Realizing the President’s Aspirations Through Downstreaming for Indonesian Industrial Independence

By: Naura Astika )*
Indonesia, with its abundant natural resources, has great potential to become a strong and independent industrial country. However, so far, much of this natural wealth has only been exported in the form of raw materials without any significant added value. This causes Indonesia to often only be a consumer country rather than a producer country with higher value-added products.
Under the leadership of President Prabowo Subianto, Indonesia is focusing on reducing dependence on raw material exports and increasing the processing industry through downstreaming. This policy is key to realizing the President’s Asta Cita to make Indonesia more independent, competitive, and have high added value.
Downstreaming refers to the process of processing raw materials into finished goods or at least semi-finished goods that have higher added value. This is very important so that Indonesia does not only depend on raw material exports, but is able to create more valuable products and compete in the global market.
Senior Research Advisor Knight Frank Indonesia, Syarifah Syaukat said that the downstreaming policy implemented by the government can have a positive impact on industrial and warehousing areas. Because when the A to Z process is in the manufacturing sector, the party feels that this added value not only provides added value to the product but also provides positive value to the overall performance of the industrial area market.
One of the positive impacts of this downstream policy is the change in the industrial sector in the Greater Jakarta area. This area, which was previously known as a labor-intensive industrial sector, is now shifting towards a high-tech industry. Therefore, the downstream policy implemented by the government will certainly be supported by infrastructure development. The government also focuses on building and improving infrastructure in industrial and warehousing areas. This is expected to encourage investment and open up new opportunities in the development of the industrial sector.
With domestic processing, Indonesia can not only create more jobs, but can also increase the competitiveness of the industry in the global market. Downstreaming will reduce Indonesia’s dependence on imports of manufactured goods, which are often more expensive and less affordable for most people. The downstream process will accelerate the creation of an industry that can compete with other countries in terms of quality, efficiency, and price.
Minister of Energy and Mineral Resources (ESDM), Bahlil Lahadalia said that downstream projects cover various strategic sectors, one of the main projects in industrial downstreaming is the construction of an oil storage project on Nipah Island.
This project aims to increase national energy security by strengthening the capacity of crude oil storage domestically. With domestic processing, Indonesia can expand employment opportunities, increase industrial competitiveness, and reduce dependence on imports of manufactured goods.
Downstreaming is the process of processing raw materials into finished goods or at least semi-finished goods that have higher added value. In the industrial sector, downstreaming plays an important role in transforming Indonesia from a country that only relies on exports of raw materials into an industrial country that is able to produce products with higher added value.
Minister of Investment and Downstreaming Rosan Roeslani said that the government continues to encourage investment in more mature downstream projects. The downstreaming of this downstream project is also directed to be in line with the government’s target of achieving net zero emissions (NZE) by 2060 in order to be in accordance with the industrialization that we want to achieve so that these projects become sustainable projects and at the same time, their emissions become better.
To realize successful downstreaming, investment is an important factor that must be encouraged. President Prabowo Subianto has firmly directed policies to attract foreign and domestic investment in the industrial sector, including the natural product processing industry. Several policies that have been taken by the government, such as ease of licensing, simplification of regulations, and provision of fiscal incentives, aim to create a more conducive investment climate.
The success of downstreaming is highly dependent on the entry of the right investment. With investment, the industrial sector will grow rapidly, and more value-added products will be produced. This investment also opens up opportunities for the development of more competent human resources in the fields of technology, engineering, and industrial management. This will help Indonesia to have a more skilled and professional workforce, which is an important foundation for the progress of the national industry.
Downstreaming is a stepstrategic that not only supports the government’s efforts in realizing President Jokowi’s great ideals for economic independence, but also plays an important role in creating jobs, increasing industrial competitiveness, and optimizing the potential of Indonesia’s natural resources. Investments that enter the downstream sector will accelerate the processing of raw materials, create value-added products, and ultimately strengthen the Indonesian economy.
With the right policies, investment support, and improving the quality of human resources and infrastructure, Indonesia can realize a more independent and highly competitive industry. Downstreaming is not only an effort to improve the economy, but also the key to opening the door to a more advanced, independent, and prosperous Indonesia.
)* The author is a Public Policy Observer