Strengthening the National Steel Industry Amid Import Pressures
Indonesia’s national steel industry is currently facing critical challenges. On one hand, industry players continue to push transformation efforts, ranging from energy efficiency, production process digitalization, to the adoption of low-emission technologies.
On the other hand, real-world conditions reveal serious pressures, such as the flood of imported steel, declining domestic demand due to government budget efficiency policies, and weak enforcement of regulations on the use of domestic products (P3DN).
These issues were among the key highlights at the Iron and Steel Summit & Exhibition Indonesia (ISSEI) 2025, organized by the Indonesia Iron and Steel Industry Association (IISIA) at JICC, Jakarta.
Shared Challenges
With the theme “Together with the National Steel Industry, Building the Foundation Toward Golden Indonesia”, ISSEI 2025 served as an important forum for steel industry players to voice common challenges, strengthen synergies, and advocate for policy support in building a sustainable and globally competitive steel industry.
During the forum's discussions, Saleh Husin, Deputy Chair of the Indonesian Chamber of Commerce and Industry (Kadin) for Industry and former Minister of Industry (2014–2016), emphasized the urgency of the situation to the government.
“Right now, our national steel industry is struggling, especially in facing the flood of imported steel in the domestic market. Moreover, domestic steel demand is declining due to the government’s budget efficiency policy,” said Saleh.
He added that market regulation is essential to prevent the circulation of non-standard steel, known as “besi banci”, often found in the black market.
“I also hope for clear rules to prevent the import of steel that can already be produced domestically, so that the competitiveness of the national steel industry can be further enhanced,” Saleh added.
Regarding the use of domestic products (P3DN), Saleh noted that although regulations exist, implementation on the ground remains weak. Therefore, he urged for assertiveness from President Prabowo in a limited cabinet meeting to ensure that state and regional budgets, as well as SOEs, are required to use domestically produced steel.
The Importance of Firm Regulations
This perspective was echoed by industry players. Fedaus, President Director of PT Gunung Raja Paksi Tbk (GRP), stressed the importance of strict regulation and protection of the domestic market.
“We are transforming—enhancing operational efficiency, expanding digitalization, and adopting environmentally friendly practices. However, if imported steel continues to enter without proper control, and non-standard products that lack SNI (Indonesian National Standard) and TKDN (Local Content Requirement) continue to circulate freely, this creates an unfair competition,” he said.
He added that the industry is not against open trade, but what is needed is fairness and support. According to him, the steel industry is the backbone of national development, and without real support, Indonesia’s goal of becoming an advanced industrial nation will be difficult to achieve.
“We can’t talk about downstreaming and industrialization in 2045 if the foundation—steel—isn’t strong in its own country. Now is the time to show real support, not just talk about it,” he stated.
According to data from the Ministry of Industry, national steel production capacity currently stands at around 17 million tons per year, while domestic demand in 2025 is projected to reach 21 million tons. There remains a gap that must be filled by imports. If not managed strategically, Indonesia’s steel demand—expected to reach 100 million tons per year by 2045—could lead to even greater dependence on foreign steel.
Through forums like ISSEI 2025, steel industry players are hoping for a shared commitment to building a strong, self-reliant steel industry that can contribute to Indonesia’s broader goal of becoming a developed nation.
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