Indonesia will establish a new state-owned enterprise (SOE) dedicated to textiles.
The move positions textiles as a frontline industry in Indonesia’s response to escalating US tariff pressures on global apparel and textile trade.
Rather than rescuing legacy firms, the government aims to build a modern, future-ready textile champion from scratch.
To support the initiative, Indonesia has earmarked USD 6 billion via Danantara, the country’s investment and sovereign wealth manager.
Funds will be deployed toward:
- Procurement of advanced capital goods
- Adoption of new manufacturing technologies
- Export expansion across textile and garment segments
The government has finalized a preliminary study and is developing a national textile roadmap with a bold objective:
- Increase textile exports from USD 4 billion to USD 40 billion within 10 years
- Deepen domestic value chains, particularly in weak segments:
- Yarn
- Fabric
- Dyeing
- Printing
- Finishing
The new SOE is expected to act as a catalyst for industrial upgrading, filling structural gaps that currently force reliance on imports or fragmented private capacity.
Indonesia’s move signals a shift toward state-led industrial deepening, not just trade defense. Key implications include:
- A push toward vertical integration in textiles
- Accelerated technology modernization
- Strategic use of sovereign capital to build export resilience
- Alignment with broader industrial sovereignty goals
If executed effectively, the textile SOE could reshape Indonesia’s position in global apparel sourcing—moving from cost-based competition toward scale, technology, and value-chain control.
