Points from Kemenperins Evaluations on TKDN for ICT Sector

The Ministry of Industry (Kementerian Perindustrian/Kemenperin) is evaluating a number of regulations related to the Domestic Component Level (Tingkat Komponen Dalam Negeri/TKDN) policy, particularly in the Information and Communication Technology (ICT) sector. The relaxation is being carried out as part of the government's negotiations on the reciprocal tariff policy set by US President Donald Trump.

“There are several TKDN policies that will be adjusted to domestic conditions. This is to avoid suppressing local production and resulting in an influx of imported products in the future,” said an unnamed Kemenperin official to Hukumonline.

One of the discussions is related to Regulation of the Minister of Industry No. 22 of 2020 on the Provisions and Procedures for Calculating the TKDN Value of Electronic and Telematics Products (“Regulation 22/2020”). This regulation is the technical implementation of Regulation of the Government No. 29 of 2018 on Industrial Empowerment (“Regulation 29/2018”) which aims to increase the use of domestic components in the ICT sector.

“The long-term and short-term effects are still being assessed, as they could also impact local tier-1 and tier-2 companies,” he added.