With the electric vehicle boom looming on the horizon, the Indonesian government has made moves to dominate the market.


Minister of Industry Agus Gumiwang Kartasasmita is optimistic that the myriad of mineral resources the country has will ease the development of the electric vehicle ecosystem. He also believes that Indonesia will play an essential role in the electric vehicles global supply chain.

"We are optimistic that Indonesia would become a competitive global producer of low-emission and environmentally-friendly vehicles. For that, we need to take a step towards accelerating a solid and integrated ecosystem," said Agus on Thursday.

The minister revealed that the government is taking the development of the electric vehicles industry ecosystem up a notch from top to bottom. One way to do so is by increasing capital investment in the subject to strengthen the structure of domestic manufacturing.

"Many investors had proposed to contribute to the development of the EV ecosystem in Indonesia," added Agus. One of the investors that have agreed to produce EVs in Indonesia is Hyundai. Hyundai's IONIQ 5 will be the first EV that Indonesia will manufacture.

In addition, the government has also been focusing on executing downstream policies. The intention is to increase the value-added of Indonesian natural resources for people's well-being.

"As the President has said, we have nickel and cobalt, and they are the primary materials for lithium batteries. Apart from that, bauxite can be processed into aluminum which is the raw material for EV frames, as well as copper that is needed for the batteries and EV's wiring system. We must optimize these potentials," said the minister.

Previously, it was reported that several investors would start the construction of lithium battery factories later this year.

Road to net-zero
The minister revealed that the government had set some targets to pursue. By 2024, Indonesia is expected to be already able to domestically produce electric vehicles along with its crucial components like batteries.

The Indonesian national automotive industry roadmap has targeted that by 2025, 20 percent of existing vehicles will be replaced with EVs. The industry will also focus on improving the efficiency of Internal Combustion Engine (ICE), Hybrid and Plug-in Hybrid. In addition, the minister also revealed that hydrogen fuel cells had been included in the roadmap as well.

Moreover, the domestic automotive industry is targeted to produce 600 thousand units of electric cars and buses by 2030. That target will reduce as much as three million barrels of fossil fuel consumption, which is equal to 1.4 metric tonnes of CO2 emission.

"These strategic efforts are hoped to support the government's commitments in reducing 29 percent greenhouse gas emission by 2030 as well as reaching zero-emission or net-zero carbon by 2060," noted Agus.

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