a research career in England and somewhere along the way calculated that going home was not worth it.
Minister Purbaya was right to call it out. Rightfully so. But while enforcement can recover funds, it cannot recover the years, the work, or the answer to why an investment program built on public money was never properly cooked to begin with. And solving that, as Tri suggests, isn’t the worst place to start.
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