Minister Bahlil Claims B50 Programme Could Save Rp 170 Trillion in Foreign Exchange

Energy and Mineral Resources (ESDM) Minister Bahlil Lahadalia has claimed that the mandatory B50 biodiesel programme will retain hundreds of trillions of rupiah in foreign exchange within the country. The programme is expected to generate savings by reducing the foreign exchange previously spent on diesel imports. The B50 scheme mandates a 50 percent blend of processed palm oil in diesel fuel sold in Indonesia. Minister Bahlil expressed confidence that the programme would not only reduce diesel imports but also create a domestic market for crude palm oil (CPO). “If the price of CPO is low abroad and other countries do not want it, then we will set aside a portion to build the B50 downstream industry,” he said during the programme’s launch with President Prabowo Subianto in Karawang, West Java, on Thursday, 9 July 2026. The Golkar Party Chairman believes the B50 programme will raise palm oil prices for both farmers and the industry. He estimates that domestic CPO demand could increase from 15.2 million tonnes to up to 17 million tonnes, providing market certainty for palm oil farmers. Consequently, Bahlil stated that more foreign exchange would be retained domestically as money would no longer flow abroad for diesel imports. Bahlil said the B50 programme would retain up to Rp 170 trillion in foreign exchange, an increase from the B40 programme, which he claimed previously retained around Rp 133 trillion. Furthermore, Bahlil stated that the added value of the CPO industry could rise from Rp 20.92 trillion to Rp 23.49 trillion. In terms of employment, he claimed that job absorption would increase from approximately 1.8 million people under the B40 programme to 2.1 million people under B50. The government also claims B50 will assist in meeting greenhouse gas emission reduction targets. Bahlil stated that emission reductions could increase from 39.66 million tonnes of CO2 to approximately 44.46 million tonnes of CO2 with the mandatory B50 programme. Bahlil said this policy would eliminate Indonesia’s dependence on diesel imports. “With the implementation of B50, alhamdulillah, we will no longer import diesel products into our country,” he said. The legal basis for the B50 Biodiesel Mandatory Programme is ESDM Ministerial Regulation Number 4 of 2025 concerning the Business and Utilisation of Biofuels, along with ESDM Ministerial Decree Number 257.K/EK.01/MEM.E/2026 of 2026 regarding the Obligation of 50 Percent Biodiesel Blending in Diesel Fuel. The policy mandates a 50 percent biodiesel blend for all types of diesel fuel. In its implementation, biofuel business entities, fuel business entities, and distributor business entities are required to apply standards and quality according to established specifications. Fuel business entities that fail to fulfil the blending obligation, or biofuel business entities that do not distribute biodiesel according to the 50 percent implementation target, may be subject to administrative sanctions including written warnings, temporary suspension of activities, and/or revocation of business permits in accordance with statutory provisions. To support the implementation transition, fuel business entities are given a transition period until 30 September 2026 to deplete biodiesel stocks with the B40 blend specification. The Ministry of ESDM will also conduct evaluations of the B50 implementation every three months.