TEMPO.CO, Jakarta - Indonesia's Ministry of Industry said plans to revamp domestic component level (TKDN) are not dependent on U.S. products. "If we focus solely on the U.S., that would be considered discrimination," said the ministry's head of the public relations bureau, Alexandra Arri Cahyani, on Monday, July 28, 2025.
According to Alexandra, the TKDN reform will be outlined in the Minister of Industry Regulation. The ministry official hopes the TKDN will remain in place to maintain Indonesian products' competitiveness and to avoid a flood of imported products.
"We want our domestic products, or at least our domestic raw materials, to be competitive and be transformed into finished goods," she said.
In a joint statement issued by the White House, Indonesia and the U.S. are committed to addressing non-tariff barriers that affect bilateral trade and investment. "Including exempting U.S. companies and originating goods from local content requirements," the US government wrote on whitehouse.gov on Tuesday, July 22, 2025.
The statement also mentioned that Indonesia will eliminate 99 tariffs for U.S. industrial and agricultural products exported to Indonesia. In return, the U.S. will lower reciprocal tariffs from 32 to 19 percent for products imported from Indonesia. Certain commodities not available in the U.S. will be considered for lower tariff cuts.
Coordinating Minister for Economic Affairs Airlangga Hartarto ensures that not all U.S. products exported to Indonesia will be exempt from TKDN requirements.
Products exempted from TKDN requirements are communication and information technology (ICT) and medical devices. "(Exemption from TKDN) is limited to telecommunications, information and communication, data centers, and medical devices and still complies with import regulations implemented by the technical ministries," Airlangga said in a press conference at his office in Central Jakarta on Thursday, July 24, 2025.
Anastasya Lavenia Yudi contributed to the writing of this article
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