Indonesia and Apple have reached an agreement to lift the country’s ban on iPhone 16 sales, ending a five-month standoff. The deal comes after Apple agreed to increase its investment in Indonesia to $1 billion (roughly Rs. 8,716 crore), sources familiar with the matter told Bloomberg. Indonesia’s Ministry of Industry, which enforces the ban, is expected to sign a memorandum of agreement with Apple this week.
A press briefing will follow, and the ministry aims to issue a permit for iPhone 16 sales as soon as possible, according to insiders, reported Bloomberg.
The Standoff And The Resolution
The dispute began in October when Indonesia blocked iPhone 16 sales, citing Apple’s failure to meet local manufacturing requirements. Apple responded by pledging $1 billion in investment, which President Prabowo Subianto urged his ministers to accept. However, the Ministry of Industry later delayed approval, seeking better terms.
As part of the deal, Apple will invest in training local talent in research and development, aligning with the government’s push for more innovation in the country. However, Apple has no plans to manufacture iPhones in Indonesia. The new R&D efforts will be separate from its existing Apple academies.
While both parties have agreed, past government reversals mean the deal isn’t fully locked in yet.
Apple’s Investment Plan
Beyond the R&D commitment, Apple’s $1 billion package includes:
- A new plant on Batam island to produce AirTags, operated by key supplier Luxshare Precision Industry Co. The facility will eventually handle 20% of global AirTag production.
- A factory in Bandung, southeast of Jakarta, to manufacture other accessories.
- Additional funding for Apple academies, equipping students with tech skills like coding.
- Last week, Indonesia’s Industry Minister Agus Gumiwang Kartasasmita revealed that Apple had also settled a $10 million (roughly Rs. 87 crore) debt for non-compliance with local rules between 2020 and 2023.
A Strategic Win For Both Sides
For Indonesia, the deal is a victory—forcing one of the world’s biggest tech companies to increase its investment and contribute to local development. Previously, Apple had only invested $95 million in the country.
For Prabowo, the agreement boosts his political standing, especially after recent policy U-turns and protests over budget cuts.
For Apple, the deal ensures access to Indonesia’s massive market at a time when sales in China are slowing. While Apple isn’t a top smartphone brand in Indonesia, the country’s 278 million people—more than half under 44 and tech-savvy—make it a market too big to ignore.
