Medical Device Industry Under Pressure as Raw Material Import Costs Soar

Global geopolitical turmoil, which has triggered a weakening of the Rupiah exchange rate, rising oil and raw material prices, and supply chain disruptions, is impacting Indonesia’s healthcare industry. This is because the majority of raw materials for the country’s health sector still rely on imports, so when the exchange rate weakens, the cost of importing raw materials swells and pressures industry performance.

Erwin Hermanto, Secretary General of the Indonesian Medical Device Manufacturers Association (ASPAKI), stated that since 2025, the medical device industry has been under pressure due to local government efficiency measures and changes to central government flagship programmes. As a result, regional economic turnover has weakened, leading to reduced purchasing power and a widening economic gap between the central and regional levels. Additionally, the impact of procurement centralisation and changes to government goods procurement procedures has increased competition among medical device products and depressed selling prices.

The rise in production costs combined with pressure on selling prices is making it increasingly difficult for the medical device business to survive.