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View all search resultsCo-op vehicle imports from India will 'kill' local industry, businesses warn
House of Representatives Deputy Speaker Sufmi Dasco Ahmad stated that he had conveyed a message to the government to temporarily delay the import plan.
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A man walks past a Tata Motors dealership on Wednesday in the Kramat area of Central Jakarta. Indonesia has decided to import 105,000 cars from India through the Red and White Rural Cooperatives (KDMP) program. (JP/Iqro Rinaldi)
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ocal businesses have slammed the government’s plan to import 105,000 commercial vehicles from India, worth around Rp 24.66 trillion (US$1.46 billion), for the Red and White Rural Cooperatives (KDMP) program, urging it to scrap the proposal. They argue that domestic manufacturers are fully capable of meeting the demand, warning that proceeding with the imports could further strain an already weakened auto sector.
The Indonesian Employers Association (Apindo) said the plan should be comprehensively reevaluate, given its scale and strategic implications for the national automotive industry, which is currently grappling with weakening domestic demand.
“Procurement [of vehicles] must be truly based on real operational needs in villages and carefully consider the strategic consequences for the national industry, especially the automotive sector,” Apindo chairwoman Shinta Kamdani told The Jakarta Post on Monday.
She said industry data showed that national production capacity for pick-up vehicles reached between 400,000 and 1 million units per year, with most locally produced models already meeting domestic component requirements (TKDN) of above 40 percent.
However, this capacity had remained underutilized in recent years because of sluggish market conditions.
“As long as production capacity and capability are available domestically, the procurement scheme should prioritize optimizing the national industry and providing sufficient time for domestic producers to meet the required volume, specifications and criteria,” she said.
According to Shinta, such an approach would generate a stronger multiplier effect for the domestic automotive ecosystem, including higher factory utilization, stronger component manufacturing and stable employment absorption along the supply chain, which employs around 1.5 million workers nationwide.
