The Indonesian Filament Fiber and Yarn Producers Association (ApsyFi) assessed that the closure of PT Sri Rejeki Isman Tbk (Sritex) reflects the government's failure to manage the textile and textile product (TPT) industry over the past decade. The cessation of Sritex's operations is considered to weaken the national textile industry ecosystem because this company has a strategic role in the supply chain from upstream to downstream.
ApsyFi General Chairperson, Redma Gita Wiraswasta, highlighted that Sritex has raw material processing facilities such as rayon which have begun to weaken since 2023. In addition, this company is also in the midstream sector which produces yarn and fabric. When this middle section experiences a downturn, the absorption of raw materials in the upstream industry decreases significantly, which ultimately disrupts supply to the downstream sector. The impact of this situation worsens the condition of the domestic textile industry which is already under pressure from various external factors.
One of the main causes of the textile industry crisis is the rampant illegal imports and the circulation of cheap goods that enter without strict regulations. ApsyFi believes that the government has failed to protect the domestic market, which should be the last bastion for the domestic industry. After the Covid-19 pandemic, the textile industry showed signs of recovery. However, with the increasing number of illegal imports and the difficulty of exporting due to global geopolitical tensions, the national textile industry has actually worsened. Sritex is one of the biggest victims of trade policies that are considered not in favor of local industry players.
The impact of this crisis is increasingly visible with the increasing number of layoffs and factory closures. Throughout 2024, more than 60 TPT companies have closed, while layoffs occur almost every week. This condition shows that the resilience of the domestic textile industry is increasingly fragile without effective intervention from the government.
According to ApsyFi, the steps to save the TPT industry are actually quite simple: the government must be serious about eradicating illegal imports and taking firm action against those involved in smuggling goods. Redma emphasized that the government does not need to provide financial incentives or energy subsidies, but rather enforce fair trade rules and eliminate special treatment for imported goods. Action against individuals in the logistics sector, officials, and bureaucracy who collaborate with illegal importers is a crucial step to fix this situation. Tighter regulations and tighter supervision are expected to restore the competitiveness of the domestic textile industry before more companies suffer the same fate as Sritex.