Industry Minister Airlangga Hartarto and his Japanese counterpart, Economy, Trade and Industry Minister Hiroshige Seko sign an agreement in Osaka on Thursday. (Photo courtesy of the Ministry of Industry)

Japan Agrees to Spend $2b to Develop Electric Cars in Indonesia


JUNE 27, 2019

Jakarta. Japan has agreed set aside Rp 28 trillion, or around $2 billion, to develop electric cars in Indonesia, Industry Minister Airlangga Hartarto said in a statement on Thursday. 

The agreement was part of a wider cooperation in manufacturing between the two countries under the Indonesia-Japan Economic Partnership Agreement. 

Airlangga and his Japanese counterpart, Economy, Trade, and Industry Minister Hiroshige Seko, signed the agreement in Osaka on Thursday.

"This agreement covers cooperation in the automotive, electronic, chemical, fabric and textile, chemical and food, and beverage sectors," Airlangga said.

Also present in the meeting was Akio Toyota, the president of Japanese automotive giant Toyota Motor, who discussed a plan to develop electric vehicles in Indonesia. 

President Joko "Jokowi" Widodo has said that he wants to see Indonesia's automotive industry move into the manufacturing of electric cars soon. He has also pushed the country's nickel miners to support the development of batteries for electric cars. 

The government has also prepared emission-based tax cuts for cars to encourage electric vehicle development, Airlangga said. 

Japan is one of Indonesia's largest investors, with interests in oil and gas mining, automotive, retail and banking sectors.