President Prabowo Subianto has reminded coal mining companies that hold special mining business permits (IUPK) that they are required to carry out downstream processing, or hilirisasi, according to a report by Kompas.com.
The statement, published on Tuesday, August 4, 2026, reinforces the government's position that companies benefiting from IUPK permits cannot simply export raw coal. Instead, they must invest in domestic processing facilities as part of Indonesia's broader industrial strategy.
Kompas.com reports that the reminder applies specifically to coal firms that have received IUPK permits from the government. The policy is part of an ongoing push by the administration to move the country up the value chain, ensuring that natural resources are processed domestically rather than shipped abroad in unprocessed form.
The announcement comes amid a series of directives from Prabowo on energy and mining issues. Other Indonesian outlets have covered related instructions, including a ban on raising prices for Pertalite and diesel fuel, and an order for Energy Minister Bahlil Lahadalia to resolve power outages in Kalimantan. These reports suggest the government is tightening oversight across the energy sector.
For coal companies holding IUPK permits, the message is clear: compliance with downstream processing rules is not optional. The government's focus on hilirisasi is expected to continue, with further enforcement actions likely in the coming months.
