Ministry of Industry Says HGBT and Import Duty Relaxation are Drivers of July 2026 Manufacturing Increase

JAKARTA - The Ministry of Industry (Kemenperin) assesses that the return of manufacturing activities to the expansion zone in July 2026 is supported by a number of government policies, including certainty of the implementation of the Specified Coal Gas Price (HGBT) and the relaxation of import duties on plastic raw materials.

Ministry of Industry spokesman Febri Hendri Antoni Arif said the increase in the Purchasing Manager's Index (PMI) of Indonesian Manufacturing to 50.2 in July 2026 from 46.9 in June showed that industrial production activities were beginning to be positive.

"The increase in PMI confirms that the production wheel of the processing industry is moving again. The increase in output and the growth of new jobs show consumer confidence and the demand of the domestic market is beginning to improve," said Febri in a written statement, Monday, August 3.

Based on the S&P Global survey, Indonesia's Manufacturing PMI is again above the 50 level after having been corrected in the previous month.

The improvement was driven by an increase in output for the first time since February 2026, a stabilization in new orders and an increase in labor after four months of contraction.

The same survey also showed business optimism about the outlook for the next 12 months reached the highest level in the last six months.

On the other hand, the rate of increase in raw material prices slowed to the lowest level in four months.

Febri assessed that one of the factors that underpinned this optimism was the certainty of the implementation of the HGBT for the industry.

According to him, this policy helps maintain the competitiveness of gas user industries, such as fertilizers, petrochemicals, ceramics, glass, steel, rubber gloves to oleochemistry, through price certainty and energy supply.

In addition, the government has also issued a Minister of Finance Regulation (PMK) regarding the relaxation of import duties on plastic raw materials.

He said that the policy is expected to reduce production cost pressure for industries that use plastic raw materials, such as packaging, food and beverage, automotive and electronics industries.

"The combination of certainty of HGBT and relaxation of import duties on plastic raw materials helps maintain the efficiency of the industrial cost structure while supporting the optimism of business actors," said Febri.

Even so, the Ministry of Industry reminded industry players to remain aware of global supply chain uncertainties and exchange rate fluctuations.

The government, continued Febri, will continue to monitor the availability of raw materials, energy supply, and protection of the domestic market so that the trend of manufacturing recovery can continue.