National Telecommunications Equipment Imports Continue to Decline Since 2014

Based on CEIC data, Indonesia's telecommunications equipment imports reached US$2.63 million or Rp37.9 billion (Rp14,381/US$) in 2020. This figure decreased by 11.3% compared to the previous year, which reached US$2.97 million or Rp42.7 billion.

Domestic telecommunications equipment imports have shown a declining trend throughout 2014-2020. The biggest drop occurred in 2017, reaching 40.56% to US$3.5 million or Rp50.4 billion.

The decrease in telecommunications equipment imports is attributed to the Domestic Component Level (TKDN) regulation for 4G LTE infrastructure. This policy, initiated by the Ministry of Trade, Ministry of Industry, and Ministry of Communication and Informatics, has been in effect since 2015.

TKDN represents the percentage of Indonesian-made components used in a 4G LTE-based product. These components include not only hardware but also software and local labor.

This regulation aims to reduce the trade deficit caused by the high volume of imported goods entering Indonesia. During the 3G era, mobile phones were imported freely without any restrictions. Through the TKDN requirement, the domestic mobile phone industry has been able to grow and create more jobs.