Indonesia: Strategic Vision for Agriculture and Rural Development

Abstract

Most of Indonesia’s poor live in rural areas and depend on the agriculture sector for their livelihood. Thus, only through accelerated rural development can Indonesia achieve its goal of halving poverty by 2015. The Asian Development Bank (ADB) is privileged to work as one of Indonesia’s partners to assist the Government in this vital undertaking. ADB began operations in the agriculture sector in Indonesia in 1968 with two technical assistance (TA) activities – a rural credit survey and provision of advisers to the Ministry of Agriculture. By 2006, in the agricultural and rural development (ARD) sector alone we had provided $4.2 billion in project financing and $69.4 million in TA. These activities were concentrated in agricultural support services, crop production, fisheries and marine resources, livestock, tree crops and agro-industries, irrigation and rural development, and forestry and environmental management. In 2001, the Government of Indonesia requested TA to provide inputs into its 2004-2008 Medium-term Development Plan (MTDP). ADB responded rapidly, bringing in a high-quality team of experts from the Southeast Asia Regional Center for Graduate Study and Research in Agriculture (SEARCA), International Food Policy Research Institute (IFPRI), and Center for Regional Resources Development and Community Empowerment to work with the Government to formulate realistic, effective strategies to advance agricultural and rural development. The team found that, through a strategic focus on development of human resources, institutions, knowledge, and infrastructure, and by providing an enabling environment, the ARD sector can fulfill its potential to contribute significantly to sustainable, pro-poor development of the country. This publication summarizes the study’s findings and recommendations to facilitate their dissemination to broader audiences both within and outside Indonesia. The original TA report was undertaken by a team of experts led by Mark Rosegrant and Ashok Gulati of IFPRI under the guidance of Arsenio M. Balisacan of SEARCA. Muhammad Ehsan Khan led the work on this publication with support from Bobur Alimov under the guidance of M. Jamilur Rahman. The original TA report was abridged by Mary Ann Asico and Claudia Ringler and edited by Stephen Banta with the help of Jo Narciso. Urooj S. Malik, Director, Agriculture, Environment and Natural Resources Division, Southeast Asia Department, provided oversight and direction in preparing the publication.