Indonesian medical device industry leaders are calling for an overhaul of healthcare procurement governance, arguing that current systems must prioritize product quality and domestic manufacturing sustainability over budget-focused purchasing. The industry push follows recent government austerity measures that have tightened regional spending, complicating the procurement of essential medical equipment across the archipelago.
The Indonesian medical device industry is currently experiencing significant growth, with Health Minister Budi Gunadi Sadikin reporting that the sector expanded by approximately 12 percent year-on-year, outpacing the growth of the broader national economy.
Industry Concerns Over Procurement Governance
At a discussion held during Health Ecosystem Week 2026 at Sebelas Maret University, leaders from several industry associations emphasized that the current procurement framework requires urgent evaluation. Kartono Dwidjosewojo, chairman of the Indonesian Medical Devices and Laboratory Companies Association (Gakeslab Indonesia), stated that distribution is an essential element in ensuring medical devices reach communities in accordance with quality standards.
Other industry figures, including Randy H. Teguh of the Indonesian Medical Device Ecosystem Development Association (HIPELKI), noted that while companies support tax compliance, there is a pressing need for policies that foster a stable business environment. These representatives argue that balanced governance is necessary to allow companies to grow while simultaneously supporting public healthcare.
The tension between government austerity and the need for high-quality medical infrastructure highlights a classic trade-off in public health policy. When budgets are constrained by central mandates—such as the funding of priority programs like the free nutritious meal initiative—the resulting reduction in regional spending capacity can inadvertently compromise the long-term maintenance and modernization of hospital equipment, potentially impacting patient safety outcomes.
Strengthening Domestic Capabilities
To reduce reliance on imported goods, the Indonesian Medical Device Manufacturers Association (ASPAKI) has urged the government to support the development of local raw materials and manufacturing technologies. Chairman Imam Subagyo stated that enhancing domestic self-sufficiency is a critical path forward for the sector.
This perspective is supported by academic research, with Fitria Rahmawati of Sebelas Maret University noting that the Covid-19 pandemic underscored healthcare as a strategic component of national sovereignty. She called for an integrated ecosystem that connects research, industry, and market needs.
What May Happen Next
The government is preparing to use the 2026 Economic Census to gather comprehensive data on investment, employment, and business activities within the healthcare sector. This data collection effort, which Health Minister Budi Gunadi Sadikin has asked all healthcare stakeholders to support, is likely to serve as the foundation for future policy adjustments regarding procurement and industrial support.
If the census reveals a significant gap in domestic manufacturing capacity, the government may face increased pressure to refine its procurement mechanisms to favor local firms. Alternatively, if fiscal constraints remain tight due to ongoing austerity measures, regional governments may continue to struggle with the maintenance and calibration of existing equipment, as highlighted by Deviatri Syam of the Association of Indonesian Medical Gas Installers (AIGMI).
Frequently Asked Questions
Why are industry leaders calling for changes to procurement?
Leaders argue that purchasing decisions currently prioritize budget efficiency too heavily, which can negatively impact product quality, patient safety, and the sustainability of domestic manufacturers.
How has government spending affected the medical device industry?
President Prabowo Subianto’s austerity measures, which cut transfers to regional governments to fund national priority programs, have narrowed the spending capacity of regional authorities for healthcare services and equipment procurement.
What is the purpose of the 2026 Economic Census for this sector?
The government plans to use the census to gather comprehensive data on business activities, investment, and employment to better understand and capture the economic contribution of healthcare-related industries.
How do you believe the balance between national austerity and local healthcare infrastructure investment should be prioritized?
