TEMPO.CO, Jakarta - The latest import regulations are unfair and threaten domestic manufacturing industries. They are rife with power struggles.
THE administration of Prabowo Subianto has never issued import policies that can promote the development of domestic manufacturing industries. Regulations are not comprehensive and fail to resolve problems caused by competing interests among different ministries.
The government has just revoked Trade Minister Regulation No. 8/2024 on Import Policies and Regulations, which was issued in May 2024. Initially, this regulation was aimed at simplifying import procedures as well as protecting national industries from a deluge of imported products. But in practice it failed to achieve it: imported goods flooded in, causing huge problems for domestic industries.
As a replacement, the government released nine regulations at the end of June 2025. These comprise one general import regulation, namely Trade Minister Regulation No. 16/2025 on Import Policies and Regulations, as well as eight import regulations relating to different sectors. However, this move was unconvincing from the start, given that the government’s only reason for splitting up this regulation was to make it easier to make changes in the future.
And the proof of this is that these new regulations are unable to provide solutions to a number of long-term problems. The worst of these is that the new regulations state that technical considerations from the Industry Ministry are only necessary for permits relating to ready-made clothes (apparel). Meanwhile, other domestic products, such as electronics and telematics, are not protected because all importers have to do is hand over documentation from the surveyor, with no requirement to request technical considerations.
This discriminatory stance is suspicious, or at least shows that those drawing up the regulations do not have an understanding of the problems on the ground, because the domestic industries under threat from a flood of imports are not only textiles and garments but also other sectors. It is understandable that some suspect the discrimination in these new import regulations is a result of lobbying of a group of businesspeople to policymakers.
Previously, Industry Ministry technical considerations—or recommendations regarding imports in other sectors—were one way to limit the flood of imported goods. The aim is to protect the competitiveness of domestically produced goods from imported products.
The removal of this obligation for technical considerations not only makes it easier to import goods but also has the potential to lead to corruption. The monopoly on authority over imports concentrated in the Trade Ministry is an opportunity for rent seekers and crooked officials.
If illegal practices in the granting of import permits continue, the domestic manufacturing industry will sink further into the mire, while the domestic industry sector is already in trouble. The latest data from S&P Global shows that Indonesia’s Manufacturing Purchasing Managers Index—an economic indicator that measures the activity of the manufacturing sector—for June 2025 fell to 46.9 from 47.4 in the previous month. A figure of less than 50 shows that manufacturing in Indonesia is experiencing contraction.
If this situation continues, Prabowo’s hope that domestic industry will become the locomotive for Indonesian economic growth will have to be abandoned.
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