Rabu, 09 Juni 2010

A Cuban Model slower, organic farming – Indonesia

A Cuban Model slower, organic farming – Indonesia

Review to state budget 2010, the first quarter (from APBN 2010 to APBN-P 2010)

Riza V. Tjahjadi
biotani@gmail.com, biotani2004a@yahoo.com

The government's ambitious targets for the development of organic agriculture, it turns out, losing faster than the reality of the absorption of chemical fertiliser subsidies. Urea fertiliser is the fastest and largest in the absorption of fertiliser subsidy in the state budget in the first quarter 2010; was followed by absorption of SP-36 fertiliser, and ZA. Organic fertilisers instead reached only about a third of the target; see table: Fertiliser’s subsidy by March 2010 yet absorbed or SUBSIDI PUPUK S/D MARET 2010 (TIDAK TERSERAP). For information, the first quarter of implementation of the 2010 state budget was the planting season in most of rice fields in the country. So, imagine how much effort government to recover the soil fertility of paddy land. Therefore not surprising, as consequently, the minister of agriculture proposed budget reallocation on cattle granting package and organic fertilisers processing unit shifted to soil fertility improvement and organising direct assistance fertilisers to farmers. In sum, the development of the state-driven organic agriculture through organic fertiliser subsidy was very slow motion in this period.

More contrast illustration, the ministry of agriculture has set projection target the needs for organic fertiliser in 2010 totally 11.9 million tons which consisted of 8.0 million tons for food crops (rice, maize, soybeans, groundnuts, mungbean, cassava and sweet potatoes), and 1.5 million tons for estate crops, and 0.9 million tons for horticultures (fruits, vegetables, herbals, floricultures, included fungus, “lumut” or moss-grown, water-type plants, etc.), 0.5 for animal husbandry, and 1.5 million tons for fisheries. Moreover the need for making RPPO, a house for processing organic fertilisers will be 200 units in 2010. All of the projections above written down in a draft of Strategic Planning of the Ministry of Agriculture 2010-2014 produced by the ministry of agriculture in 30 December 2009.

Hope, then, non-state parties (private companies, NGOs, and farmers) keeps move forward… As reported, for one of illustrations, …If the company succeeded to build 10,000 units of small-scale organic fertiliser factory that will cost Rp 3.5 million, which it will absorb 10,000 workers whilst adds the cow population around 300,000. Thus, fertiliser type will be more varied and the farmer can self-produce organic fertilizers… (Suara Karya: Fertilizer Subsidy Will be Decreased to Reduce Misuse, n.d., 2009 in Tjahjadi: Fertilising soil organically, a slow track with turbulence period to Cuban Model?).

Read, also previous posting: Minggu, 10 Januari 2010
Fertilising soil organically, a slow track with turbulence period to Cuban Model? Indonesia; A review with focus to the state Budget. Jakarta, 10 Januari 2010

Amount the state subsidy increased
In the approval APBN-P 2010 or revision version the government and Parliament agreed on the amount of Central Government Expenditures amounted to Rp781.5 trillion and Transfer to Regions amounted to Rp344.6 trillion. Entire amount was agreed Expenditures amounted Rp1.126 trillion or 18% of GDP, increased by Rp77.1 trillion from the state budget in 2010. One source of change in the state budget was spending on energy subsidies included subsidies of gasoline, LPG and biofuel (BBN, bahan bakar nabati) to Rp88.9 trillion from the state budget 2010 (APBN 2010) only Rp68.7 trillion. Other Energy Subsidies is Electricity, where in APBN-P 2010 are Rp55 trillion or an increase compared to 2010 state budget (APBN 2010) which only Rp37.8 trillion. For non-energy subsidies, in the APBN-P 2010 or revision version state budget in 2010 amounted to Rp57.3 trillion or an increase compared to 2010 state budget which is only Rp51.3 trillion. Non-energy Subsidy in APBN-P 2010 or revision version increased was mainly due to the increase of food subsidies, fertilisers subsidies and seed subsidies. Food subsidies amounted to Rp14.0 trillion from previous state budget 2010 only Rp11.4 trillion. Fertiliser subsidies amounted to Rp18.4 trillion in the state budget revision 2010 increased compared to the previous state budget 2010 that only 14.8 trillion. Seed subsidies also increased to Rp2.3 trillion in the state budget 2010 revision version (APBN-P 2010) compared to only Rp 1.6 trillion to the state budget 2010.

The state budget documents in APBN-P 2010, the rupiah set Rp. 9.500. Meanwhile in APBN 2010 set Rp. 10 000, -/US $ this figure is lower than USD. 500/US $ when compared with APBN-P 2009. Nevertheless according Dr. Harry Azhar Azis MA (n.d.) within a period of five years (2005-2009), the rupiah depreciated by up to 22%.

Fertiliser Subsidy Policy
Fertiliser subsidy in 2010 amounted to Rp14.8 trillion, consisting of: of chemical fertiliser price subsidy of Rp11. 3 trillion, the direct assistance of chemical fertiliser to farmers (BLP) Rp1.6 trillion, Organic Fertiliser Processing Unit Rp105. billion, Cattle granting Rp250 billion, Less paid the previous year of chemical fertiliser Rp1.5 trillion. Government put priority to sufficient supply of required gas companies in the domestic of chemical fertiliser producers in order to maintain food security. The government guarantees the price of gas to meet the needs of the domestic of chemical fertiliser producers in order to maintain food security. Local governments were given the authority overseeing the distribution of subsidised chemical fertilisers through the mechanism of the farmer groups’ Definitive Plan Needs (RDKK)

Government guarantees the availability of chemical fertilisers, according the Coordinating Minister on Economic Hatta Rajasa, because monitoring of the provision of subsidies is now good. Seepage of the distribution of fertilisers has been able to overcome. Previously, fertiliser subsidies are often missed-on-target to the wrong parties. "Now we give subsidies to farmers who have the right," he explains.

According to Hatta, total national requirement of urea fertiliser subsidies and non-urea approximately 11 million tons. While the subsidy for urea fertiliser for approximately 6 million tons. However, it is planned realization of the fertiliser subsidies would be reduced. "Because farmers can make savings," he said. Hatta also explained about the continuity of gas supply for chemical fertiliser industry. To overcome the gas supply, the government plans to build new fertiliser plants. "In the area around the waters of Kaltim (East Kalimantan) was added to the new fertiliser plants, then we will also build a new fertiliser plant in Donggi-Senoro," Hatta said. For fertiliser company whose contract with the gas company will be terminated, according to Hatta, still have extended his contract for maintaining gas supplies (Koran Tempo Thursday, March 25, 2010)

Seed Subsidy (2010): Rp1. 6 trillion
Supporting national food security programs, and provides quality seeds at affordable prices are the main policy. Agricultural subsidies (fertilsers, seeds, credit) can be prepared and routed directly to subsidies paid to farmers without going through to the product. Planned for 2010 will be conducted pilot projects in 10 provinces beforehand using smart cards or coupons. Ministry of Agriculture is preparing schemes regarding the provision of fertiliser subsidy will be given to farmers. This scheme is expected to take effect in 2011. Ten provinces are North Sumatera, South Sumatera, West Jawa, Central Jawa, Yogyakarta, East Jawa, Bali, West Nusa Tenggara, South Kalimantan and South Sulawesi.

10 sources, 10 problems
Minister of Agriculture Suswono, in the written statement received by okezone.com, in Jakarta, Saturday (06/02/2010), this year's funding for agricultural development was obtained through 10 sources – almost all depends to the state budget. The first funding source was State Revenue Expenditure Budget (APBN) Agriculture (sectoral) Rp8 2010, 03 trillion (which amounted to 81.24 per cent is allocated in the region). Secondly, through the Special Allocation Fund (DAK) agriculture Rp1, 52 trillion. Third, fertilizer subsidies Rp14, 75 trillion. Fourth, seed subsidy Rp1, 56 trillion. Fifth, the revitalization of the cocoa Rp0, 5 trillion. Sixth, Credit for Cattle Breeding Business (KUPS) with a credit limit of Rp1, 81 trillion. Seventh, the Credit for food security and energy (KKP-E) with a ceiling Rp8, 14 trillion. Eighth KPEN RP Rp37 trillion with credit approval contract reached Rp5 trillion. Ninth, Credit for Community business (KUR) for the agricultural sector has reached a cumulative distribution Rp4, 4 trillion. Lastly, is the investment of the private and the public.

Ten issues facing the agricultural sector, namely the increasing environmental degradation and global climate change, the availability of infrastructure, facilities and infrastructure, land, and water. Then, the status and small size of ownership of land (9.55 million households with <0.5 ha), so make the weak the seed systems and national seed breeding. More further are, farmers' limited access to capital, high interest rates for farming activities, and weak institutional capacity of farmers and extension workers, food security is still vulnerable and still far reaching energy security, diversification of food has not been running well, the low term of trade of farmers (NTP), and less optimal performance and service of agricultural bureaucracy, and integration of inter-sectorals/institutions.

Fundamental problems face in agriculture development are fertility decline in physical, chemical and biological agricultural land so disturbed plant growth, and fertilizer efficiency is low, and should restore the fertility and quality of “sawah” (rice fields).

Revising APBN 2010, arguably; background
The legal basis argued by the government when proposing APBN-P 2010 revision of version of APBN 2010, however, arguably. According to the Parliament the legal basis used by the government in submitting a draft revision the state budget 2010 not correct. On contrary, Finance Minister Sri Mulyani Indrawati (at that time) said the legal basis used by the government was appropriate. During deliberation sessions in the House of Representatives Commission XI, Tuesday (13 / 4) walked a lot. This is related to basic law of a draft revision version of the 2010 state budget proposed by the government by using Article 27 of Law Number 47 Year 2009 regarding the state budget in 2010, Article 27 of Law Number 17 Year 2003, and Article 156 of Act No. 27 of 2009 on the MPR, DPR, DPD, and Parliament. Parliament, however, considered the use of a third legal basis was not appropriate. Member of Commission XI Nusron Wahid said the government could not submitted a draft of revision to the 2010 state budget by using Article 27 of Law Number 47 Year 2009 regarding the state budget in 2010. Because there is no report that mentions the existence of the first semester of macro changes in assumptions. Whereas Article 27 of Law Number 47 Year 2009 stated, the government can ask approval revision to the State Budget if any changes to the macro assumptions, changes in some budgets, and if any semiannual reports. "This is just one quarter, of which how can the government are able to consolidate a report for semester so fast?" asked Nusron.

Budimanta Arif, a member of Commission XI of the other added, no diction or choice of words in Article 27 of Law Number 47 Year 2009, which called the government may propose RAPBN-P for priority programs. "What is proposed is a priority program. When the government filed this priority program with Article 27 of Law on State Budget 2010, the government and we are discussing this, everything has been violating the law," said PDIP these politicians.

Riza V. Tjahjadi
email: biotani@rad.net.id, biotani@gmail.com, biotani2004a@yahoo.com

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