Heaptalk, Jakarta — President Prabowo Subianto has issued Presidential Regulation No. 46 of 2025, amending the previous Presidential Regulation No. 16 of 2018 on Government Procurement of Goods and Services. The revised regulation mandates that central and local governments, state-owned enterprises (SOEs), and regionally owned enterprises (ROEs) prioritize purchasing products with domestic content and those classified as domestically produced goods.
Industry Minister Agus Gumiwang Kartasasmita expressed appreciation for the revised regulation, stating it provides a breath of fresh air for industries facing weak domestic demand. “We, along with industrial players, highly appreciate President Prabowo Subianto for signing and enacting Presidential Regulation No. 46 of 2025. This regulation is a positive step for industries, especially those producing goods purchased by the government and SOEs/ROEs,” Agus said in Jakarta on Wednesday (05/07).
The revised regulation introduces a new clause in Article 66, specifying the priority order for government and SOE/ROE procurement. Under the new rules, products certified with domestic content or classified as domestically produced goods must be prioritized over imports.
This amendment improves upon the previous Presidential Regulation No. 16/2018, which allowed the government to directly purchase imports if domestic industries could not supply products with a combined domestic content score and company benefit weighting above 40%. The new regulation also clarifies procurement priorities for domestic content-certified and domestically produced goods, which were not clearly defined before.
Agus emphasized that the new regulation aligns with President Prabowo’s directive during an economic discussion at the Mandiri Building in mid-April 2025, when he called for domestic content policies to be relaxed and transformed into incentives. “This procurement regulation is in line with the President’s instruction to make domestic content policies more flexible and incentive-based,” Agus explained.
The minister clarified that Indonesia’s domestic content policy reforms began before former US President Donald Trump announced increased import tariffs in early April 2025. The Industry Ministry had already started discussions on revising domestic content calculation methods in January 2025.
“The domestic content reform was not triggered by reciprocal tariffs or global trade tensions but by the needs of Indonesia’s domestic industries. Long before the US tariff policy, we had already initiated efforts to reform domestic content policies—both in terms of fairer domestic content calculations and simplifying domestic content certification processes,” Agus stated.
The reform draft has undergone public consultation and is now in the finalization stage. “I hope this domestic content reform will further boost business and investment interest in Indonesia while increasing the manufacturing sector’s contribution to the national economy,” Agus concluded.
