Ervana Trikarinaputri, Jakarta – Chairperson of the National Economic Council (DEN), Luhut Binsar Pandjaitan, signaled a plan to eliminate subsidized fuel by 2027. He proposed a unified fuel pricing system to President Prabowo Subianto.

"I have conveyed this to the President, and maybe within two years, we can achieve a unified price," said Luhut during the Economic Outlook 2025 event held in the SCBD area, South Jakarta, on Thursday, February 20, 2025. "There will no longer be subsidies for materials such as fuel oil, diesel, or anything else."

The former Coordinating Minister for Maritime Affairs and Investment during the 7th President Joko Widodo's administration explained that subsidies would be directly distributed to people who truly qualify. "Subsidies will be given to those who qualify for them," he said.

This approach, he opined, would result in savings for the state budget up to trillions of rupiah. "So, in my opinion, that is the best option, we can save billions and billions of dollars," Luhut added.

Luhut also believed that artificial intelligence (AI) can also be used to help distribute energy subsidies.

"We have the technology now. AI is very good, so Pertamina can immediately identify whether a car with this license plate qualifies to receive this type of gasoline. This car qualifies, while that one does not, or something similar," he said. "I think this will be successful."

Earlier in January, Minister of Energy and Mineral Resources (ESDM) Bahlil Lahadalia stated that a new scheme for the distribution of subsidized fuel would be announced soon. He also mentioned three formulations for the distribution of energy subsidies.

First, shifting fuel oil subsidies to direct cash assistance (BLT). Second, providing subsidies for public facilities. Third, implementing a scheme involving price increases for certain subsidized goods.

However, in mid-January, Bahlil stated the opposite. A new scheme for subsidized fuel distribution will not be announced soon due to unclear data from the Central Statistics Agency (BPS) regarding potential subsidy recipients.

The Chairperson of the Golkar Party noted that the data on potential recipients was still overlapping. Yet, targeted subsidy distribution is crucial as it should be directed to those who are eligible to receive it. "So, we need to be careful with the data," he said.

– Riri Rahayu contributed to the writing of this article.

Source: https://en.tempo.co/read/1978328/luhut-suggests-president-prabowo-remove-subsidized-fuel-in-202