Agricultural industry requires fiscal and monetary support

Selasa, 07 Februari 2012 | 07:45

The government is urged to improve its role in formulating fiscal and monetary policies for boosting the growth of local agricultural-based industry.The development of national food security should be started from appropriate policies from the government, revealed by Head of Steering Council at Jakarta Food Security Summit Franky Widjaja.

The policies must be able to provide a solution for issues on land and financial access becoming main obstacles for primary industry development in Indonesia.

By implementing appropriate financial policies, the interest of investors in the agricultural sector will jump leading to industrialization of downstream sector and to national food security basis in the end.

The financial policies include support for disbursement of long-term loan, fiscal incentives, strategy of stable off-take price and insurance provision dealing with climate change.

So, the government has a challenge to find out a right scheme of fiscal and monetary in order to bolster the loan disbursement in the agricultural sector particularly for small-scaled farmers and fishermen.

Without economic scale, the commodity production from the agricultural sector will not be stable as small farmers will replace commodity planted following the price movement.

Public-private partnership

Trade Minister Gita Wirjawan said the government had announced an initiative partnership on Indonesia Sustainable Agriculture (PISAgro) as a scheme of public-private partnership to achieve food security.

The partnership is expected to increase agricultural production to 20%, while cutting carbon emission and poverty level in the similar percentage.

General Chairman of Kadin Suryo Bambang Sulisto expects Jakarta Security Summit to create a benchmark for development of seven-agricultural commodities-based industries. (t01/msw)

By Demis Rizky Gosta