How East Java’s Industrial Estates Foster Business Success

East Java’s industrial landscape is undergoing a significant transformation driven by the burgeoning growth of industrial estates. These strategically developed zones offer a compelling proposition for manufacturers, with streamlined infrastructure, shared resources, and a supportive business environment.

This article will explore the primary drivers behind this increase and examine the impact of industrial estates on East Java’s economic development and future potential.

The Rise of Industrial Estates in East Java

East Java Province, covering a total area of 31,784 hectares, is poised to expand its industrial zones to meet the growing investment demands in manufacturing over the next few years.

Currently, only around 4,097 hectares are utilized as industrial estates. Notable areas include the 1,761-hectare Java Integrated Industrial Port Estate (JIIPE) and the 140-hectare Gresik Industrial Estate (KIG).

The government and developers are focused on establishing more industrial estates. Key developments include the 4,300-hectare North Gresik Agroindustrial area, 285 hectares of Salt Laka, an 800-hectare industrial zone in Ploso, Jombang, and a 10,000-hectare area in Mojokerto.

What is An Industrial Estate?

As defined by Indonesian Government Regulation No. 24 of 2009 (Chapter 1, Article 1, part 2), an industrial estate is a designated zone precisely planned for industrial activity. 

Licensed industrial estate companies develop and manage these zones and offer comprehensive support facilities and infrastructure to streamline your operations.

How Does An Industrial Estate Work?

Industrial estates boost efficiency and productivity while facilitating government regulatory and supervisory processes. Their role is pivotal in the development and reinforcement of the industrial sector in Indonesia.

These estates, consisting of numerous factories and manufacturing units, have comprehensive supporting facilities to streamline production and industrial activities. Prominent industrial estates in Indonesia include those in Batam, Bekasi, Cikarang, and Karawang, among others currently under development.

Although most industrial estates are located on the island of Java, the government has been increasingly proactive in establishing and expanding industrial estates in various regions, particularly in eastern Indonesia. This initiative aims to promote balanced development and stimulate national economic growth.

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Industrial Estate Regulation in Indonesia

In line with Article 14 of Law Number 3 of 2014 on Industrial Affairs, the government promotes the accelerated and balanced spread of industrial development across Indonesia through industrial estate development.

This development strategy aims to integrate environmental considerations, improve investment appeal, and foster high and competitive economic growth.

Government regulations cover various aspects of industrial estate development, including the roles of different levels of government, development initiatives, land use rights, management obligations, and standards.

These regulations aim to create an organized and legally compliant framework for establishing and operating industrial estates, ensuring that they contribute effectively to national economic growth while maintaining environmental and social sustainability.

Why are Industrial Estates Important to Businesses in East Java?

Industrial estate can be designed to integrate complementary services and features that benefit the space’s businesses.

Ports within these estates provide access to bringing commodities and finished products to major industrial centers for distribution. Cranes and other heavy lifting equipment at the park facilitate cargo transfer to trucks and railcars.

Moreover, warehouses within the industrial estates offer storage options for the cargo. Manufacturers in industrial estates with port access can efficiently obtain the materials necessary for their production processes.

What is the Function of the Industrial Estate in East Java?

Industrial estates in East Java provide a wide range of benefits for businesses, encompassing several key advantages. These advantages include:

Impact on Surrounding Areas

Proper planning allows the industrial estate’s impacts to be directed and utilized positively through job creation, local economic growth, and infrastructure improvements in the surrounding areas.

Land Procurement and Marketing Business

Industrial estates can be utilized by both the government and the private sector to acquire land for industrial development and for marketing the available land within the estates to potential investors and businesses.

Business Facilitation

Industrial estates can facilitate business for companies operating within them. This might include incentives or subsidies, such as simplified licensing processes, government-provided infrastructure facilities, or other supportive policies.

What are the Best Facilities for An Industrial Estate in East Java?

Due to their wide range of services and amenities, industrial estates provide the perfect business environment for many companies. These advantages include:

Sustainable and Reliable Utilities

Industrial estates provide sustainable and reliable utilities, such as a consistent electricity supply, which supports productivity goals by ensuring continuous operations.

Park Security and Protection Systems

Industrial estates are equipped with state-of-the-art security and protection measures. This includes a dedicated and responsive security force that works diligently to prevent theft, vandalism, and other potential risks within the industrial park.

Road Infrastructure

Extensive and robust road infrastructure within industrial estates is crucial in alleviating traffic congestion and facilitating seamless transportation and distribution activities.

Eco-Friendly Environment

An eco-friendly environment, which includes sustainable landscaping, renewable energy usage, and efficient waste management, helps to make the area more resistant to natural calamities such as floods, hurricanes, and wildfires. 

This resilience contributes to the continuity and stability of business operations, ensuring minimal disruption during adverse environmental events.

Support Facilities

Convenience is a crucial advantage of industrial estates, which often include mixed-use locations with facilities such as housing, hospitals, restaurants, banks, and commercial outlets.

What is the Biggest Industrial Estate in East Java?

East Java is one of Indonesia’s provinces with the most industrial estates. These industrial hubs are strategically located in various areas. Those are:

Industrial Hubs	Description	Location
Gresik Industrial Area (KIG)	Covers 135 hectares, with 44 hectares for infrastructure and 91 hectares for commercial use.	Gresik
Tuban Industrial Area (KIT)	Operated by PT GIA, expanding the Gresik Industrial Area.	Tuban
Ngoro Industrial Park (NIP)	Developed by PT Dharmala RSEA Industrial Estate, a joint venture between Intiland Group (Indonesia) and RSEA Engineering Corp. (Taiwan).	Ngoro, Mojokerto
Java Integrated Industrial and Ports Estate (JIIPE)	Integrates deep-sea ports, industrial zones, and residential areas over 3,000 hectares in Gresik.	Gresik
Maspion Industrial Estate (MIE)	One of East Java’s largest, located at KM 25 on Manyar Road, Gresik.	Gresik
Sidoarjo Rangkah Industrial Estate (SiRIE)	Spans 200 hectares and serves as a strategic hub for industries and warehousing.	Sidoarjo
Safe n Lock	Largest industrial and warehouse complex in East Java, covering 307 hectares at KM 5.5 of the Eastern Ring Road, Sidoarjo.	Sidoarjo
Pasuruan Industrial Estate Rembang	Managed by PT SIER in Pasuruan, covering 563 hectares.	Pasuruan
Surabaya Industrial Estate Rungkut	Managed by PT SIER, covering 335 hectares in Surabaya.	Surabaya
Sidoarjo Industrial Estate Berbek	Managed by PT SIER, spanning 87 hectares in Sidoarjo.	Sidoarjo

Unlock East Java’s Industrial Potential with InCorp

The industrial estate sector in East Java holds promise due to strong government support. InCorp Indonesia (an Ascentium Company) offers comprehensive services to facilitate business registration and expansion. 

We provide a comprehensive suite of services to streamline your entry and growth:

• Company Registration: Our experts ensure a smooth and efficient launch, minimizing complexities.
• Business Process Outsourcing: Our Business Process Outsourcing (BPO) service tackles bureaucratic hurdles, including tax compliance, accounting, payroll, and HR.

Focus on your core business while InCorp handles the rest. We’ll help you navigate the regulatory landscape and optimize operations for success. Fill out the form below to unlock the full potential of East Java’s industrial estates.