Jakarta. The Indonesian government is deliberating a major shift in trade policy following President Prabowo Subianto’s proposal to remove import quotas on key commodities, just as the United States imposed a 32 percent reciprocal tariff on Indonesian goods.

The proposed reform has sparked debate among ministries and lawmakers, with critics warning of potential risks to domestic producers.

Secretary General of the Trade Ministry, Isy Karim, said on Wednesday that the current import quota mechanism—particularly for strategic commodities such as rice, sugar, beef, and salt—is governed by the Commodity Balance Sheet (NK), as mandated under Presidential Regulation No. 32/2022. Any changes to this system, he said, would require approval at the Coordinating Minister level.

“The technical aspects of implementing this change haven’t been discussed yet. The final decision lies with the Coordinating Ministry,” Isy told reporters at the Trade Ministry office in Jakarta.

He explained that while the NK regulates strategic goods, it does not cover intermediate materials used in production. This, he said, underscores the need for a broader inter-ministerial review to assess the implications of the policy shift.

“The definition of a quota covers many areas, so the discussion needs to be expanded,” Isy added.

Earlier, President Prabowo urged Agriculture Minister Amran Sulaiman and Trade Minister Budi Santoso to eliminate import quotas for essential goods that impact the wider population—citing beef as an example. According to Prabowo, removing quotas would streamline trade and improve domestic supply chains.

In a related move aimed at boosting investor confidence, Prabowo also signaled a more flexible stance on Indonesia’s local content requirements. Under current regulations, manufacturers are required to source a portion of their components domestically --a policy that was tightened during former President Joko Widodo’s administration. For instance, all 4G-enabled devices sold in Indonesia must have at least 35 percent local content, with plans to increase the threshold to 40 percent. This policy had previously hindered Apple’s entry into the market, but regulators have now approved the iPhone 16 for sale starting Friday.

Speaking to business leaders and economists in Jakarta last week --just days after US President Donald Trump introduced sweeping reciprocal tariff-- Prabowo reiterated his nationalist stance but said policies must also support the ease of doing business.

Meanwhile, Deputy Chair of House Commission XI, M. Hanif Dhakiri, cautioned against a rushed liberalization of imports. He stressed that any removal of quotas must be accompanied by safeguards to protect local producers from a potential flood of cheap imported goods.

“Free markets must be fair,” Hanif said. “We cannot allow domestic producers, especially those supplying essential goods, to be edged out by a surge of low-cost imports.”

On April 9, President Trump announced a 90-day delay in the implementation of his reciprocal tariff measures that had triggered global concern. Indonesia is still expected to face a 32 percent tariff, which should have took effect early Wednesday.

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