Minister of Industry Agus Gumiwang Kartasasmita affirmed that the reform of the Domestic Component Level (TKDN) being carried out by the government is not a policy taken hastily or because of pressure from any particular party. The Minister made the statement to reaffirm that the TKDN policy reform is not caused by pressure from any country. In addition, the issuance of Presidential Regulation (Perpres) Number 46 of 2025 on Government Procurement of Goods and Services (PBJ) reaffirms the importance of the TKDN policy for domestic industry.
“We want to stress that the TKDN reform is not a knee-jerk reaction, not reactive and not due to pressure. We started it in February 2025, long before the recent developments,” Agus said in an official statement in Jakarta on Saturday (10/5).
The Minister of Industry added that the TKDN reform is part of the government's long-term efforts to strengthen national industry by increasing the use of domestic products. The policy is also in line with the President's direction to deepen the industrial structure and increase national competitiveness.
“The Ministry of Industry has carried out a thorough evaluation of TKDN implementation so far. This reform aims to make the policy more adaptive and transparent, and to deliver optimal benefits for domestic industry players,” he added.
Agus also stressed that the government will continue to involve various stakeholders in implementing the reform so that it is effective and well targeted.
Presidential Regulation Number 46 of 2025 is the legal basis that strengthens the new direction of TKDN policy, including improvements to the verification mechanism, incentives for industry players and stronger oversight to encourage commitment to using domestic products in various sectors.
With this step, the Ministry of Industry is optimistic that it can accelerate the self-reliance of national industry and strengthen the domestic manufacturing ecosystem.
Kemenperin and industrial companies also welcomed the four new sub-paragraphs in Article 66 of Presidential Regulation Number 46 of 2025, which govern the order of priority for spending by the government and state-owned and regional-owned enterprises (BUMN/BUMD). Under this new rule, the government prioritizes and is required to buy products with TKDN or domestic products (PDN) over imported products.
The order of priority for government spending on TKDN and PDN products under Article 66 of Presidential Regulation No. 46 of 2025 is as follows:
- If there are products whose combined TKDN and BMP (Company Benefit Weight) score is more than 40 percent, then what the government may buy through procurement (PBJ) are products with TKDN above 25 percent.
- If no product has a combined TKDN and BMP score above 40 percent, but there are products with a TKDN score above 25 percent, then products with a TKDN score above 25 percent may be bought by the government through Government Procurement.
- If no product has TKDN above 25 percent, the government may buy products with TKDN below 25 percent.
- If no product has TKDN certification, the government may buy PDN registered in the National Industrial Information System (SIINAS).
“This new regulation improves on the previous one, namely Presidential Regulation No. 12 of 2021 on Government Procurement. Imported products may not be bought through Government Procurement if the four spending priorities above can be met,” the Minister of Industry concluded.
Source: Press Release of the Ministry of Industry of the Republic of Indonesia