The Minister Of Industry Asks For Indonesian Manufacturing To Be Diversified To Energy Sources Impact Of The Iran-Israel War

JAKARTA - Minister of Industry (Menperin) Agus Gumiwang Kartasasmita reminded the Indonesian manufacturing industry to anticipate the impact of the Iran-Israel war.

Mainly for the dependence of the domestic industry on the energy of imports as raw material and production input components.

"Domestic industries are asked to be more efficient in using energy in the production process. The use of energy is more efficient than various sources, which can increase productivity and competitiveness of industrial products," Agus said as quoted from his written statement, Wednesday, June 18.

Agus also encouraged industry players to diversify energy sources used in production.

This is crucial considering that dependence on the energy of imported fossils from the Middle East will be affected by the ongoing geopolitical conflict.

"The national industry must start relying on domestic energy sources, including new and renewable energy, such as bioenergy, geothermal and utilizing industrial waste as an alternative fuel," he said.

In addition, Agus also reminded the manufacturing industry to anticipate disturbances in the global supply chain. Especially in the supply chain of industrial raw materials because the logistics lines of raw materials and industrial export products pass through the Middle East.

"The manufacturing industry must also mitigate the impact of the Iran-Israel war on currency exchange rate fluctuations resulting in production input price inflation and reduced competitiveness in industrial product exports," he said.

Furthermore, Agus said, the direct impact of the Iran-Israeli conflict is most visible in the energy market, where the Middle East's role as a major oil producer with the contribution of nearly 30 percent of global production, has put the market on alert.

In addition, disruptions to Iran's energy production, which production reaches 3.2 million barrels per day, will trigger supply disruptions as well as trigger energy price fluctuations in the international market.

Meanwhile, Brent oil prices have fluctuated between 73 and 92 US dollars per barrel following the outbreak of the Iran-Israeli war.

The world's energy price volatillity is also getting higher along with the threat of closing the Hormuz strait which has become the lifeblood of the world's energy supply line.

"As the country with the fourth largest population in the world and the largest economy in Southeast Asia, Indonesia is very vulnerable to fluctuations in world energy and food prices and disruptions to raw material supply chains," said Agus.

Earlier, Israeli Defense Minister Israel Katz announced an emergency situation across the country as Israel's attack on Iran began.

"After the Israeli state's preliminary attack on Iran, missile and aircraft attacks against the Israeli state and its civilian population are expected to occur soon," Defense Minister Katz said, quoted by The Times of Israel, Friday, June 13.

He said he had signed a "special order" which he said was a special state of emergency to be imposed on the front lines across Israel.

"You must comply with the instructions of the Frontline Command and the authorities and remain in a protected area," added Defense Minister Katz.

Separately, the sound of explosions has been heard in and near Iran's Iran capital, Tehran, amid reports by the Israeli media of the Israeli regime carrying out attacks on Iranian targets, quoted from IRNA.

Voice sources remain unclear and Israel's claims are not immediately verified.