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Indonesia Halts Major Truck Order Amid Policy Clash
27 Feb
Summary
- Indonesia paused a 105,000-truck order from India.
- The imports faced pushback from local policymakers.
- Domestic production could create $1.6 billion economic benefit.
Indonesia has suspended a substantial order for 105,000 trucks from Indian companies Tata Motors and Mahindra & Mahindra. This pause comes after Indonesian policymakers raised objections to the import plan. The trucks were slated for use in President Prabowo Subianto's initiative to establish numerous community cooperatives across the nation.
Cooperatives Minister Ferry Juliantono stated that the halt is a necessary step to prevent further controversy and allow for a collaborative solution. The proposed imports have generated significant debate in Jakarta, particularly as other foreign automakers with established local manufacturing bases are working to recover their market presence.
Local business associations have opposed the import plan, arguing it contradicts the government's objectives of fostering industrialization and job creation. The Industry Minister emphasized that producing approximately 70,000 pick-up trucks domestically could yield substantial economic benefits, estimated at 27 trillion rupiah ($1.6 billion), including employment opportunities.
Mahindra had previously announced this order as its largest export deal, intending to deliver 35,000 Scorpio Pik Ups to support village-level commerce and national food security. Tata Motors' order for 35,000 Yodha pick-ups and 35,000 Ultra T.7 trucks was also its largest ever into Indonesia.
