Indonesia's shipbuilding industry to get incentives
The Indonesian government is laying out a set of incentives to spur growth in the shipbuilding industry as part of efforts to help realize the maritime-axis platform.
Indonesia's Industry Minister Saleh Husin said the government is mulling the scrapping of import duties on ship components and the value-added tax (VAT) to spur growth in the local shipbuilding industry, local reports said.
According to Saleh, a meeting to discuss the issue with relevant ministries has been scheduled for this week. Adding that this would be in line with the president's maritime-axis vision, Saleh said: ⌠Our shipbuilding industry outside Batam is still underdeveloped. We want to provide incentives for shipyards operating outside Batam so that they can expand."
Indonesia's shipbuilding industry is mainly concentrated in the Batam Free Trade Zone where shipyards are free from import duties and VAT.
The maritime nation however has over 200 shipyards in several areas, including Banten, Lampung, South Sulawesi and East Java, Maritime industry groups such as the Indonesia National Shipowners Association (INSA) and the Indonesian Offshore Industry and Shipping Association (IPERINDO) have called for the abolition of import and value-added taxes to help build up the shipbuilding industry in other regions outside Batam as well as allow domestic players to benefit from the cabotage rule implemented in 2011.
Source: GEMISEN Group