In an impressive leap forward, industrial land development in Indonesia has surged by 130.02% over the past five years, significantly expanding the nation’s industrial landscape since the end of 2019, according to the Ministry of Industry (Kemenperin).
The latest records of industrial land development in Indonesia from Kemenperin reveal that 56 new industrial estate companies have been established, contributing an additional 43,296 hectares of land. Despite this growth, some industrial estates still face occupancy rates below 50%.
Minister of Industry Agus Gumiwang emphasized the need for rapid measures to address these low occupancy rates, suggesting a transformative approach towards fourth-generation industrial estates.
“Industrial estate companies are expected to implement smart digital infrastructure in their operations to support space and land management, service provision, and waste monitoring and management,” Agus stated in an official release on Friday, July 26, 2024.
Agus is advocating for the adoption of the Smart Eco Industrial Park concept, which leverages the latest environmentally friendly technologies. He also highlighted the importance of providing adequate infrastructure and supporting facilities to attract more investment and boost existing production capacities.
Furthermore, the government is urging managers to conduct a comprehensive remapping, particularly to enhance the supporting infrastructure in industrial areas, including energy needs for industries. This aligns with the government’s decision to continue the Specific Natural Gas Price (HGBT) program.
“The government is preparing a Draft Government Regulation (RPP) on the Use of Natural Gas for Domestic Needs to ensure a robust gas infrastructure in industrial estates,” Agus explained.
“One of the aspects to be regulated is the gas import scheme for use in industrial areas. Hopefully, this RPP can be completed soon.”
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As of July 2024, there are 156 industrial estate companies with Industrial Estate Business Permits (IUKI) operating across the country, encompassing a total land area of 76,594 hectares. Of this, 48,087 hectares, or 65.56%, have been filled by tenants or used for infrastructure, while 34.44% or 26,381 hectares remain available for investment.
The recent launch of PP No. 20 of 2024 on Industrial Zoning is expected to provide significant breakthroughs, supporting the growth of industrial estates in tune with contemporary dynamics. The regulation simplifies licensing, sets standards for industrial estates, and introduces mechanisms for supervision and control, particularly for Integrated Industrial Estates (KIT).
“We hope that with these regulatory supports, there will be no more industries built outside designated industrial estates,” Agus noted. “These adjustments are expected to serve as a reference for stakeholders in developing more integrated, effective, inclusive, and competitive industries.”
With these measures, the government aims to foster a robust industrial sector that not only attracts investments but also promotes sustainable and inclusive growth across the nation.
