JAKARTA, Around 120 Chinese fishing vessels will begin operating in Indonesian waters next year under a new regulation expected to boost the country's fish processing industry.

Under the new regulation, foreign fishing vessels will only be allowed to operate in Indonesian waters if they have fish processing plants to process their fresh fish locally.

The 120 vessels will supply fresh fish to fish processing company PT Dwikarya Reksa Abadi, a joint venture between Chinese and Indonesian partners.

PT Dwikarya has submitted an application for a business license to the Capital Investment Coordinating Board (BKPM) with a planned investment of Rp512.55 billion (US$56.8 million).

The business license now being processed by BKPM is needed before the Ministry of Maritime and Fishery can issue an operating license, chief spokesman of the ministry Saut P. Hutagalung said.

Under the old fishery agreement, most foreign fishing vessels export their production of fresh fish to their respective countries causing difficulty for local fish processing factories in securing raw material.