Indonesia Records Rp51 Trillion in Energy Subsidies and Compensation
Reporter
March 12, 2026 | 09:02 pm
TEMPO.CO, Jakarta - The realization of Indonesian government subsidy and compensation spending reached Rp51.5 trillion until February 28, 2026. According to Deputy Finance Minister Suahasil Nazara, the amount is equivalent to 11.5 percent of the total budget for subsidies and compensation in the 2026 State Budget (APBN).
"The realization of subsidies and compensation is influenced by fluctuations in the ICP (Indonesian Crude Price), depreciation of the rupiah exchange rate, as well as the increase in the volume of fuel, LPG, and electricity," Suahasil said during a press conference on the 2026 State Budget in Jakarta on Wednesday, March 11, 2026.
He stated that out of the total realization, subsidy spending amounted to Rp7.4 trillion, while compensation payments reached Rp44.1 trillion. This year, the government also began making monthly energy compensation payments. This policy is carried out by positioning the State Budget as a shock absorber to maintain people's purchasing power amid global energy price volatility.
According to Suahasil, global geopolitical dynamics are also potential factors that could trigger an increase in world oil prices and raise the need for energy subsidies. Nevertheless, the government considers that Indonesia has experience in dealing with energy price spikes, including during the global energy crisis due to the Russia-Ukraine conflict in 2022.
In addition to maintaining energy price stability, the government also ensures the availability of various subsidized goods for the public. Data from the Ministry of Finance shows that the volume of subsidized commodity distribution has increased in 2026 compared to the previous year.
The distribution of subsidized fuel reached 1,647,900 kiloliters, an 11.2 percent increase from the 2025 realization of 1,482,200 kiloliters. Meanwhile, the distribution of 3-kilogram LPG reached 740.9 million kilograms, a 7.5 percent increase from the previous year's 689.1 million kilograms.
The number of subsidized electricity customers also increased from 41.8 million customers in 2025 to 42.7 million customers in 2026, an increase of around 2.2 percent.
In the agricultural sector, the distribution of subsidized fertilizer grew by 16.6 percent, increasing from 1.2 million tons in 2025 to 1.4 million tons in 2026.
Additionally, the number of People's Business Credit (KUR) recipients increased from 500,000 in 2025 to approximately 800,000 this year, a 42.5 percent increase.
Suahasil confirmed that the government will continue monitoring global energy prices and rupiah exchange rates to ensure subsidy and compensation policies maintain economic stability and protect people's purchasing power.
Read: ESDM Deputy Minister: Indonesia's Fuel Reserves Sufficient for 30 Days
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