Pharmaceutical Industry Development Can be Included in Economic Policy Package

"The national pharmaceutical industry is dominated by downstream sector. Therefore, the Government is currently formulating a number of policies to encourage BUMN [state-owned enterprises] and national private companies to enter the upstream sector," Mr. Sibarani said in Jakarta on Saturday (1/9).

 

The development of pharmaceutical industry may be included in the next economic policy package, but we have not come to that yet, he said. However, the drug raw material is being discussed by BKPM and raw material industry.

 

He stated that facilities such as tax holiday and tax allowance have become major facilities to be offered to investors for building pharmaceutical industry in Indonesia. Nearly 95 percent of raw materials for drugs in Indonesia are imported.

 

"Is our financial ready for domestic production? It is impossible to rely on APBN [State Budget]. However, we have tax allowance and tax holiday facilities. In addition, we have human resources and opportunities in upstream sector. Furthermore, we have to accept the industry if using foreign workers," he added.

 

He admitted that it will take some time to invite foreign investors and to have commitments from the national private sector in developing pharmaceutical industry in Indonesia. With 95 percent of drug raw materials are still imported, there will be 95 percent of raw materials market if the pharmaceutical industry has been built within the country.

 

"In principle, it is expected that with tax holiday and tax allowance, raw material industry could be established in the country as soon as possible," he said. (Translator: Penni Patmawati Rusman)