Textile and textile product (TPT) entrepreneurs are nervous about the plan to increase the basic electricity tariff (TDL) which will take effect in April 2022. Secretary General of the Indonesian Filament Yarn and Fiber Association (APSyFI) Redma Gita Wirawasta said that the increase in TDL will almost certainly be responded to by industrialists by increasing the price of the final product. This means that the price of textile products will be more expensive, even though people's purchasing power has just crawled up after being hit by the pandemic.
"We are nervous how big the increase will be. We can bypass [the increase in TDL] to the final price. The problem is, we are worried that the absorption capacity will also decrease," said Redma (31/1/2022).
In addition to electricity for industry, TDL for individual customers will also increase. This means that pressure on people's purchasing power will come from two sides, namely supply and demand. Not to mention there is a risk of pressure from increasing the value added tax (VAT) to 11 percent starting April 1, 2022.
Based on the TDL adjustment plan by the Ministry of Energy and Mineral Resources, the increase in class I-3 or electricity usage above 200 kVS and I-4 with power usage above 30,000 kVA is projected to be 15.97 percent and 20.78 percent, respectively.
Meanwhile, according to data from the Central Statistics Agency (BPS) processed by the Ministry of Industry, the increase will raise the cost of goods manufactured (HPP) for the textile industry by 1.05 percent for groups I-3 and 1.37 percent for groups I-4. As for the apparel industry, the increase in HPP is estimated at 0.34 percent for group I-3 and 0.44 for group I-4.
In fact, the focus of the industry this year is not on exports but on strengthening the domestic market. This is evidenced by the investment of a total of IDR 10.5 trillion at the end of last year by nine industrial companies.
Redma estimates that investment in the textile and textile products industry this year will be at least US$400 million or around Rp5.75 trillion. Meanwhile, the growth of the textile industry is targeted at 5 percent this year. Realization of growth throughout 2021 is estimated at 1.37 percent.
