The INdonesia government's plan to provide a low-interest credit facility of 6 percent for a machinery modernization program has been welcomed positively by national textile and footwear industry players. The policy is considered a vital boost for labor-intensive industries to improve production efficiency, productivity, and competitiveness amidst the pressure of imported products and challenging global market conditions. The credit program will target the textile, footwear, and several other manufacturing industries through a financing scheme channeled by the Indonesian Export Financing Institution (LPEI).
The Chairman of the Advisory Board of the Indonesian Footwear Association (Aprisindo), Eddy Widjanarko, stated that the machinery restructuring program is the right step to strengthen the competitiveness of the national industry. According to him, machinery rejuvenation can help maintain a company's production efficiency amidst high operational cost pressures.
A similar sentiment was expressed by the Chairman of the Indonesian Fiber and Filament Yarn Producers Association (APSyFI), Redma Gita Wirawasta. He assessed that channeling credit through LPEI is the right decision because the institution has flexibility in financing regulations.
According to Redma, a credit interest rate of 6 percent is attractive enough to encourage the industry to modernize production machinery. However, investment decisions will still be influenced by competition conditions in the domestic market, particularly regarding the rampant influx of illegal imported products and dumping practices that still burden the domestic industry.
He emphasized that the main challenge for the textile industry today does not only stem from financing, but also from weak protection of the domestic market against the influx of cheap imported goods.
Meanwhile, the Chairperson of the Trade Division of the Indonesian Employers Association (Apindo), Anne Patricia Sutanto, assessed that machinery modernization has become an urgent need for the national textile and garment industry. In addition to increasing productivity and energy efficiency, technological updates are considered vital to improve product quality and strengthen export competitiveness.
Anne also highlighted that the textile industry is currently facing global demands regarding sustainability, decarbonization, and the implementation of Industry 4.0, which are increasingly becoming the focus of international buyers. She noted that the textile and garment sector remains one of the national strategic industries, with labor absorption reaching around 3.96 million people and an export value touching US$12.08 billion throughout 2025.
Nevertheless, industrial circles hope that the implementation of the credit program can be carried out quickly, be easily accessible, and be well-targeted so that the incentive truly provides a tangible impact for the business world.
Based on data from the Ministry of Industry of the Republic of Indonesia, industrial investment interest for machinery restructuring has reached around Rp847 billion. However, the allocation currently available for the program is only around Rp24 billion, leaving a substantial gap in financing needs.
Previously, Minister of Finance Purbaya Yudhi Sadewa stated that the government would provide low-interest credit facilities for the textile, footwear, and other manufacturing industries for the machinery rejuvenation program through LPEI. The government will also coordinate with the Ministry of Industry to map out companies that require machinery restructuring support and financing.
According to Purbaya, the private sector contributes around 90 percent to the national economy, meaning the government must continue to encourage business expansion through various incentives and ease of access to financing.