Jakarta. Indonesia’s plan to cut gas exports to Singapore by 8% has drawn support from economists and policy experts, who say the move could strengthen domestic energy security and boost industrial competitiveness if the redirected supply is used effectively.

Robert R. Winerungan, an economist at Manado State University (Unima), said the government should prioritize gas supplies for domestic industries and power plants before meeting export demand, in line with President Prabowo Subianto’s push for energy self-sufficiency.

“The government’s decision is a sensible step toward meeting domestic needs and strengthening energy security. We should not keep exporting gas while domestic industries are struggling with energy shortages,” Robert said on Wednesday.

He argued that using gas domestically could generate greater economic benefits than selling it abroad. Affordable gas supplies could lower production costs, improve the competitiveness of Indonesian products and support value-added/downstream industries that produce higher-value goods.

“Using gas to meet domestic needs could actually be more economical. It would make our production processes more efficient and allow us to sell goods at lower prices. Our industries would also become stronger, enabling us to export finished products with greater added value,” he said.

Kristian Widya Wicaksono, a public policy expert at Parahyangan Catholic University (Unpar), said the policy was consistent with Article 33(3) of the 1945 Constitution, which stipulates that natural resources must be managed for the greatest benefit of the people. Article 8(1) of Law No. 22/2001 on Oil and Gas also prioritizes domestic utilization of natural gas, he said.

“From a public policy perspective, reducing gas exports to meet domestic demand should be seen as an effort to redirect natural resource utilization so that it generates greater economic benefits for Indonesians,” Kristian said.

However, Kristian cautioned that the government must ensure the redirected gas is used efficiently by domestic industries and power plants. The policy should be accompanied by adequate infrastructure, distribution networks and oversight to translate additional supplies into higher industrial productivity and job creation.

“The success of this policy should be measured by tangible benefits for the public, not simply by a reduction in export volumes. The government needs to announce measurable targets, such as more reliable electricity supplies, fewer disruptions to industrial production and broader access to energy,” he said.

Chief of Downstream Industry and Energy Minister Bahlil Lahadalia plans to reduce pipeline gas exports to Singapore by 31 billion British thermal units per day (BBtud), or around 8% of Indonesia’s total pipeline gas exports. Robert said the reduction was relatively small and unlikely to put significant pressure on Singapore’s economy.

Kristian said Indonesia could prioritize its domestic energy needs while maintaining legal certainty in trade, provided the government ensured that the policy complied with existing contractual obligations.

Bahlil has stressed that Indonesia would continue to honor its trade commitments with Singapore. Of the country’s total pipeline gas exports of 409.55 BBtud, the government would cut only 31 BBtud, or about 8%, which he said remained within the minimum supply limits stipulated in existing contracts.

“Under President Prabowo’s direction, Indonesia is a country that respects contracts and rules. No one needs to teach us about honoring our commitments and respecting contracts. The 31 BBtud reduction remains within the minimum contractual limits,” Bahlil said at a news conference at the Energy and Mineral Resources Ministry in Jakarta on Monday.

Bahlil attributed the reduction to two factors: maintenance shutdowns at production facilities and rising domestic energy demand. The government is prioritizing gas supplies for state-owned electricity company PLN’s power plants and national industries to keep economic activity running smoothly.

“First, there is maintenance, or a shutdown. Second, there is indeed domestic demand,” Bahlil said.

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