**1. Introduction**

The services sector is being globalized through such processes as outsourcing and international consolidation. The services sector accounts for a growing share of output and jobs across the OECD [1]. At the same time, international trade and investment in the services sector have increased [1]. Global corporations dominate service industries such as accounting, the media, publishing, finance, communications, and logistics. As a service industry education is also undergoing a process of globalization. In the higher education sector, there are universities with global

reputations (Harvard, MIT, Cambridge, Oxford) and multinational publishing houses that provide integrated courses to universities and students globally and dominate the publishing of academic journals. The process of globalization is supported by technological developments associated with the Fourth Industrial Revolution that "*concerns the digital transformation in society and business - an interface between technologies in the physical, digital and biological disciplines….Emerging technology such as artificial intelligence, robotics, the Internet of Things, autonomous vehicles, 3-D printing, nanotechnology, biotechnology, materials science, energy storage, and quantum computing, represent just the tip of this technology iceberg" ([2]*, 2). Globalized universities can have a local presence, without a physical campus, *via* online courses. Enrolments in online learning programs are expanding exponentially, placing pressure on traditional university systems [3]. In the age of the Fourth Industrial Revolution, globalization is occurring without being accompanied by foreign direct investment and presence in the countries from which students are enrolled. In addition, technology is transforming teaching and learning processes and supporting sophisticated research programs *via* such processes as artificial intelligence, cloud data storage, big data analysis, biotechnology, and machine learning [2].

In this chapter, the discussion is on internationalization, a separate, but related process to globalization. The focus of internationalization is on developing an international component into these core functions—teaching, research, and engagement. Globalization refers to trade, investment, and integration of the sector across countries and has an industry focus. With respect to the higher education (HE), sector internationalization encompasses many dimensions and processes. These include the curriculum, students, staff, research, governance, and reputation. Within this chapter, the nature of internationalization in the context of the Indonesian HE system is mapped and the opportunities and challenges to internationalizing the sector are discussed. As with other emerging economies, there is a national goal to increase access to education and to develop human capability through increased participation in post-secondary education [4]. This is a global aspirational goal linked to improving living standards and the quality of life [5]. To pursue this process requires a HE sector that provides access to those seeking post-secondary education, relevant programs that are linked to national and personal goals, and quality education that ensures graduate employability and supports growth and productivity [6]. To this end, internationalization is a process in HE that supports the qualitative improvement in programs and contributes to broader national and personal development objectives.

For all countries, investment and quality higher education systems are important as they contribute to human capital development, the alleviation of poverty, the productivity of industry, innovation, and development, and core skill development [7]. For individuals and nations, the returns from investment in the HE sector are significant [7]. Investing in HE remains an important step toward achieving many development goals:

*Economic research unequivocally illustrates high private and social rates of return for investments in tertiary education, including research. The benefits include higher employment and earnings, productivity growth and innovation, greater social stability, more effective public sector bureaucracies, increased civic engagement, and better health outcomes. The consequences of underinvestment in tertiary education include talent loss, limited access to applied research capacity for local problem solving, hindered economic growth due to low levels of skills in the workforce,* 

*Challenges and Opportunities to Internationalize the Indonesian Higher Education Sector DOI: http://dx.doi.org/10.5772/intechopen.110658*

*low-quality teaching and learning at every level of education, and, perhaps most glaringly, expanded wealth inequality both within countries and among nations, with those investing proportionately more experiencing more innovation and attraction of investment. ([7], p. 2).*

Making progress toward the UN sustainable development goals, especially reducing poverty, improving living standards, and improving equity requires a significant investment in HE [8]. For this reason, it is important for a country like Indonesia to not only invest in the HE sector but ensure that the sector is efficient and effective [9]. To this end, examining internationalization is an important part of supporting the qualitative development of the HE sector.

In this chapter the internationalization of the Indonesian HE sector is evaluated in terms of the progress toward internationalization, the barriers faced, and the programs and policies in place to support internationalization. To address these issues, the chapter draws on secondary sources through academic literature and from reports by national and international agencies. The chapter is organized as follows. First, an outline of the Indonesia HE sector is provided. Then, there follows an examination of the process of internationalization of the HE sector. Following is a discussion of the evidence on the standing and progress toward internationalization of the Indonesian HE sector. The challenges for realizing internationalization in Indonesia are outlined. This is followed by an assessment of current programs to support internationalization. Finally, the chapter reflects on the key processes that are required to support the internationalization of the Indonesian HE sector.
