PravadaNews – The Indonesian government will implement an import duty exemption for LPG and plastic raw materials for six months. Initially, the import duty for LPG and plastic raw materials was 5% and it will be changed to 0%.
The policy aims to maintain domestic industry stability and prevent price surges due to global supply disruptions.
The Coordinating Minister for Economic Affairs, Airlangga Hartarto, stated that this policy is part of the acceleration of government programs to support economic growth enhancement, which is implemented through a special task force based on Presidential Decree Number 4 of 2026.
“In the context of accelerating government programs and also to support economic growth,” said Airlangga at the Lobby of the Ali Wardhana Building, Coordinating Ministry for Economic Affairs Building, Central Jakarta, on Tuesday (April 28, 2026).
Meanwhile, the National Coordinator of Publish What You Pay (PWYP) Indonesia, Aryanto Nugroho, assessed that the import duty exemption serves as a shortcut policy by the government.
“In the short term, the policy of reducing the import duty tariff from 5% to 0% is pragmatic and can be understood as an emergency measure (short-term fix),” Aryanto told PravadaNews on Friday (May 1).
Aryanto explained that the geopolitical situation in the Middle East, specifically the disruption of naphtha supply through the Strait of Hormuz, has triggered a raw material supply crisis for the national petrochemical industry.
“Without rapid intervention, the risk of rising prices for plastics and their derivative products could trigger inflation and disrupt people’s purchasing power,” explained Aryanto.
While the import duty exemption policy is only temporary, it will provide breathing room for refineries and the plastics industry to maintain economic growth amidst global pressures.
PWYP Indonesia emphasized that this policy should not be viewed as a long-term solution. “We consistently support a just energy transition. LPG is still a fossil fuel. Continuously providing fiscal incentives is tantamount to rolling out a ‘red carpet’ that prolongs Indonesia’s dependence on fossil energy imports,” said Aryanto.
Furthermore, Aryanto added, Indonesia has already been a net oil importer since 2008. “If it is not accompanied by a clear exit strategy, this policy actually contradicts our national and global commitments (Net Zero Emission),” concluded Aryanto.
Source: Pravada News