September 11, 2025 | 10:31 pm
TEMPO.CO, Jakarta - The Indonesian Minister of Industry, Agus Gumiwang Kartasasmita, will provide a 25 percent domestic component level (TKDN) for foreign investors who are willing to build factories and recruit local workers. "Automatically, they will get 25 percent. This is one of the points of ease of doing business, unlike before," said Agus during a press conference at the Ministry of Industry building on Thursday, September 11, 2025.
The policy is stated in the Minister of Industry Regulation No. 35 of 2025 concerning the Provisions and Procedures for TKDN Certification and Company Benefit Weights. He said that stakeholders have been involved in a trial run of the regulation, which is set to take effect on December 12, 2025.
He hopes that the rule changes will not only simplify the registration process but also enhance the competitiveness of the national industry, increase job opportunities, and ensure a preference for domestic products. Agus mentioned that entrepreneurs can obtain an additional TKDN value of up to 20 percent if they are willing to involve local talent in research, development, and brainware. The Golkar Party politician stated that this new regulation is the result of an evaluation of the Minister of Industry Regulation No. 16 of 2024.
Agus stated that Minister of Industry Regulation No. 16 of 2011 no longer meets the needs of an increasingly complex industry and does not provide convenience for industry players to participate in procurement projects for goods and services.
He explained that the TKDN regulatory reform includes thirteen relaxation points. In addition to offering a TKDN value incentive for domestic investment, Agus exempts entrepreneurs from selecting components that meet a 15 percent BMP value.
Agus also shortened the TKDN certification issuance time through independent verification agencies to 10 working days, while for small-scale entrepreneurs, it can be issued within three days.
He also provides an opportunity for small industries to make self-declarations of TKDN, which can be valid for up to five years. Agus stated that the Ministry of Industry will only conduct TKDN supervision once during that period.
Agus emphasized that entrepreneurs are not obligated to have TKDN certificates unless regulations require circulation permits. However, having the certificate can create opportunities for entrepreneurs who want to register their products in the e-catalog and participate in government procurement programs.
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