Indonesia pushes EV battery, critical mineral projects to woo US in tariff talks
The state asset fund Danantara will also be involved in the proposed mineral project.
'[The investment is] for brownfield critical mineral projects in Indonesia. We are clearly offering that to the US,' Airlangga said, noting that the projects involved the expansion of existing operations rather than starting from scratch, as quoted by Kontan.
However, he declined to identify the projects due to confidentiality agreements.
'We've presented them […] and for the United States, this offer is quite compelling,' Airlangga added
Airlangga explained that the proposal would leverage the country's vast nickel reserves and expand EV battery production capacity. Indonesia is the world's largest producer and holds the biggest estimated reserves of nickel, a key material for most of the batteries used in EVs such as those built by US-based carmaker Tesla Inc.
On Sunday, President Prabowo Subianto kicked off construction on a US$5.9 billion EV battery plant in Karawang, West Java. The facility will be operated by a joint venture between state-owned EV battery holding firm Indonesia Battery Corporation (IBC) and Chinese battery producer Contemporary Amperex Technology Co. Ltd. (CATL).
Airlangga further noted that investments in critical minerals would support industries such as electronics, defence and aerospace.
'All of them require cables and copper. We already produce copper cathodes, and American firms are part of that ecosystem,' he said, making a reference to existing US investment in copper miner PT Freeport Indonesia.
The joint investment pitch builds on earlier commitments Jakarta has made to Washington, including increasing imports of US-made food and fuel, loosening import restrictions and pursuing outbound investment in the US to balance out bilateral trade and placate the White House amid threats of steep 'reciprocal' tariffs.
More than 60 days have passed since both sides agreed to wrap up negotiations within that timeframe, before a grace period expires that the US granted Jakarta to try and stave off a 32 per cent import tariff on Indonesian goods, with a 90-day tariff pause set to expire on July 9.
The government on Monday unveiled a series of new import regulations that will ease access to goods and raw materials as well as reducing non-tariff barriers ahead of the looming deadline.
Airlangga noted that deregulation was also part of a broader effort to placate Washington in ongoing bilateral tariff negotiations. '[Deregulation] will be conducted in stages. There are measures we've already implemented, and others will depend on the outcome of the tariff negotiations,' Airlangga told reporters after the press briefing.
US President Donald Trump said he is not planning to extend the 90-day pause on tariffs on most nations beyond July 9, when the negotiating period he set would expire, warning that trade penalties will take effect unless countries reach separate deals with Washington.
He told Fox News on Friday that letters would be sent out soon, notifying nations of tariffs ranging from 10 to 50 per cent unless agreements are made. - The Jakarta Post/ANN
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