Prabowo relaxes procurement rules

President Prabowo Subianto has officially relaxed government procurement rules. A new Presidential Regulation (Perpres) No. 46 of 2025 introduces these changes. The regulation, issued last week, affects how the government, regional administrations, and state-owned enterprises (SOEs) buy goods and services.

Key Changes in New Procurement Rules Based on TKDN

The new regulation allows the government to purchase imported products directly. This is permitted if local industries cannot supply goods. Those goods must have a combined Domestic Content Level (TKDN) and Company Benefit Weight (BMP) score above 40%.

This policy introduces a new hierarchy for prioritizing domestic products in government spending. The previous regulation Perpres No. 16/2018, did not explicitly outline this.

Here’s the new priority system:

• If a product’s combined TKDN and BMP score exceeds 40%, the government can purchase items with TKDN above 25%.
• If no product reaches the 40% mark, but items with TKDN over 25% exist, the government can procure those.
• If nothing exceeds 25%, the government can still purchase products with lower TKDN scores.
• If no products have TKDN certification, the government can procure locally available goods. These items must be listed in the National Industrial Information System (SIINAS).

This significant move by President Prabowo relaxing procurement rules aims to provide greater flexibility. It still encourages domestic production where possible.

Easier Certification Process Incoming

Separately, Industry Minister Agus Gumiwang Kartasasmita said the government will soon revise regulations governing TKDN certification. The upcoming rules aim to simplify calculations and speed up the issuance process.

“With the new regulation, companies will find it easier and faster to get TKDN certificates while reducing certification costs,” Agus said in Jakarta yesterday.

He added that the revised rules will undergo public consultation. Key stakeholders and industry players will be involved before finalization.

According to Agus, many business leaders welcome the new framework. They see it as a breath of fresh air for industries supplying goods to the government and SOEs.

“We greatly appreciate President Prabowo Subianto for signing and issuing Perpres No. 46 of 2025,” Agus said.