BKPM wants monopoly in plantation permits
JAKARTA (JP): The Investment Coordinating Board (BKPM) is seeking the President's approval to become the sole agency responsible for issuing business permits in the plantation industry, a board executive said here on Tuesday.
The vice chairman of BKPM, Andung A. Nitimihardja, said pooling the licensing process under BKPM would cut the complicated bureaucratic procedures faced by potential investors when applying for business permits.
Andung said potential investors were currently required to obtain licenses from at least four government offices before they could develop a plantation.
Investors must obtain a forest relinquishment permit from the Ministry of Forestry and Plantations, the right-to-use-land title from the National Land Agency (BPN), a location permit from the local administration and investment approval from BKPM.
Andung said such complicated licensing procedures often discouraged potential investors.
"We have received several complaints from investors about the complicated procedures. The state minister of investment/BKPM chairman has met with the minister of forestry and plantations and the chairman of BPN to discus the possibility of pooling the licensing procedure under one government office," he said.
Andung said a number of potential oil palm investors were unable to realize their plans to open oil palm plantations because of the complex licensing procedure.
He said many of the investors who wanted to develop plantations had received investment approval from BKPM and location permits from the provincial administration, but were not able to develop plantations because they could not obtain forest relinquishment permits from the Ministry of Forestry and Plantations.
It currently takes two days for investors to get investment approval from BKPM and one year for investors to get a location permit from the provincial administration. However, they must wait at least two years to get the forest relinquishment permits, Andung said.
Andung said the government needed to revoke the ruling which obliged potential plantation investors to obtain forest relinquishment permits.
He said the Cabinet meeting on investment scheduled for July would decide whether BKPM would become the sole agency in charge of issuing business permits in the plantation industry.
"If the government decides not to give its approval to BKPM, investors should be allowed to work on their projects on the basis of location permits issued by the provincial administration. Or, at the least, the forest relinquishment permits could be issued by the ministry's provincial offices," he said.
Sources said the proposal for one-stop service in issuing business permits in the plantation industry had received opposition from other related government offices, which often abuse the licensing process to charge investors illegal fees.
Investors who want to develop plantations often have to bribe officials to ensure they obtain their licenses in a timely matter, the sources said.
Aside from difficult licensing procedures, rampant looting and theft at plantations also discouraged investors from investing in the country's plantation industry, Andung said.
"It's a pity because Indonesia is the best place to develop oil palm plantations since the Malaysian oil palm sector is already crowded," he said, adding that the government should take strict action to deter looters.
Director General of Plantations Agus Pakpahan said earlier this month that rampant looting of plantations in 1998 caused an estimated loss of Rp 2.6 trillion.(gis)