Indonesian Minister of Industry Agus Gumiwang Kartasasmita has initiated the Draft Government Regulation (RPP) on Domestic Natural Gas, targeting a rapid enactment to support the manufacturing sector’s gas needs. He emphasized the importance of continuing the specific gas price program (HGBT) as a critical measure. "We are determined to sustain the HGBT program for the industry," he stated on 5 November 2024. The RPP will expand beyond the current seven subsectors, which include fertilizer, petrochemical, steel, ceramics, glass, oleochemical, and rubber gloves. According to Agus, this regulation could be a “game changer” for the manufacturing sector, a vital component of the national economy facing recent challenges.
Indonesia’s Purchasing Managers' Index (PMI) for manufacturing was 49.2 in October 2024, indicating continued contraction for four consecutive months. The government has maintained the HGBT policy since 2020, setting a fixed price of USD 6 per MMBTU for select industries. With the policy due to end on 31 December 2024, Minister Gumiwang has proposed expanding HGBT to cover all 24 manufacturing subsectors, noting that industry gas needs represent just 30% of the national supply and would not burden the state budget. The HGBT program has shown a threefold positive impact on industry investment, exports, and job creation since its implementation.
