Indonesia-Japan Partnership Strengthens with Accelerated Automotive and Renewable Energy Cooperation
Strategic cooperation between the Indonesian and Japanese governments is growing increasingly robust in driving industrial development, energy transition, and strengthening global supply chains.
“In the automotive sector, Japan has played a crucial role in building the automotive industry ecosystem in Indonesia. Currently, Indonesia not only has a domestic market but has also developed as an automotive production hub that exports vehicles to more than 70 countries,” said Coordinating Minister for Economic Affairs Airlangga Hartarto during a meeting with Executive Acting Secretary-General of the Liberal Democratic Party (LDP) Koichi Hagiuda in Tokyo, Japan, on Wednesday (11 March 2026).
Going forward, Indonesia will continue to maintain an attractive investment climate by enhancing competitiveness in the automotive components industry, particularly at tier 2 and tier 3 levels, thereby strengthening industrial supply chains and fostering the emergence of universal brands.
During the same meeting, Hagiuda conveyed support for Indonesia’s efforts to develop more environmentally friendly fuels, including implementation of the B40 biodiesel programme and plans for E20 development by 2028.
Japan’s automotive industry is said to be ready to follow the direction of Indonesian Government policies in supporting the energy transition agenda in the transport sector.
Beyond automotive, cooperation in renewable energy and new energy sectors continues to advance through the Asia Zero Emission Community (AZEC) framework. Several projects have reached financial closing and are continuing, including the development of the Muara Laboh Geothermal Power Plant in West Sumatra, the Legok Nangka Waste-to-Energy project in West Java, and hydroelectric power generation projects in North Kalimantan.
Both parties also discussed opportunities for future strategic industrial cooperation, including through the role of the Japan Organization for Metals and Energy Security (JOGMEC), established by Prime Minister Sanae Takaichi.
These efforts will expand collaboration in resource development and industry between Japan and Indonesia. Japan also recognises significant potential in Indonesia for strengthening the economic security sector, including in developing industrial technology supply chains such as semiconductors.
This Indonesia-Japan meeting reaffirms the increasingly strong partnership between the two countries in supporting the development of strategic sectors. Going forward, their collaboration is expected to be further strengthened to drive sustainable economic growth and the development of increasingly competitive industries.