Indonesia Textiles Market Outlook to 2028

Indonesia Textiles Market Overview

The Indonesia Textiles Market is valued at USD 11.5 billion, with growth attributed to its historical market performance and robust demand both domestically and internationally. The market's expansion is largely driven by rising demand in fashion, industrial, and household sectors, along with government initiatives aimed at promoting textile exports.

Indonesias textile market is primarily dominated by regions like Java and Sumatra, which hold a strong position due to their established manufacturing infrastructure and access to major ports facilitating export activities. Java, in particular, is the central hub for textile production, thanks to its concentration of skilled labor, developed industrial base, and proximity to key export markets.

In 2024, the Indonesian government is set to allocate IDR 1.5 trillion towards revitalizing the textile and garment industry under its National Industrial Development Policy. This initiative focuses on modernizing existing factories and providing low-interest loans for the purchase of advanced machinery, which is expected to help local manufacturers increase production by 30 million pieces annually and reduce manufacturing costs by IDR 2 trillion over the next five years.

Indonesia Textiles Market Segmentation

By Application: The market is segmented by application into clothing, industrial textiles, and household textiles. Among these, clothing dominates the market due to Indonesias rich tradition in textile manufacturing, particularly in producing Batik and other traditional textiles. This segment is highly supported by both domestic and international demand, with ready-to-wear clothing for export markets playing a major role.

By Material: The market is also segmented by material, including cotton, synthetic fibers, wool, silk, and other natural fibers. Cotton holds the largest share due to its high demand in both traditional and modern textile products. Indonesias favorable climate for cotton farming, combined with technological advancements in cotton processing, makes this material a dominant sub-segment.

Indonesia Textiles Market Competitive Landscape

The competitive landscape of the market is characterized by a mix of local players and multinational corporations, with key players leading in innovation, sustainability practices, and large-scale production capacity.

Company

Year Established

Headquarters

Key Products

Annual Revenue

Employees

Export Markets

Sustainability Initiatives

PT Sri Rejeki Isman Tbk

1966

Solo, Indonesia

PT Asia Pacific Fibers Tbk

1984

Jakarta, Indonesia

Indorama Corporation

1975

Jakarta, Indonesia

PT Pan Brothers Tbk

1980

Jakarta, Indonesia

PT Tifico Fiber Indonesia Tbk

1973

Tangerang, Indonesia

Indonesia Textiles Market Analysis

Market Growth Drivers

Increased Exports to Key Markets: Indonesias textile industry has seen a rise in exports to key markets such as the United States and European countries, with over 3 million tons of textiles shipped annually. This expansion is driven by strong demand for Indonesian garments, which are valued for their competitive pricing and high-quality production standards.

Government Support and Industrial Parks Expansion: The Indonesian governments backing of the textile industry through policy initiatives and industrial zones, such as the establishment of specialized textile industrial parks in Java, has significantly contributed to the sector's growth. In 2024, the government allocated IDR 200 trillion to develop textile manufacturing hubs across the country, aimed at increasing local production capacity.

Rising Domestic Consumption: Indonesias growing middle-class population, currently estimated to reach 100 million by 2024, has spurred domestic demand for textiles and garments. Local consumption of apparel and textiles is expected to exceed 1 billion pieces in 2024, supported by an increasing preference for locally manufactured products.

Market Challenges

Intense Competition from Regional Producers: Indonesias textile industry faces stiff competition from other major textile-producing nations in Southeast Asia, such as Vietnam and Bangladesh, which benefit from lower labor costs.

Labor and Skill Shortages: The textile sector in Indonesia continues to struggle with a shortage of skilled labor, particularly in advanced manufacturing processes. In 2024, it is estimated that the industry will need an additional 150,000 skilled workers to meet production demands.

Indonesia Textiles Market Future Outlook

Over the next five years, the Indonesia Textiles industry is poised for strong growth, driven by increasing global demand for sustainable textiles, enhanced government support through export incentives, and the adoption of digital platforms for marketing and sales.

Future Market Opportunities

Growth of Eco-friendly Textiles: Over the next five years, the demand for eco-friendly textiles is expected to surge, driven by consumer preferences for sustainable products. By 2029, it is projected that the Indonesian textile industry will produce over 100 million square meters of organic and recycled textiles annually, responding to increasing demand from both domestic and international markets.

Increased Automation in Textile Manufacturing: In the future, the Indonesian textile industry will experience automation in its production processes. By 2028, it is anticipated that over 70% of textile factories will adopt automated cutting, sewing, and printing technologies, which will enhance production efficiency and reduce labor costs by IDR 10 trillion.
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