Government rolls out new incentives to modernise Indonesia's textile sector

At a ceremony in the Presidential Palace complex, officials outlined a package aimed at revitalising Indonesia's textile sector. The plan calls for local banks to provide loans for equipment upgrades and proposes reinstating tax holidays for manufacturers. A new special economic zone will be created to integrate upstream and downstream activities, and the government will evaluate current factories for conversion into a state-owned textile enterprise without building new plants.

Coordinating Economy Minister Airlangga Hartarto said import rules for raw materials will be loosened, while VAT and seasonal-employment rules for export-oriented firms will be reviewed. Industry leaders warned that without addressing outdated machinery and cheap imported clothing, the incentives may have limited effect. The initiative seeks to generate jobs and attract investment returns, according to Danantara CEO Rosan Roeslani.