New Regulations Deemed Potentially Disruptive to Grassroots Economic Chain
The Chairman of the Indonesian White Cigarette Producers Association (Gaprindo), Benny Wachjudi, has said the establishment of maximum nicotine and tar limits on tobacco products has drawn fierce opposition from industry players.
According to Wachjudi, the policy is considered potentially far-reaching in its impact on the Tobacco Product Industry (IHT) ecosystem, from business certainty to farmer welfare. He argues that overly strict standards are incompatible with the characteristics of local tobacco and could trigger knock-on effects on the national economy.
Wachjudi noted that 99.96 per cent of tobacco plantation areas in Indonesia are smallholder farms. Naturally, tobacco grown in Indonesia tends to have higher nicotine levels than the proposed standards. This situation, he warned, would render farmers' harvests unmarketable to industry if the threshold is set too low.
He cautioned that if local raw materials fail to meet the requirements, the industry could shift to imports to comply with the regulations.
"The impact of setting maximum nicotine and tar levels runs counter to the government's efforts to improve farmer welfare," he said in a written statement quoted on Wednesday, 18 February 2026.
Beyond this, the industry also faces the risk of losses from existing raw material stocks. Wachjudi explained that the tobacco product industry has a waiting period of three to five years for tobacco use. Sudden regulatory changes could render already-purchased stocks unusable.
Gaprindo also highlighted the potential for increased circulation of illegal cigarettes. Tobacco not absorbed by the formal industry risks being exploited by irresponsible parties to produce cigarettes without proper standards.
Furthermore, Wachjudi stressed that nicotine and tar levels are in fact already regulated through Indonesian National Standards (SNI) established by the National Standardisation Agency. These standards were drawn up pursuant to the mandate of Law Number 20 of 2014 on Standardisation and Conformity Assessment.
Gaprindo considers that setting new limits without reference to the SNI could create regulatory dualism and confuse business operators. The government is therefore advised to optimise existing regulations.
"If necessary, existing SNI parameters can be revised through the National Consensus. However, should the government proceed with issuing a Coordinating Minister for Human Development and Culture Regulation, the parameters used must be consistent with the SNI parameters," Wachjudi affirmed.
According to Wachjudi, the policy is considered potentially far-reaching in its impact on the Tobacco Product Industry (IHT) ecosystem, from business certainty to farmer welfare. He argues that overly strict standards are incompatible with the characteristics of local tobacco and could trigger knock-on effects on the national economy.
Wachjudi noted that 99.96 per cent of tobacco plantation areas in Indonesia are smallholder farms. Naturally, tobacco grown in Indonesia tends to have higher nicotine levels than the proposed standards. This situation, he warned, would render farmers' harvests unmarketable to industry if the threshold is set too low.
He cautioned that if local raw materials fail to meet the requirements, the industry could shift to imports to comply with the regulations.
"The impact of setting maximum nicotine and tar levels runs counter to the government's efforts to improve farmer welfare," he said in a written statement quoted on Wednesday, 18 February 2026.
Beyond this, the industry also faces the risk of losses from existing raw material stocks. Wachjudi explained that the tobacco product industry has a waiting period of three to five years for tobacco use. Sudden regulatory changes could render already-purchased stocks unusable.
Gaprindo also highlighted the potential for increased circulation of illegal cigarettes. Tobacco not absorbed by the formal industry risks being exploited by irresponsible parties to produce cigarettes without proper standards.
Furthermore, Wachjudi stressed that nicotine and tar levels are in fact already regulated through Indonesian National Standards (SNI) established by the National Standardisation Agency. These standards were drawn up pursuant to the mandate of Law Number 20 of 2014 on Standardisation and Conformity Assessment.
Gaprindo considers that setting new limits without reference to the SNI could create regulatory dualism and confuse business operators. The government is therefore advised to optimise existing regulations.
"If necessary, existing SNI parameters can be revised through the National Consensus. However, should the government proceed with issuing a Coordinating Minister for Human Development and Culture Regulation, the parameters used must be consistent with the SNI parameters," Wachjudi affirmed.