INDEF Suggests Indonesia Needs To Accelerate Electric Battery Industry

Illustration/Photo: Antara

JAKARTA - Economic experts assess that Indonesia needs to accelerate the electric battery industry so that it can develop battery-based electric motorized vehicles.

"Indonesia is one of the largest contributors of raw materials in the world," said the Executive Director of the Institute for Development of Economics and Finance (INDEF), Tauhid Ahmad, during a discussion on "Development of Battery-Based Electric Cars in Indonesia", Wednesday, April 20.

INDEF assesses that the government has been quite good at developing nickel, the raw material for electric vehicle batteries, including export policies. He saw to accelerate this industry, there are still many steps that can be done.

Indonesia needs investors who have already ventured into electric vehicles, including South Korea and China, to invest more. Tauhid believes that electric vehicle manufacturers from China can compete with conventional vehicles currently in Indonesia

In addition, local players, such as Indonesia Battery Corporation, can partner with investors as an electric vehicle ecosystem.

The agency also believes that the Indonesian government needs to provide additional incentives to develop electric vehicles and battery-based electric vehicles, for example by exemption from Value Added Tax (PPN), Motor Vehicle Tax (PKB), and Sales Tax on Goods. Luxury (PPnBM).

Incentives, according to INDEF, can also be given in the form of credit, subsidies and the obligation to use battery-based electric motorized vehicles for certain objects.

Another step that can be taken to encourage the development of electric vehicles is a roadmap to reduce emissions to zero (zero emission).

In addition to incentives, the government can also provide disincentives for conventional vehicles in order to reduce emissions and dependence on fuel oil. Policies that can be implemented include taxes and excise for fuel and an increase in PPnBM.

Finally, INDEF assesses that the Domestic Content Level (TKDN) policy needs to be applied to electric vehicle products, namely by partnering with local manufacturers. This step is considered to be able to reduce the price of battery-based electric vehicles.