I. What is TKDN?
TKDN (Tingkat Komponen Dalam Negeri) is the Domestic Component Ratio. It is the minimum proportion of local resources (including raw materials, production equipment, labor, and services) that the Indonesian government mandates for products. The TKDN certification, issued by the Indonesian Ministry of Industry, is an official proof to verify whether a product meets the localization standard. It is similar to China’s origin certification.
II. Policy Background and Objectives
The Indonesian government introduced the TKDN policy to balance the dual goals of attracting foreign investment and protecting local industries. By setting localization thresholds, the policy encourages businesses to prioritize local resources, thereby enhancing the competitiveness of domestic manufacturing. For example:
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Participation in government projects of state-owned enterprises (BUMN) or local enterprises (BUMD) requires a minimum TKDN of 25%.
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Certain industries, such as electronics and new energy vehicles, need to achieve higher ratios to gain market access.
III. Products Subject to Mandatory TKDN
The following categories are subject to specific TKDN thresholds:
Note: Non-mandatory products can also voluntarily apply for certification to enhance brand compliance and market competitiveness.
IV. Calculation of TKDN Value
The calculation formula is:
V. Certification Process and Timeline
Standard Process:
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Pre-Review of Materials: Organize production data and supply chain proof.
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Submit Application: Submit complete documents to the Ministry of Industry.
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Factory Audit: Experts conduct on-site verification of production processes and material authenticity.
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Supplier Verification: Review the consistency of documents from secondary suppliers.
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Certificate Issuance: Upon approval, a 3-year validity certification is granted, with no annual review required. Processing Time: Approximately 2-3 months, depending on the completeness of the materials and the audit schedule.
