Indonesia’s online driver community is urging the government to redirect fuel subsidies toward electric motorcycles, highlighting a growing policy gap between energy transition ambitions and current subsidy frameworks.
The Online Taxi Driver Association (Garda Indonesia) has called for a comprehensive study on reallocating part of fuel (BBM) subsidies toward electric motorcycle incentives, specifically targeting motorcycle ride-hailing drivers, who remain heavily dependent on subsidized fuel but are largely excluded from existing reform plans.
The proposal comes amid rising geopolitical tensions involving Iran, the United States, and Israel, which the association warns could disrupt global oil supply chains, threaten energy security, and put additional pressure on Indonesia’s economy.
A strategic energy shift
Garda Indonesia Chairman Raden Igun Wicaksono said any subsidy transition must be supported by accessible financing schemes, including motorcycle trade-in programs and low-interest loans.
He emphasized that motorcycle ride-hailing drivers are a critical component of Indonesia’s MSME ecosystem and play a central role in maintaining efficient urban mobility.
“With around 7 million online drivers in Indonesia, redirecting fuel subsidies toward electric motorcycles would be a targeted measure to reduce oil imports, cut emissions, and strengthen national energy security,” Igun said, as quoted by Bloomberg Technoz, on Tuesday, March 24, 2026.
The association is urging the government to move quickly from study to implementation, arguing that such a policy would not only provide a buffer during potential fuel supply shocks but also support the long-term development of Indonesia’s gig economy.
Earlier subsidy reform plans
In late 2024, Energy and Mineral Resources Minister Bahlil Lahadalia proposed converting part of the fuel subsidy into Direct Cash Assistance (BLT) under a “blended” system.
He stressed that the plan does not involve eliminating subsidies, but rather improving their targeting.
“All of it remains subsidized; however, some allocations may not be well targeted,” Bahlil said.
Under the proposal, fuel subsidies would primarily be allocated to public transportation vehicles with “yellow plates,” while privately registered “black plate” vehicles, including most motorcycle ride-hailing drivers, would be excluded.
“Should this type of transport receive subsidies? We will calculate it carefully. What is clear is that subsidies will be managed prudently,” he added.
Bahlil also indicated that some motorcycle ride-hailing drivers could still qualify for BLT support, depending on eligibility criteria. However, no final policy decision has been announced.
No incentives for electric motorcycles in 2026
Despite growing calls for electrification, the government has confirmed that no incentives for electric motorcycles will be provided in 2026, extending the policy stance from 2025.
Industry Minister Agus Gumiwang Kartasasmita said in January that the government would not roll out subsidy support for electric two-wheelers this year, effectively ending months of speculation among industry players and consumers.
