Overview

Table: Total Market Size for Healthcare, Unit: USD millions

 Total Market Size = (Total Local Production + Total Import) - (Total Exports)

Source: Indonesian Medical Device Producers Association (ASPAKI) and Global Trade Atlas (GTA) on Connect Trade Data. Average exchange rate of Indonesian Rupiahs to U.S. dollars from the World Bank.
 

Indonesia’s Healthcare Sector 

Indonesia, Southeast Asia’s largest economy, is becoming an important—though evolving—market for U.S. healthcare and medical device companies. The country’s large and growing population, along with increasing healthcare needs, is driving the development of its medical device industry. The government is actively pushing for more local production to reduce its reliance on imports.

Between 2020 and 2025, the medical device market in Indonesia experienced ups and downs. It peaked at $3.59 billion in 2021 during the pandemic, dropped to $1.81 billion in 2022, and is now recovering, expected to reach $2.78 billion by 2025. This rebound presents new opportunities for companies to grow or enter the market.

At the same time, local manufacturing is increasing. Domestic production is set to rise from $2.12 billion in 2020 to $3.37 billion by 2025, showing the government’s push for self-reliance. However, advanced medical equipment is still mostly imported, an area where U.S. companies excel.

Despite high potential, U.S. exports to Indonesia are declining—from $278 million in 2020 to an expected $180 million by 2025. This reflects growing competition and stricter local content rules. Still, Indonesia imports more than it exports, with the import market led by China, followed by the U.S., Germany, South Korea, and Japan.

The country’s trade deficit in medical devices is expected to reach $1.45 billion by 2025, meaning there is still room for foreign companies, especially those offering high-quality, innovative products.

 President Prabowo’s administration is investing IDR 218.5 trillion in 2025 to improve healthcare access, with plans for free checkups, better hospitals, and upgraded infrastructure. These efforts support Indonesia’s long-term vision to become a developed nation by 2045.

The national health insurance program (JKN) now covers over 278 million people, nearly 99% of the population. It has expanded services and rewards better patient outcomes, pushing hospitals to improve quality and efficiency.

As of 2023, the nation had 3,155 hospitals, comprising 1,181 public and 1,974 private facilities. Public hospitals, especially in rural areas, still rely on outdated equipment, while private hospitals are growing and cater to wealthier patients. This creates two distinct markets: public hospitals, which prefer local products through government tenders, and private hospitals, which tend to import higher-end tools.

The TKDN policy (Domestic Component Level) is used by the Indonesian government to promote local manufacturing. Since the 2022 regulation, the share of imports in government e-catalogues has dropped from 92% to 52%. Still, most local production is focused on basic items like gloves, beds, and simple diagnostic tools. High-end equipment—like MRIs, PET-CT scanners, Linacs, ventilators, and surgical robots—continues to come from abroad. By 2025, the Ministry of Health had listed 16,777 locally produced and 56,325 imported medical devices.

Indonesia is also pushing digital transformation. The Ministry of Health is building a national electronic medical records system called SatuSehat, now connected to 98.6% of healthcare providers. Telemedicine is expanding too, reaching 15 million rural residents and increasing the need for digital tools, such as wearable health devices and remote diagnostics. Private companies like Halodoc and Alodokter are helping lead this digital shift, offering virtual doctor visits and online medicine delivery.

Indonesia remains a promising market for U.S. medical device companies—especially those offering advanced technology, willing to build local partnerships, and ready to navigate a changing regulatory landscape. The demand is there. The key is adaptation.

 What U.S. Companies Should Know

• Focus on High-Tech Solutions: There’s a strong need for advanced devices like diagnostic machines and surgical equipment.

• Partner Locally: Working with Indonesian partners or distributors can help navigate local rules and open doors.

• Understand Regulations: The government is tightening rules around local content (TKDN) and product registration, so staying compliant is key.

Leading Sub-sectors

The following sub sectors are among the leading U.S. exports in terms of export value:

• HS 901890: Instruments and appliances for medical, surgical, or veterinary sciences and parts

• HS 382200: Composite Diagnostic or Laboratory Reagents, Other Than Pharmaceutical Preparations

• HS 901920: Ozone Therapy, Oxygen Therapy, Aerosol Therapy, Artificial Respiration or Other Therapeutic Respiration Apparatus; Parts and Accessories

• HS 902214: Apparatus Based on The Use of X-Rays for Medical, Surgical, Or Veterinary Uses, Including Radiography or Radiotherapy Apparatus

• HS 901812: Ultrasonic Scanning Apparatus

Opportunities

In September 2023, Indonesia launched a $4 billion procurement initiative under the Indonesia Health Systems Strengthening Project (IHSS) to modernize its healthcare infrastructure. Co-financed by the World Bank, ADB, AIIB, and IsDB, with the World Bank as the coordinating agency, this ambitious project aims to enhance medical facilities across Indonesia’s 6,500 islands. 

The procurement is structured into three major initiatives:

• SIHREN ($1.8B) – Focused on secondary specialized care.

• SOPHI ($1.1B) – Strengthening primary healthcare services.

• InPULS ($600M) – Enhancing laboratory and diagnostic capabilities.

The Ministry of Health is facilitating this central procurement through 73 competitive bidding packages, encouraging participation from both international and domestic suppliers. Detailed information about these tenders is available on the official IHSS website: http://ihss.kemkes.go.id.

Although Indonesia maintains protectionist policies like local content requirements, its healthcare system still relies on high-tech imports, creating openings for U.S. companies with FDA-certified and internationally respected medical products.

Local partnerships are key for navigating the Ministry of Health’s online registration system and other compliance matters. Moreover, strong technical support and staff training add value in a market that is both price-sensitive and quality-focused.

Opportunities are strong in areas such as:

• Diagnostic Imaging Equipment

• ICU and Patient Monitoring Systems

• In-Vitro Diagnostics (IVD) and Lab Automation

• Telemedicine and Digital Health Platforms

• Surgical Instruments and OR Technologies

Resources

• Ministry of Health https://www.kemkes.go.id/id/home 

• Directorate General of Pharmaceutical and Medical Devices, Ministry of Health https://farmalkes.kemkes.go.id/ 

• Indonesia Health System Strengthening http://ihss.kemkes.go.id

Interested parties may contact Commercial Specialist Pepsi Maryarini at Pepsi.Maryarini@trade.gov