Indonesia and India to Address Trade Relationship Hurdles
JAKARTA, investortrust.id – Coordinating Minister for Economic Affairs Airlangga Hartarto stated that bilateral talks between Indonesia and India are progressing positively, despite lingering challenges, particularly India’s protective measures for its domestic industries.
“There are indeed some obstacles in the trade relationship between Indonesia and India,” Airlangga said at his office in Jakarta on Thursday, Jan 30, 2025.
Airlangga revealed that he had met with India’s Minister of Commerce and Industry, Piyush Goyal, to discuss trade agreements between the two nations. One of the key issues raised during the talks was India’s protective policies for its domestic industries, which have led to higher import tariffs and quotas on several Indonesian products.
“India has requested that the trade deficit be narrowed. We will discuss the technical details further,” Airlangga explained.
The trade imbalance has emerged as a focal point, with Indonesia maintaining a surplus with India. According to data from Indonesia’s Central Statistics Agency (BPS), the cumulative trade surplus with India reached $15.39 billion in 2024, up from $14.51 billion in 2023. “India is essentially asking us to import more from them,” Airlangga noted.
To address this, Airlangga said Indonesia is mapping out potential sectors for increased imports from India. Historically, Indonesia has imported commodities from the food sector, and the government is considering opening up imports in the pharmaceutical sector as well.
“We are looking at pharmaceuticals, which could help reduce healthcare costs in Indonesia. India has strong capabilities in non-generic drugs,” he added.
The discussions highlight the complexities of balancing trade relations while addressing domestic economic priorities. Both nations aim to strengthen their partnership, but protective measures and trade imbalances remain key challenges to be resolved.