Monday, 13 July 2020 | 16:08 WIB

Ministry of Industry Eye Electronics Industry Investments of IDR 2.3 Trillion

Ministry of Industry Eye Electronics Industry Investments of IDR 2.3 Trillion (special)

JAKARTA, NETRALNEWS.COM - The Indonesia Ministry of Industry continues to increase investments in the electronics and telematics industry. The aim is to deepen its manufacturing structure domestically and also be a substitute for imported products.

"We focus on encouraging the domestic electronics and telematics industry to not only concentrate on assembly, but also to engage in value-added value chains," Director of the Industry and Telematics Industry of the Ministry of Industry Janu Suryanto said.

Janu said, in 2019, a number of semiconductor and electronic component manufacturers in Indonesia will invest their capital in expansion. They are, among others, PT Infineon Technologies Batam, which poured funds up to IDR 884 billion with a target of creating 1,000 jobs.

Furthermore, PT Rubycon Indonesia will invest IDR 89 billion by opening 250 jobs, and PT Excelitas Technologies Batam which will secure its capital of IDR 29 billion by absorbing a workforce of around 140 people.

"Then, this year it is projected that there will be a number of new investments that will enter, which in total value reaches IDR 1.3 trillion with a total employment target of 1,260 people. This indicates that the investment climate in Indonesia is still conducive, "he explained.

Janu said the investors included the semiconductor and electronic component industries, the household electrical appliances industry, the computer industry, electronic and optical goods, and the engineering equipment industry. They include PT Sammyung Precision Batam, PT Simatelex Manufactory Batam, PT Pegatron Technology Indonesia, and PT Siix Electronics Indonesia.

"We are optimistic, Indonesia will be able to build the ability of the local electronics industry which is globally competitive for advanced component manufacturing," he said. Moreover, based on the road map of Making Indonesia 4.0, the electronics industry is one of the five manufacturing sectors that have priority development to become pioneers in the application of industry 4.0 in the country.

"In an effort to spur the development of the electronics industry, in addition to making regulations to protect domestic industries, the government has also provided incentives to attract investment and encourage exports," he said. Tax incentives have been offered to investors, including tax holidays and tax allowances.

According to Janu, a tax holiday is given to investors who will develop the wafer semiconductor industry, the backlight industry for liquid crystal displays (LCD), electrical drivers and liquid crystal displays (LCD). This is in accordance with Minister of Finance Regulation Number 150 of 2018 concerning Provision of Corporate Income Tax Deduction Facilities.

Industry players can also use tax allowances, if they are interested in developing the computer industry, electronic and optical goods, electrical equipment industry and YTDL machinery and equipment industries (such as photocopying machines and refrigerators).

This is as stipulated in Minister of Industry Regulation No. 1 of 2018 on Criteria and/or Requirements in the Implementation of Utilization of Income Tax Facilities for Investment in Certain Business Sectors and/or in Certain Areas in the Industrial Sector.