JAKARTA – The Indonesian government has been continually implementing the replanting program for oil palm smallholders’ plantations (PSR) as a way to increase productivity and quality of Indonesian palm oil production. The PSR program is also part of the government’s efforts to improve the governance in the palm oil sector.
Since its launching by President Joko Widodo (Jokowi) in October 2017 until 2023, the replanting program has covered a total of 326,678 hectares of oil palm plantations owned by 142,078 smallholders who had received a total fund of Rp9.11 trillion for implementing the replanting program.
Based on the government-sponsored replanting program, during the first year of implementation smallholders can receive the aid fund of Rp30 million per hectare with a maximum plantation size of 4.0 hectares. For the second year and subsequent years, the smallholders can use the people’s business credits (KUR) with a maximum ceiling of Rp500 million and interest rate of 6% per year.
“Nationally, we’ve provided the KUR funds at a total of Rp280 trillion. So, actually there is no reason that this replanting program can’t work well,” Economic Coordinating Minister Airlangga Hartarto said during a ceremony to deliver PSR fund for smallholders in Sialang village of Deli Serdang regency in North Sumatera province on Friday (26/01).
Airlangga has also pushed for the distribution of KUR from state-owned Bank Sumut to the smallholders grouped in Mitra Petani Mandiri cooperative in Deli Serdang. The government has given incentives for smallholders in getting the KUR fund, which is set at Rp25 million per hectare and interest rate of 6% per year.
Airlangga said that smallholders can only be accommodated in the replanting program if their land areas are legally clean and clear and have the certificates of cultivation rights (HGU). The replanting program is expected to help smallholders in increasing their productivity and quality and raising their competitiveness at local and global markets.
“The government is now conducting a study on the oil palm plantation areas considered to have encroached forest areas. Hopefully, it can be resolved this year, so that more smallholders can join the replanting program,” said Airlangga. (*)
Source: sawitindonesia.com
