With a large population size that rapidly continues to grow, Indonesia needs to satisfy a growing demand for rice if it wants to prevent further rice price increases. Indonesian rice prices are already twice as high as on international markets and imports, while unpopular, are still necessary to cover shortages. Hybrid rice has the powerful potential to increase productivity. It has an average annual productivity of 7 tonnes/ha, compared to 5.15 tonnes/ha produced by inbred rice. However, hybrid rice only amounts to less than one percent of the rice planting area in Indonesia, and has stagnated for several years. Farmers generally find planting hybrid rice valuable. Farmers in Lombok experienced yields of 10.4 tonnes/ha compared to max. 8 tonnes/ha by inbred rice varieties. The additional yield brings about Rp 10 million additional annual net revenues per hectare. A lack of proper extension services, some problems of hybrid rice varieties, and unmet customer preferences have prevented the sustained adoption of hybrid rice by Indonesian farmers. Moreover, import restrictions limit farmers’ access to a continuous supply of seeds, which makes it less attractive for them to invest time and effort into the transition to hybrid rice. If hybrid rice is to reach levels like in China (51 percent of total rice acreage) and Pakistan (25-30 percent), it is important for the private sector to cooperate with the Indonesian government in developing and commercializing appropriate seed varieties. For the time being, imports remain important; not only to create sufficient supplies of seeds, but also to test whether certain hybrid rice varieties are suitable to local conditions in Indonesia. Once there are sufficient capacities to develop these varieties in Indonesia, the reliance on imports will naturally diminish. This depends to a significant extent on the available technical expertise in Indonesia. Hybrid rice development in Indonesia is currently constrained by the low number of experts who are able to develop new varieties. To sustainably replace seed imports, human development programs need to be done in cooperation with local universities. The establishment of research centers in different parts of the country allows for the development of varieties that suit particular consumer preferences as well as climate and soil conditions in different parts of the country.