The Halal Industry in the Framework of Indonesia-Australia Bilateral Trade Cooperation: A Case Study of IA-CEPA Partnership Dynamics

Ardianta Selasa, September 08, 2026
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FORMOSA NEWS

IA-CEPA Partnership Drives Indonesia and Australia Toward Global Halal Industry Leadership

Bilateral trade cooperation under the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA) offers significant opportunities to strengthen the halal supply chain between both nations. A 2026 study led by Nila Dewi Wahyuningsih from ASMI Surabaya, Aris Pratama from Australia Trade and Investment (AUSTRADE), and Tria Apriliana from Universitas Widyatama investigates how trade frameworks facilitate halal trade. Published in the Indonesian Journal of Contemporary Multidisciplinary Research (MODERN), the research demonstrates how combining Australian raw materials with Indonesian manufacturing transforms both countries into an economic powerhouse for global halal products.

Expanding Horizons in International Halal Trade

The global halal economy has expanded far beyond religious compliance to become a major force in international trade, spanning food, pharmaceuticals, cosmetics, and personal care products. Indonesia represents one of the world's largest consumer markets for halal goods. Conversely, Australia is a premier exporter of certified halal agricultural products, particularly beef and sheep meat.

Since IA-CEPA entered into force in July 2020, two-way trade in goods between Indonesia and Australia has surged, exceeding USD 13 billion. However, fully utilizing this trade agreement for the halal sector requires overcoming regulatory disparities, technical barriers, and complex certification processes between both jurisdictions.

Methodological Approach to Evaluating Trade Policy

Researchers Nila Dewi Wahyuningsih, Aris Pratama, and Tria Apriliana utilized a descriptive qualitative single-case study design. The investigation analyzed secondary data from official government publications, reports from relevant international bodies like the State of the Global Islamic Economy (SGIE), and existing academic literature.

The team applied a Strengths, Weaknesses, Opportunities, and Threats (SWOT) analytical framework. This approach evaluated internal capacities alongside external market dynamics to formulate strategic recommendations for bilateral trade policy.

Key Pillars of the Indonesia-Australia Halal Partnership

The investigation highlights three core dimensions shaping the bilateral halal market:

  • Three Strategic Growth Pathways: IA-CEPA facilitates trade by securing halal supply chains for meat and dairy, expanding halal certification into high-value non-food sectors like cosmetics and pharmaceuticals, and accelerating technical capacity building through initiative programs like Katalis 2.0.
  • Multi-Layered Institutional Frameworks: Operational alignment is supported by a Memorandum of Understanding (MoU) on Halal Product Assurance between Indonesia's BPJPH and the Australian government, the recognition of 12 Australian Foreign Halal Bodies (LHLN), and adherence to the Australian Government Authorised Halal Program (AGAHP).
  • Technical and Regulatory Challenges: Persistent hurdles include technical differences in processing standards (such as pre-slaughter stunning guidelines), bureaucratic delays in facility licensing, and tight compliance deadlines ahead of Indonesia’s mandatory halal labeling enforcement.

Real-World Impact and Industry Implications

The convergence of IA-CEPA trade policy and halal compliance mechanisms delivers substantial economic benefits for businesses, regulators, and consumers. Establishing Mutual Recognition Agreements (MRAs) minimizes duplicate certification costs and streamlines supply chain logistics across borders.

For Indonesian manufacturers, importing zero-tariff Australian agricultural inputs enables cost-effective production of finished halal goods. These manufactured goods can then be re-exported to high-demand markets across the Organization of Islamic Cooperation (OIC) member states, while domestic consumers gain guaranteed quality and religious assurance.

As noted by Nila Dewi Wahyuningsih of ASMI Surabaya, Aris Pratama of AUSTRADE, and Tria Apriliana of Universitas Widyatama, integrating Australian raw supply with Indonesian industrial capacity establishes a resilient value chain capable of dominating the global halal economy.

Author Profiles

  1. Nila Dewi Wahyuningsih, S.E., M.M. is a researcher and academic at ASMI Surabaya, Indonesia, specializing in international trade and halal industry management.
  2. Aris Pratama, S.E., M.I.B. is a trade policy analyst at Australia Trade and Investment (AUSTRADE), with expertise in bilateral trade diplomacy and investment frameworks.
  3. Tria Apriliana, S.E., M.Ak. is a lecturer and researcher in the Faculty of Economics and Business at Universitas Widyatama, Bandung, specializing in Islamic economics and supply chain governance.

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