An Analysis of Import Tariff Policies to Protect Indonesia’s Textile Industry in 2025

Abstract

The textile and textile products (TTP) industry is a strategically important labor-intensive sector of the Indonesian economy. However, in recent years, the industry has faced severe pressure due to the influx of imported products, weakening global demand, factory closures, and large-scale layoffs. This study aims to analyze Indonesia’s TTP import conditions in 2025, describe the import tariff policy instruments implemented by the government, examine their impacts on the domestic textile industry, and assess the effectiveness of these policies as instruments of industrial protection. The study employs a descriptive qualitative approach using a literature review and policy document analysis. The data consist of secondary sources obtained from Statistics Indonesia (BPS-Statistics Indonesia), the Ministry of Trade, the Ministry of Finance, the Ministry of Industry, industry associations, and relevant scholarly literature. Data analysis was conducted through data reduction, data presentation, and conclusion drawing, supported by source triangulation. The findings indicate that the import tariff policies implemented by the government include general Most-Favoured-Nation (MFN) tariffs, safeguard duties, and anti-dumping duties, complemented by non-tariff measures, including tighter import licensing requirements and law enforcement against illegal imports. Tariff policies have provided some room for domestic producers to recover in certain product segments. However, their effectiveness remains limited due to the restricted range of products subject to such measures, the substantial share of imports entering under preferential tariff schemes established through free trade agreements, the prevalence of illegal imports that bypass tariff measures, and structural challenges within the industry, including high energy costs and aging production machinery. Therefore, tariff policy should be positioned as a temporary instrument and complemented by industrial restructuring policies to ensure that protection does not result in long-term dependence.