East Kalimantan Remains Indonesia's Coal Export Hub

RRI.CO.ID, Balikpapan - The Province of East Kalimantan continues to dominate Indonesia's coal sector, accounting for nearly 70 percent of the region's total export value.

According to the Sustainable Welfare Foundation Indonesia (SUSTAIN), strong demand from major markets like China and India triggered a significant rebound in export volumes during the fourth quarter of 2025.

However, this heavy economic reliance has placed the province at the center of a growing national debate regarding the postponement of the coal export duty, originally slated for implementation in early 2026.

SUSTAIN Executive Director Tata Mustasya warned on Monday, March 30, 2026, that delaying this policy causes Indonesia to miss a vital fiscal momentum. With global oil prices surging toward $100 per barrel due to escalating Middle East tensions involving the US, Israel, and Iran, Indonesia faces a potential budget deficit.

Analysis from SUSTAIN highlights several critical fiscal risks facing the national economy. The primary concern is lost revenue, as the delay in implementing coal export duties could cost the state up to IDR 62.9 trillion (USD 3.7 billion) in potential income.

This loss creates significant deficit pressure, representing nearly 10 percent of the total 2026 State Budget (APBN) deficit. Furthermore, the report warns that budget stability is at stake, as the lack of these new revenue sources puts the national deficit at risk of exceeding the critical 3 percent of GDP stability threshold.

The coal industry is currently enjoying "super normal profits" due to unexpected price spikes over the last month. SUSTAIN argues that these windfall gains should be captured through export duties and redirected toward national interests.

"Every day of delay means a lost opportunity to fund the APBN deficit and accelerate the energy transition," said Tata Mustasya, as quoted by Antara.

The foundation advocates for a strategic reallocation of these potential funds, suggesting that coal export levies should serve a broader purpose than simply covering budget deficits.

A significant portion of these revenues could be dedicated to solar energy development, which would strengthen national energy security by building out renewable infrastructure. SUSTAIN also emphasizes the importance of a clean energy transition, arguing that these funds should help shift the national fiscal structure away from extractive sectors and toward sustainable alternatives.

Furthermore, this reallocation would promote long-term fiscal health by creating a more resilient economic framework that is no longer at the mercy of volatile global oil markets.

Despite the planned implementation date of April 1, 2026, the policy remains stalled in cross-ministerial technical discussions. SUSTAIN urges the government to prioritize coordination to ensure these "windfall" profits contribute to the country's long-term energy resilience. ***