Jakarta. The government disbursed Rp 42.9 trillion in energy subsidies for fuel and 3-kg liquefied petroleum gas (LPG) gas canisters in the first half of 2024. Fuel subsidies amounted to Rp 8.7 trillion, while subsidies for 3 kg gas canisters totaled Rp 34.2 trillion.

Finance Minister Sri Mulyani Indrawati noted that the fuel subsidy covered 7.16 million kiloliters, with the 3 kg LPG subsidy totaling 3.36 million kiloliters.

"In the first half of 2024, fuel subsidies for 7.164 million kiloliters decreased by 0.05 percent from the same period last year, which was 7.167 million kiloliters. Meanwhile, the 3.36 million kiloliters of LPG represents a 1.4% increase from last year's volume of 3.31 million kiloliters," Sri Mulyani explained during a budget committee meeting with the House of Representatives on Monday.

Electricity subsidies reached 40.6 million houses in the first half of 2024, a 3.4 percent increase from the same period in 2023 when it stood at 39.2 million. Microcredit loans (KUR) disbursements rose by 34.4 percent, from Rp 105.2 trillion to Rp 141.3 trillion, with the number of borrowers increasing by 25.1 percent to 2.4 million people.

Overall, subsidies and compensations totaled Rp 155.7 trillion in the first half of 2024, down 3.8 percent from Rp 164.9 trillion during the same period last year. This figure excludes subsidies and compensations expected in the second half of 2024.

"Energy subsidies and compensations are influenced by fluctuations in crude oil prices, depreciation of the rupiah exchange rate, and increased volumes of subsidized LPG and electricity, which are expected to impact the second half of 2024," Sri Mulyani added.

An increase in non-energy subsidies in the second half of 2024 is anticipated due to an additional allocation of Rp 25 trillion for fertilizer subsidies. Furthermore, with higher volumes and more recipients of KUR, interest subsidies will also be evident in the latter half of 2024.