Chairman Of Kadin Arsjad Rasjid: Incentives For Effective Electric Vehicles For Decarbonization Of Transportation Sectors

Chairman of the Indonesian Chamber of Commerce and Industry, Arsjad Rasjid. (Photo: Doc. Antara)

Chairman of the Indonesian Chamber of Commerce and Industry (KADIN) Arsjad Rasjid requested that the government's plan to provide incentives for electric vehicle products must be in line with the transition target to green energy or clean energy.

"Incentives for electric vehicles will accelerate electro-mobility in Indonesia as one of the most effective ways to decarbonize in the transportation sector," he said in his statement, quoted from Antara, Thursday, December 22.

As of October 25, 2022, a total of 31,827 units of electric vehicles have a Type Test Registration Certificate (SRUT).

Arsjad is also optimistic that various incentives will smooth the road to the target of 2 million electric vehicles by 2025.

This is because based on data from the Association of Indonesian Automotive Industries (Gaikindo) which shows a significant increase in ownership of electric vehicles. In this data, in July 2022 the sale of electric cars was only 131 units, then it jumped about 15 times in November 2022, which sold 1,965 units.

Arsjad reminded that electric vehicles are part of the program to shift to a green economy. Therefore, he hopes that the plan to provide incentives can be in line with the long-term roadmap to green energy.

"That way, between one policy and another, it is related to each other and becomes more comprehensive in supporting the energy transition to net zero carbon," he explained.

Furthermore, Arsjad reminded the need for conducive regulations to support the achievement of clean energy targets. For example, regulations that allow renewable energy can be accessed by industry.

"If it is increasingly difficult to access, the price will be expensive and the absorption capacity of the community will be low," he said.

In addition, Arsjad also said that another obstacle in developing a green economy is funding and technology. For this reason, cooperation and partnerships between the public and the private sector can be the key to facing these two challenges.

"Providing incentives such as taxes and tariffs is also important to accelerate the empowerment of new and renewable energy (EBT) in Indonesia, by making EBT competitive compared to fossil energy and forming attractive markets for investors," said Arsjad.

Incentives for electric vehicles were originally listed in Presidential Regulation (Perpres) Number 55 of 2019 concerning Battery-Based Electric Vehicle Programs (KBL) for Road Transportation.

Through this Presidential Regulation, electric vehicles in Indonesia are targeted to reach 2 million units by 2025. This Presidential Regulation also states that the central government and local governments provide incentives in the form of fiscal incentives and non-fiscal incentives to accelerate the Battery-Based KBL program for road transportation.

In addition, this Presidential Regulation states that the Battery-Based KBL industry which will build domestic battery-based KBL manufacturing facilities can be given incentives in accordance with the provisions of the legislation.