Jakarta, INTI - Indonesia’s manufacturing sector has once again demonstrated strong resilience despite ongoing global uncertainties, including geopolitical conflicts, supply chain disruptions, and rising raw material costs. This is reflected in the country’s Manufacturing Purchasing Managers’ Index (PMI), which stood at 50.1 in March 2026, remaining in expansion territory.
“We are both surprised and grateful that amid extremely challenging conditions, both globally and domestically, Indonesia’s manufacturing PMI has consistently stayed above 50. This indicates the sector’s strong resilience,” said Agus Gumiwang Kartasasmita in an official statement.
Throughout the first quarter of 2026, Indonesia’s manufacturing PMI remained consistently in expansion, recording 52.6 in January and rising to 53.8 in February before moderating to 50.1 in March. Despite the slowdown, the index staying above 50 signals that industrial activity continues to grow.
Domestic Demand Sustains Industrial Growth
The Minister emphasized that this achievement is supported by the solid structure of Indonesia’s industrial sector, particularly sustained domestic demand. “Our industrial fundamentals remain strong. Domestic demand continues to be the main driver, helping to cushion significant external pressures,” he stated.
On a global scale, Indonesia’s PMI performance remains competitive. Several major economies also experienced a slowdown in manufacturing activity in March 2026. Japan, for instance, recorded a PMI of 51.6, slightly down from the previous month but still within expansion territory.
Within the ASEAN region, Indonesia remains among countries maintaining expansionary PMI levels, alongside Thailand (54.1), Malaysia (50.7), Myanmar (51.5), and the Philippines (51.3). However, not all countries have been able to sustain this momentum consistently, indicating that global pressures are being felt across multiple regions.
Global Pressures Continue to Challenge Manufacturing Activity
Globally, PMI surveys point to rising inflationary pressures and ongoing supply chain disruptions, largely driven by geopolitical tensions, particularly in the Middle East, which have pushed up energy and raw material costs.
“If we look globally, nearly all countries are facing similar pressures, both in terms of costs and supply chains. In this context, Indonesia’s ability to remain in expansion territory is an achievement worth appreciating,” Agus reaffirmed.
In March 2026, declines were observed in both output and new orders, largely due to disrupted raw material supplies and increasing input costs. Delivery times for raw materials also experienced the sharpest delays since October 2021.
Cost pressures have risen significantly, with raw material inflation reaching its highest level in the past two years. This has prompted manufacturers to adjust selling prices in order to maintain business sustainability.
Despite these challenges, industry players remain optimistic about future prospects. According to the March 2026 Industrial Confidence Index (IKI) survey, 73.7% of respondents reported stable or improving business conditions, while 71.8% expressed optimism about their business outlook over the next six months.
The Ministry of Industry continues to implement various strategic measures to maintain the resilience of the manufacturing sector, including strengthening industrial structures, increasing production capacity utilization, and optimizing the domestic market as a key growth driver.
In addition, the government is focused on ensuring smooth raw material supply and industrial logistics, while fostering a conducive business environment to keep the manufacturing sector competitive amid global dynamics.
“We, together with relevant ministries and agencies, will continue to ensure that domestic industries remain active, adaptive, and competitive. This resilience must be maintained, as the manufacturing sector is the backbone of the national economy,” the Minister concluded.
Conclusion
Indonesia’s manufacturing sector continues to demonstrate resilience amid global economic pressures, supported by strong domestic demand and solid industrial fundamentals. Although challenges such as rising costs and supply chain disruptions persist, the country remains in an expansion phase, reflecting sustained industrial activity. With ongoing government support and positive business sentiment, Indonesia is well-positioned to maintain stability and competitiveness in the evolving global manufacturing landscape.
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