Ministry of Industry Prepares Financing Regulation for Industrial Decarbonization

The Ministry of Industry (“ Kemenperin ”) is currently preparing strategic measures to reduce emissions in the industrial sector through the establishment of financing regulations and the formation of the Industrial Decarbonization and Competitiveness Fund (“ IDCF ”). Apit Pria Nugraha, Head of the Center for Green Industry at Kemenperin, stated that regulation is necessary to ensure that industry actors remain committed to reducing emissions, given that not all companies are willing to invest in low-carbon technologies without policy-driven incentives.

“Going forward, we must establish new regulations, as many industries are still reluctant to reduce their emissions. Meanwhile, emission reduction targets—both for the Nationally Determined Contribution (NDC) and for achieving net zero emissions—must be met,” said Apit.

To that end, Kemenperin is currently designing the IDCF as a national financing scheme based on blended financing, specifically dedicated to decarbonizing the industrial sector.

“We will establish the IDCF as a national fund dedicated solely to industrial decarbonization,” he explained.

This scheme is expected to bridge the financing gap faced by small and medium-sized industries that struggle to access large-scale green financing from international institutions. The IDCF will be integrated with the Green Industry Service Company (“ Gizco ”) initiative to connect financing providers with industrial actors undertaking decarbonization projects.