The Draft Minister of Industry Regulation (R-Permenperin) on Specific Industrial Areas (KIT) is a Ministry of Industry strategy to support the acceleration of development and industry distribution across Indonesia. On 4 June 2025, Tri Supondy, Director General of Industrial Resilience, Regional Development, and International Access (KPAII) at the Ministry of Industry, said that the draft is to provide solutions to the specific needs of industrial zones, including land constraints and thematic development. Industrial regional development is a strategic approach for the national industrial sector. The manufacturing industry is pivotal to the economy. In the last five years, the non-oil and gas processing industry has shown steady growth at 4-5% yoy. This sector has consistently contributed above 16% of the national GDP, reaching 17.50% in Q1 of 2025.
According to Tri, the development of industrial areas is carried out following the National Industrial Development Master Plan (RIPIN) until 2035. This is achieved through the establishment of Industrial Growth Centres (WPPI), Industrial Zones (KPI), and the development of Industrial Areas and Small and Medium Industry Centres (IKM). All industrial activities must be located within designated industrial areas. By May 2025, 170 industrial zone companies had obtained Industrial Zone Business Licences (IUKI), covering an area of 94,841 hectares with a land occupancy rate of 59.52%. Its purpose is to provide clearer guidance on the development of industrial zones with an area of less than 50 hectares under certain conditions, including the need for thematic zone development, e.g. tobacco products, marine and fisheries products, textiles, and digital industries, which are divided according to the WPPI development areas of Java and outside Java. This R-Menperin allows designated industrial zones established before 2015 to be recognised through transitional provisions. This opens up legalisation opportunities for these zones, notably in Batam City and similar areas.
