Report of the Joint Study Group on the Feasibility of India-Indonesia ...

25
The following boxes describe Indonesia’s policy and strategy to develop <strong>the</strong>se two sectors.
Box 3 : Indonesia -- Textile and Textile Products Industry
Background
In <strong>the</strong> framework <strong>of</strong> increasing <strong>the</strong> country’s Manufacturing Industrial Base over <strong>the</strong> medium-term, <strong>the</strong>
efforts undertaken include industrial restructuring and consolidation and improvement <strong>of</strong> efficiency and
international competitiveness. In long term, efforts will focus on improving <strong>the</strong> national capability in
research and development, technology and industrial design.
In improving <strong>the</strong> competitiveness <strong>of</strong> <strong>the</strong> national textile and textile products industry, <strong>the</strong> appropriate
approach in through <strong>the</strong> development <strong>of</strong> industrial clusters, taking into consideration <strong>the</strong> inter-linkages
between <strong>the</strong> up-stream and <strong>the</strong> down-stream industries. The up-stream, intermediate and down-stream
industries are usually agglomerated in certain areas so as to minimize <strong>the</strong> cost <strong>of</strong> transportation (lead-time
delivery),
Objectives
In <strong>the</strong> medium term <strong>the</strong> textile and textile product industry needs stronger supporting industries, especially
textile machineries and chemicals, through increased investments. In addition, efforts will be made to
develop Indonesian trademarks for export destination. The long term objective is to improve
competitiveness through specialization in high value added textile and textile products and high fashion,
including from various local materials.
Strategy and Policy
Measures will be taken to continuously improve <strong>the</strong> investment climate and access to financial resources
for players in <strong>the</strong> industry.
In addition, efforts will be taken to continuously increase <strong>the</strong> efficiency in energy use as well as energy
conservation and diversification.
Fur<strong>the</strong>rmore, <strong>the</strong> improvement <strong>of</strong> skills will be focused on design, merchandizing, marketing, as well as
processing technology and management. Efforts will also be made to streng<strong>the</strong>n <strong>the</strong> institutions for
certification and technical unit.
1. Specifically in <strong>the</strong> area <strong>of</strong> technology development, <strong>the</strong> restructuring and modernization <strong>of</strong> textile and
textile product machineries will focus on <strong>the</strong> development <strong>of</strong> environmentally-friendly manufacturing
technologies, streng<strong>the</strong>ning research and product development capabilities and institutions, developing
domestic fiber raw materials (PTA, MEG, Dissolving Pulp, cotton, jute, silk, etc).
Source: Ministry <strong>of</strong> Industry, Indonesia
Background
Box 4 : Indonesia -- Iron and Steel Industry
The steel industry is one <strong>of</strong> <strong>the</strong> strategic industries that are important for <strong>the</strong> development <strong>of</strong> infrastructure
and manufacturing industries. The national steel industry develops its competitive advantages by creating
specific steel products in response to <strong>the</strong> needs <strong>of</strong> <strong>the</strong> consumers. The priority is on <strong>the</strong> domestic market.
The steel industry has experienced a decline due to various factors such as <strong>the</strong> dependence on imported raw
materials, lack <strong>of</strong> supply <strong>of</strong> energy, illegal imports, environmental problems and changes in <strong>the</strong>
international market situation.