Indonesia ratifies EAEU free trade deal, targets palm oil and textile export gains

Indonesia's Trade Ministry says the newly ratified free trade agreement with the Eurasian Economic Union (EAEU) will open significant new markets for the country's palm oil, coffee, textile and footwear exporters, according to state news agency ANTARA.

Trade Minister Budi Santoso told a working meeting with Commission VI of Indonesia's House of Representatives (DPR) that ratification of the Indonesia-EAEU Free Trade Agreement (IEAEU FTA) would deliver substantial benefits across a range of Indonesian export goods, from palm oil to textiles.

Tariff cuts on more than 90 percent of EAEU lines

Under the agreement, Indonesia secured commitments to eliminate or reduce tariffs on 11,882 tariff lines, equal to about 90.5 percent of the total tariff lines maintained by the EAEU. The bloc comprises Russia, Belarus, Kazakhstan, Armenia and Kyrgyzstan.

Budi said the leading Indonesian export products set to benefit include palm oil and its derivatives, natural rubber, coffee, fishery products, textiles and textile products (TPT), footwear, furniture, machinery and electrical equipment, and wood and wood products.

The agreement was signed on 21 December 2025 in St. Petersburg, Russia. Budi described it as a strategic step to widen Indonesian export access to the Eurasian region, which he said has a population of around 183.7 million and a combined gross domestic product of $3.04 trillion in 2025. He added that the region could serve as a gateway for Indonesian goods into Central Asia, West Asia and Eastern Europe, while strengthening the competitiveness of national firms, particularly micro, small and medium enterprises (MSMEs).

What Indonesia opens in return

As part of the deal, Indonesia will cut tariffs on 10,257 tariff lines, or about 89.9 percent of its own national tariff schedule. Budi said these concessions focus mainly on products that support the needs of domestic industry.

Those commodities include wheat, fertilizer, pharmaceutical products, machinery and electrical equipment, basic chemicals, processed dairy products, and paper and pulp. The two-way structure pairs improved access for Indonesian consumer and commodity exports with lower duties on industrial and agricultural inputs that Indonesia buys from the bloc.

Projected trade and welfare gains

Budi said implementation of the IEAEU FTA is projected to raise the value of Indonesian exports to the Eurasian region to around $2.87 billion to $2.89 billion. The agreement is also estimated to increase Indonesia's welfare by $69.98 million and to lift real gross domestic product by 0.0059 percent.

"This trade agreement is important because it will open wider export market access in Indonesia, improve the competitiveness of national businesses, especially MSMEs, and open a global entry chain through the EAEU as a hub for Indonesian export products," Budi said, as quoted by ANTARA.