Monday, 31 August 2015


In accordance with the directives of President Joko Widodo in the Limited Meeting (Rates) on local content (TKDN), Minister of Industry, Saleh Husin, urged so that steel used in infrastructure development projects should be produced in the country. “We’ve been able to produce quality steel with special specifications required by the industry. The factory locations are in Batam, Cilegon, and Bekasi, “he explained.

The use of domestic products is increasingly encouraged by the government, especially for infrastructure projects. Limited Meeting about local content (TKDN) in Infrastructure Projects discussed several things. For example, the background of the increased use of domestic products because there are many products that can be produced domestically.

“Firstly the gas transmission pipeline project from Gresik in East Java to Semarang, Central Java. Although the tender is won by Wijaya Karya consortium, but it is steel produced by South Korea, “said Industry Minister Saleh Husin. The gas pipeline project owned by PT Pertamina Gas (Prtagas) spans 270 km. While, the project construction is performed by state-owned contractors PT Wijaya Karya Tbk (WIKA), Remaja Bangun Kencana, and Kelsri.

The second topic is about the provision of power plant with a capacity of 35 thousand MW. Domestic component will be utilized more optimally, because the national industry is able to produce, among others, turbines, transformers, and transmission cable. The third topic is about the ability to finalize the fulfillment needs for heavy equipment for infrastructure projects. The goal is so that the national steel will be more absorbed in the country, and one sector which is able to revive the steel industry is, among others, heavy equipment industry, “said Saleh Husin.

The Limited Meeting revealed that the Ministry of Public Workers needs about 1,000 units of excavators. On the other hand, state-owned enterprise, PT Pindad, in addition to being a defense industry player, is also cultivating heavy equipment industry. “We will coordinate in this matter, weather with the Ministry of Public Works and PT Pindad. Currently, PT Pindad is preparing a protorype which is ready to be launched in June or July, “he added.

According to the Minister of Industry, President Jokowi has given directives so that the realization of increase of domestic products is accelerated. Other benefits for the government are that it saves foreign exchange, which previously flowed out of the country when import activity is still high. It is also for shake of the establishment of industrial structure from upstream to downstream, the spread of industrialization, and employment.

MoU of the Finance & Development Supervisory Agency

Currently, the Ministry of Industry is drafting a Memorandum of Understanding (MoU) with the Financial and Development Supervisory Agency (BPKP). The MoU is about audit of Local Content (TKDN) by BPKP on agencies and state-owned enterprises that use the state budget (APBN). “This audit serves to sharpen and accelerate the use of local content previously, we had several basic rules so that the use of domestic products can be further optimized, “he described.

The regulation include Law No. 3/2014 on Industry, chapters 85-89 on Increased Use of Domestic Products and Regulation of Minister of Industry No.02/M-IND/PER/1/2014 on Guidelines for increase of Domestic Products in the Procurement of Government Goods / Services. He said that it would perform an intensive coordination, particularly with the Ministry of Energy and Mineral Resources. The Limited Meeting expressed the need to revise Regulation of Minister of Energy and Mineral Resources No.15/2013 on the Use of Domestic Products In the Upstream Oil and Gas Business Activities. “The revision was an opportunity to increase local content in the oil & gas sector. In general, I am optimistic hat the directives of the President and coordination among ministries will become a momentum of independence of the national industry, “he concluded.

The energy sector became one of the mainstays of the Increased Use of Domestic Product (P3DN) program. A number of projects hat are in the upstream oil & gas sector, which is coordinated by Special Task Force for Upstream Oil & Gas Business Activities (SKK Migas) and conducted by Partnership Work Contract (K3S) under the coordination of the Ministry of Energy and Mineral Resources, as well as the construction of power plant and transmission, energy, State Electricity Company (PLN), and the National Gas Company (PGN) under the coordination of Ministry of State-Owned Enterprises. (E)

Business News - June 17, 2015 

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