Jakarta. The government said Tuesday that it had made it easier for millions of Indonesian small and medium-scale industries to comply with the local content rule.

Indonesia requires producers to have a portion of their products to have domestically sourced components, a requirement that many businesses have found to be troublesome. According to Industry Minister Agus Gumiwang Kartasasmita, the 2025 ministerial regulation on the local content rule has simplified the processes for Indonesia’s small and medium producers, which amount to 4 million at present.

“These industries’ products are increasingly improving [in quality]. Their goods have also become more relevant to the needs of businesses and customers,” Agus told the Investor Daily Roundtable in Jakarta.

Under the new rule, small and medium-sized producers can self-declare the level of the local content on their products without the need to undergo a mandatory verification process. In the past, companies of such size had their local content capped at 40 percent, with the certificate only valid for three years. The new regime allows small producers to apply for a local content certificate of over 40 percent. The government has also extended the document’s validity to five years.

“There will still be verification or monitoring steps for these industries, but they are not mandatory,” Agus said, while saying that the government had waived the administrative fees for small and medium-sized industries.

Agus admitted that the government intended to have small and medium-sized industries to play a greater role in the national supply chain, including in government procurement. Indonesia also has an “e-catalogue” that facilitates the purchase of goods and services by government agencies. 

According to Agus, as many as 88,218 products that have been local content-certified are available on the platform. These products come from around 15,000 companies.

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