Nickel Industry: Permits for EV‑Focused Investments in Indonesia

As the global demand for electric vehicles (EVs) accelerates, the nickel industry is poised for significant growth, making it a key player in the clean energy transition. Indonesia’s significant role in this industry makes the potential for growth immense and promising. 

Indonesia imposed a strict nickel export ban to move up the value chain, encouraging foreign investment in nickel smelters and local processing. However, the permitting process for industry investors is still complex.  

Navigating the nickel industry in Indonesia requires a clear understanding of the existing legal framework and available investment incentives. 

Licensing Landscape for Nickel Sector Investors 

The proper permits are crucial for entering Indonesia’s nickel industry, particularly for smelting and electric vehicle (EV) projects. Recent legal reforms have changed the licensing process. 

Previously, companies needed a Special Mining Business License (IUP OPK) from the Ministry of Energy and Mineral Resources (MEMR). Following Law No. 3 of 2020 and Government Regulation No. 96 of 2021, the licensing responsibility has moved to the Ministry of Industry (MoI), which issues the Industrial Business License (IUI). 

Risk-Based Licensing Classification 

Indonesia’s licensing system now operates based on business scale and risk level, as defined by the KBLI 2020 (Indonesian Standard Business Classifications): 

If your business mines and smelts nickel (Integrated)

• High risk: Requires a full Industrial Business License (IUI) 
• KBLI Code: 07295 

If your business only smelts/refines (No mining)

• Micro/Small: Low risk → Needs only NIB  
• Medium: Medium risk → Needs a Standard Certificate 
• Large: High risk → Requires an IUI 
• KBLI Code: 24202 

Foreign Investment Permissions (PMA Companies) 

Indonesia actively welcomes foreign investors in the nickel industry through clear policies and incentives from Presidential Regulation No. 49/2021: 

• 100% foreign ownership allowed 
• Minimum investment is IDR 10 billion per project (excluding land/buildings)

READ MORE:

• EV Motorcycle Imports into Indonesia: Key Steps & Preparation Guide
• How to Open an Electric Vehicle Charging Station in Indonesia
• The Investment Opportunity for an Electric Vehicle Ecosystem in Indonesia

Opportunities for Foreign Investment in the EV‑Nickel Ecosystem 

Indonesia’s nickel industry is among the most promising destinations for foreign investors looking to enter the electric vehicle (EV) supply chain. With government-backed downstream policies, the country has opened significant pathways in nickel smelters, battery materials, and EV component production. 

Nickel Smelting and Refining 

• With the nickel export ban, all raw nickel must now be processed locally, driving demand for smelters. 
• 100% foreign ownership is allowed, making Indonesia an ideal location for long-term smelting investments. 

Battery-Grade Nickel Production 

• The surge in global EV demand is boosting interest in high-purity nickel sulfate, an essential battery ingredient. 
• Investors can partner with local players or establish wholly foreign-owned facilities in nickel processing zones. 

Integrated EV Ecosystem 

• Several industrial parks (like those in Morowali and Weda Bay) are hubs for nickel factory projects linked to global EV brands. 
• These zones offer infrastructure, tax incentives, and faster licensing. 

Green & Sustainable Nickel Projects

• As ESG (Environmental, Social, and Governance) standards tighten, Indonesia encourages sustainable operations. 
• ESG advisory from InCorp helps investors align with international standards and local compliance laws. 

Government Support & Incentives 

• Indonesia’s Positive Investment List and simplified risk-based licensing make it easier to launch EV-aligned nickel operations. 
• The government’s active promotion of key sectors like battery production and smelting clearly indicates its support and encouragement of investors in the nickel industry.

Why Now is the Right Time to Invest in Indonesia’s Nickel Industry 

As Indonesia strengthens its position in the global nickel industry, investors must understand that now is the prime window for investment, especially in EV-aligned sectors like smelting, battery production, and refining.  

However, timing and compliance are critical with stricter regulations and growing ESG demands, and investors must be well-informed and prepared. Partnering with a trusted local expert like InCorp Indonesia (an Ascentium Company) can simplify the process from day one. 

InCorp Indonesia is a leading business solutions provider, offering a wide range of services to help investors navigate the complex regulatory landscape and establish a successful presence in the country. Here’s how InCorp Indonesia can assist you: 

• Secure Your Business License Faster: InCorp guides investors through Indonesia’s risk-based licensing system, from basic NIB to full Industrial Business Licenses (IUI). 
• Ensure ESG Compliance: As global ESG standards tighten, InCorp helps you build sustainable, regulation-ready mining and smelting operations. 

You can safely, efficiently, and sustainably unlock Indonesia’s nickel industry’s full potential by filling out the form below.

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