Indonesia encourages use of electric vehicles

Indonesia continues to push the use of electric vehicles (EVs) with the dream of bluer skies and cleaner air in the country.

Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Pandjaitan is striving to realise the target as as "conductor" in the "orchestra" of EV industry development in Indonesia.

Nevertheless, he did not deny the fact that fossil fuel transportation is not the only contributor to air pollution in Indonesia.

Pandjaitan ensured that various policies of ministries and institutions are in harmony, so that the dream of changing people's habits from using fossil fuel vehicles to EVs could be realised.

The population of EVs in Indonesia has shown significant growth. In 2022, the number of electric motorcycles in Indonesia stood at 17,198 units, which rose to 62,409 units in 2023, according data from the Ministry of Transportation's Type Test Registration Certificate.

Likewise, the population of electric cars also showed growth, albeit not as high as electric motorcycles. The number of four-wheeled EVs in 2023 rose by 43%, from 8,562 units in 2022 to 12,248 units in 2023.

Despite the government having issued various incentive programs, the increase in the number of EVs is not sufficient to boost the EV industry in Indonesia.

Hence, to this end, the government has devised a new incentive program, namely import duty and sales tax on luxury goods incentives. The incentives apply for the imports of electric cars in the Completely Built-Up (CBU) and Completely Knocked Down (CKD) categories