The Ministry of Industry (Kemenperin) initiated the Restructuring of Industrial Machinery/Equipment Refinement and Fabric Printing program. The program aims to improve the performance of the Textile and Textile Products (TPT) industry as a strategic sector.
The Ministry of Industry said that the Covid-19 pandemic that lasted for more than a year had a fairly severe impact on the performance of the textile industry. "We launched this program as one of the incentives for the textile industry sector to improve performance during the pandemic, as well as as part of the implementation of the Making Indonesia 4.0 roadmap," said Minister of Industry Agus Gumiwang Kartasasmita at the Launching and Socialization of the Machinery/Equipment Restructuring Program in the Improvement Industry. .
The textile sector is one of the industrial groups categorized as strategic and national priority industries according to the National Industrial Development Master Plan (RIPIN). This industry is a foreign exchange earner with an export value of 10.55 billion US dollars in 2020 and absorbs a workforce of 3.43 million people.
In the second quarter of 2021, the performance of the textile sector still experienced a contraction of minus 4.54 percent yoy (year on year), experiencing a slight improvement of 0.48 percent compared to the previous quarter. The export performance of this sector from January to June 2021 increased by 13 percent to US$ 5.87 billion and there was an increase in investment by 27 percent to US$ 3.5 trillion.
Even though it is classified as a heavily affected industry, the Ministry of Industry believes that the machinery and equipment restructuring program will be able to increase the efficiency and productivity of the textile sector. "Especially in August, the contraction in the manufacturing sector as a result of the implementation of the Implementation of Community Activity Restrictions (PPKM) has subsided, this can be seen in the Purchasing Managers' Index (PMI) of Indonesian manufacturing which stood at 43.7 in August. It has increased from 40.1 in July,” said Agus.
Through the provision of investment incentives, he continued, the Ministry of Industry will stimulate the industry to use machines and/or equipment that are more modern and environmentally friendly. This is expected to increase the productivity and competitiveness of the textile industry, which is one of the priority sectors for implementing Industry 4.0 in the Making Indonesia 4.0 roadmap.
He explained that the program was a continuation of the Machinery/Equipment Restructuring Program carried out in the textile, footwear and leather industry which was carried out from 2007 to 2015. The program implementation during that period had a positive impact on industry performance with the addition of machinery/equipment investment of Rp. 13 .82 trillion, an increase in production capacity in the textile industry by 21.75 percent, an increase in production realization by 21.22 percent, energy efficiency by 11.86 percent, an increase in sales volume both domestically and export by 6.65 percent, and an increase in the number of workers working as many as 28,295 people.
Agus conveyed that the Ministry of Industry again issued an incentive policy for restructuring machinery and equipment in 2021 so that the textile industry could upgrade its technology to increase efficiency and productivity. "The implementation of this policy is based on the Regulation of the Minister of Industry Number 18 of 2021 concerning the Restructuring of Machinery and/or Equipment in the Fabric Refinement Industry and the Fabric Printing Industry," he explained.
The 2021 Machinery/Equipment Restructuring Program focuses on the fabric improvement industry and the fabric printing industry as an effort to repair the weakest parts in the structure of the textile and textile product industry while strengthening the capacity and productivity of the fabric industry in order to achieve the 35 percent import substitution target by 2022. The largest portion of imports from the textile sector is in the import of finished fabric products, amounting to 48.4 percent of the total 2020 textile imports of 7.2 billion US dollars, "said the Minister of Industry.
He hopes that the fabric refinement and printing industry can take advantage of this program optimally to improve company performance and productivity. "This program uses the government's budget which needs to be properly accounted for, legitimately and transparently, we remind you to avoid engineering things and KKN," he said.
The Director General of the Chemical, Pharmaceutical and Textile Industry (Dirjen IKFT) of the Ministry of Industry Muhammad Khayam explained, the implementation of the program was carried out by providing a replacement or reimbursement of a discount of 10 percent of the total investment in machinery or equipment originating from imports, or 25 percent for domestically produced machinery or equipment. . "The available budget allocation in the 2021 Fiscal Year is IDR 3 billion with a target of at least six companies participating in the program. If you get an additional budget, the company's target can be increased," he explained.