The Indonesian government will provide low-interest credit facilities for modernizing textile machinery and in turn strengthen competitiveness of the textile industry.
Finance Minister Purbaya Yudhi Sadewa informed that this support will be provided through the Indonesian Export Financing Agency (LPEI) or Indonesia Eximbank.
“The Indonesian textile industry has often struggled to obtain financing from banks because it is considered a sunset industry. As a result, many businesses struggle to modernize machinery and increase production efficiency,” Sadewa said.
“The government believes intervention is necessary to ensure the textile industry and export-oriented manufacturing sector remain competitive in the global market,” the minister stated.
The government will provide loans at an interest rate of around 6% through the Indonesia Eximbank (LPEI) and may even still lower the interest rate if it’s deemed too high for the industry.
Sadewa revealed that the government has held meetings with textile industry players and related associations to discuss the program’s implementation.
Coordination will also be carried out with the Ministry of Industry to determine which sectors and companies are eligible to receive the financing facility.
However, Sadewa emphasized that affordable credit will only be provided to companies with good business prospects.
“Industries deemed to still have growth potential and the ability to improve export performance will be prioritized for financing access,” he noted.
Image courtesy: Aditya Birla
