Amidst uncertain global dynamics, the Indonesian government is demonstrating an increasingly sharp and strategic direction for development. One effective strategy currently being focused on is the industrial downstreaming program—a concrete step that not only promises added economic value but also opens the door to more equitable prosperity in the regions.
In Central Kalimantan, support for downstreaming was expressed by the Chairperson of Commission II of the Central Kalimantan Regional People’s Representative Council (DPRD), Siti Nafsiah. She highlighted the regional economy’s dependence on the primary sector, and the government’s current push for a transformation toward an industrial-based economy for a more stable future. According to her, this condition makes the regional economy vulnerable to global price fluctuations and complicates long-term, sustainable development.
She believes that the raw material-based economic structure requires improvements to be more productive and sustainable, in line with the central government’s vision. Therefore, she emphasized the importance of shifting to downstreaming as a strategic step that must be implemented immediately.
Siti Nafsiah also revealed that the processing industry sector faces challenges, but the opportunity for recovery is significant with government support for downstreaming. In fact, this sector should be the main foundation for driving economic transformation and increasing the added value of superior regional commodities.
He stated that developing downstream industries for commodities such as palm oil, rubber, rattan, and other agricultural products is crucial so that processing can be carried out directly in the regions. This step is considered to increase competitiveness, create jobs, and strengthen local economic resilience.
Therefore, he urged the Central Kalimantan Provincial Government to immediately establish development policies that favor downstreaming. He stated that providing infrastructure, simplifying licensing, and technical training for local businesses are concrete steps that need to be prioritized. He believes that downstreaming is not merely an option, but a strategic need that must be addressed with integrated policies and concrete assistance.
Support for downstreaming does not come solely from the regions. At the national level, the Head of the Central Statistics Agency (BPS), Amalia Adininggar Widyasanti, also expressed a similar view. She stated that industrial downstreaming programs have proven effective in driving double-digit regional economic growth. She cited data from several provinces that have been touched by industrialization, which shows a surge in economic growth in a relatively short period.
Amalia added that the most tangible impact of downstreaming is seen in special economic zones (SEZs) and industrial estates across various regions. When a regional economic structure is strengthened by the industrial sector, the region’s economic resilience increases significantly. This is clear evidence that downstreaming is an effective measure with a direct impact on economic development.
She also stated that the success of downstreaming can serve as a reference for future national development strategies. She believes that equitable industrialization across regions is key to accelerating Indonesia’s overall economic growth.
Furthermore, Amalia assessed that the downstreaming policy aligns with President Prabowo Subianto’s target of driving national economic growth to 8 percent. She emphasized the importance of collaboration between the government, engineers, and industry players in supporting the acceleration of industrial transformation throughout Indonesia.
This perspective reinforces the belief that downstreaming is not merely a local strategy, but an integral part of the broader national development vision. The government has demonstrated a serious commitment to realizing reindustrialization as a foundation for strong and sustainable economic growth.
In Central Kalimantan, this opportunity must be addressed with concrete steps. Regional governments can develop a downstreaming roadmap based on local potential, such as the development of the palm oil, rubber, rattan, and agricultural industries. Integrated industrial areas close to raw material sources should be prioritized to reduce logistics costs and increase production efficiency.
Furthermore, local businesses, particularly MSMEs and cooperatives, need to be involved in the downstreaming ecosystem. Local businesses need to be actively involved as key partners in the national industrial value chain.
Downstreaming programs also have broad social impacts. When industry grows and jobs are created, community welfare will also improve. Rising incomes mean increased purchasing power, which in turn will stimulate other economic sectors such as trade, services, and tourism.
With the various benefits offered, downstreamingDownstreaming has proven to be a development strategy capable of boosting regional economies while strengthening the national foundation. The government has paved the way, and now it’s time for regions like Central Kalimantan to respond to this challenge with full readiness and a collaborative spirit.
Through downstreaming, Indonesia will not only export raw materials but also produce high-value-added products that can compete in the global market. This program symbolizes a major transformation in the direction of national development, from a commodity-based economy to an industrial-based economy.
With targeted steps, consistent policies, and full support from the central and regional governments, downstreaming will become a new engine of economic growth for Indonesia. The government is present, working effectively, and ready to guide regions to higher and more equitable levels of economic growth.
*) Strategic Issues Observer
