Indonesian Government investigates textile imports to protect domestic industry

The Indonesian government has taken the initial step of investigating imported textile products to protect its domestic textile industry from foreign competition. This action follows a formal request made by the Indonesian Textile Association (API) in September. The investigation is being led by the Indonesian Trade Safeguard Committee (KPPI), which operates under the Ministry of Trade.

One of the key factors that prompted the Ministry of Trade to launch this investigation is the noticeable decrease in the number of workers in the domestic textile industry. Additionally, there has been a decline in the market share of products made by domestic producers. These signs have raised concerns.

Indonesia’s textile and apparel sector has been facing significant challenges during the global economic downturn. Many companies in this sector have reported sharp declines in their export revenues, making it increasingly difficult for them to continue their operations.

Nugraheni Prasetya Hastuti, the Acting Chairman of KPPI, mentioned in a press release on October 31st that the committee has identified early signs of significant losses or a risk of such losses due to the surge in textile imports.

The investigation focuses on various textile goods, including cotton woven fabric, cotton sewing thread, cotton yarn, and fabric woven from man-made filament yarn. These specific products have seen an increase in imports, from 14,843 tonnes in 2019 to 29,908 tonnes over the past four years.

The World Trade Organization (WTO) permits its member nations to take precautionary measures like this investigation when they believe it’s necessary to protect their domestic industries.