Jakarta. Textile giant Sri Rejeki Isman (Sritex) has temporarily furloughed 2,500 employees due to a raw material shortage, but they remain on the payroll despite the company’s bankruptcy status declared by the Semarang District Court.

Speaking at the Manpower Ministry's office in Jakarta on Wednesday, Sritex President Director Iwan Kurniawan Lukminto, confirmed that the company has not implemented any layoffs among its 50,000-strong workforce.

“Sritex has not laid off employees amid this bankruptcy. Around 2,500 employees have been furloughed due to a lack of raw materials,” he said

Iwan said that Sritex has sufficient raw materials to sustain operations for three more weeks. However, the shortage has been worsened by court-imposed restrictions on factory goods flow. If unresolved, the situation may force additional furloughs and could lead to layoffs.

He stressed Sritex’s commitment to paying salaries for furloughed employees and hopes that the business continuity process would be expedited to minimize further disruptions.

Deputy Manpower Minister Immanuel Ebenezer said that President Prabowo Subianto had instructed a coordinated 100-day rescue plan for Sritex across four ministries. “This demonstrates the government’s commitment to supporting the textile industry,” Immanuel said.

The think tank Celios attributed challenges in Indonesia’s textile industry to an influx of lower-priced Chinese imports, which have put pressure on local products. Iwan acknowledged that import relaxation policies have adversely affected the industry, with the Industry Ministry also citing such policies as contributing to declines in Indonesia's manufacturing sector.

The Trade Ministry, however, refused to take the blame, saying it had implemented quotas on imported apparel and imposed duties on foreign-made textiles. The government extended safeguard tariffs on textiles, carpets, and other fabric imports by three years to protect the sector from competition.

Meanwhile, several lawmakers are considering forming a special committee to investigate the recent bankruptcy ruling against Sritex. Members of the House Commission VII on Industry and the Creative Economy discussed the plan during a recent visit to Sritex’s factory in Sukoharjo, Central Java.

Sritex, known for supplying camouflage uniforms to NATO countries, also manufactures clothing for major brands like Zara and Uniqlo.