Indonesia’s first halal industrial zone to start development early 2020

JAKARTA – Indonesia’s PT Modern Group will start developing the country’s first halal industrial zone early next year and complete the job in five years, Ignatius Warsito, Deputy Director General for Industrial Region Development at the Ministry of Industry told Salaam Gateway.

The halal zone at Modern Cikande Industrial Estate (MCIE) in Serang in West Java, around 70 kilometers from Jakarta, will be dedicated to halal food and beverages ingredients. The 500-hectare new halal zone will be carved out of the current 3,175-hectare MCIE that was developed by PT Modern Group in the early 1990s.

According to Warsito, the first stage of development of the halal zone will be completed in 2020 and include a halal certification facility with a laboratory, halal waste water treatment plant, and a logistics park.

PT Modern Group will put up 500 billion Indonesian rupiah ($35 million) for the first stage of development on 150 hectares. 

The real estate and property developer estimates total cost of converting and building the 500-hectare halal zone will be more than 1 trillion rupiah.

Modern Cikande is the first industrial estate operator to receive halal industrial estate status and among the first to express interest to build halal industrial zones.

Other planned halal industrial zones are Batamindo Industrial Park, a 17-hectare site for halal cosmetics & pharmaceuticals, Bintan Industrial Park, which is 100 hectares dedicated to halal F&B, and Jakarta Industrial Estate Pulogadung, part of a 433-hectare area planned for a halal logistics hub for F&B, fashion, cosmetics and pharmaceuticals. 

“We started to hold focus group discussions with several industrial estate operators and associations since 2014 to get input from them when we drafted the Ministry Regulations on Halal Industrial Estates,” said Warsito.

“We also held benchmarking exercises and visited Selangor Halal Hub in Malaysia to see critical points needed to make sure there is no contamination and guarantee 100 percent  halal-compliant aspects on an industrial estate,” he added.

Warsito said the impetus to accelerate the construction of halal industrial zones is in accordance with the upcoming deadlines for the gradual phase-in of mandatory halal certification and labeling for products that are halal, starting with food and beverages from October this year.

Accordingly, Modern Cikande will focus on F&B sectors first and is expected to help small- and medium-sized enterpirses (SMEs).

PT Modern Group will first build a 1,250-square meter building due for completion early 2020 that can be used by SMEs as a halal storage facility. 

“In general, SMEs are still struggling to get halal certification and recognition from international halal networks we are referring to, such as Pakistan National Accreditation Council. Although from the laboratory facility perspective we already have back-up from Indonesian state-owned body Succofindo, for example, but SMEs still need more help including from industrial estate operators,” Warsito said. 

In addition, there will be facilities for tenants of the halal industrial estate, including halal product certification services, auditing, and laboratories for tests by halal guarantee institutions (LPH) appointed by new state-run halal authority and certifier BPJPH.

BPJPH will take over from Muslim clerical body Majelis Ulama Indonesia as Indonesia’s national-level, and only, halal certifier on October 17.

“It’s a privilege for tenants as they don’t have to wait in line to process their halal product certification, as we provide an in-built halal certification facility,” said Warsito.

Any existing or new industrial estate can be converted in part or whole to become halal industrial zones so long as they meet requirements set by the Ministry of Industry, Ministry of Religious Affairs, LPPOM MUI (for human capital aspects of halal auditing), BPJPH, and the National Accreditation Committee (KAN).

Among the requirements are that halal zones must have Shariah-compliant industrial estate management,  laboratories for halal testing, halal water treatment, auditors for halal product guarantee, and they must be physically separated from any non-halal areas to ensure non-contamination.

“When any industrial estate operator requests for halal industrial estate status, a team consisting of  MUI, BPJPH, ministry of religious affairs and KAN will do inspections and assess from the technical aspects, then the team will give us recommendations as to whether they meet the requirements. Halal status will be announced within five days at earliest after we receive the recommendation from the team,” said Warsito. 

($1 = 14,115.9 Indonesian rupiah)

(Reporting by Yosi Winosa; Editing by Emmy Abdul Alim [email protected])

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