Fertilizer subsidies likely to be reduced despite drought
Fertilizer subsidies likely to be reduced despite drought
JAKARTA (JP): The government will likely continue its policy
of gradually reducing fertilizer subsidies despite the protracted
drought, Minister of Agriculture Syarifuddin Baharsyah says.
"Although the final decision will come out after a limited
cabinet meeting in October, I can say that most likely we will
continue on the track of subsidy reduction," Syarifuddin told
reporters during a break in a hearing with Commission IV of the
House of Representatives (DPR) yesterday.
Fertilizer subsidies, formerly the largest agricultural
subsidies due to its vital role in rice production, have been
gradually phased out since 1989 as part of the government's
effort to make the economy more efficient.
Rice is the main staple of more than 90 percent of Indonesia's
population of 189 billion.
Syarifuddin also told the commission, which deals with
agriculture and forestry affairs, that the government will focus
on expanding rice fields to secure adequate supplies of the
staple.
"In South Sulawesi, there are now an additional 40,000
hectares of rice fields," he said, citing an example.
The minister also stated that the government has appealed to
farmers to use water from the existing irrigation schemes more
efficiently, reminding that in Indonesia, the efficiency rate of
irrigation use is only about 50 percent.
Damaged
According to the Ministry of Agriculture, the current drought
has affected about 843,000 hectares of rice fields, of which
150,000 hectares have been completely damaged.
This indicates that the damaged areas have increased by 39,000
hectares since Director General of Food Crops and Horticulture
Amrin Kahar said last month that the drought had damaged 111,000
hectares of rice fields.
Kahar also said that the drought might slash four percent off
last year's production level of 48.1 million tons.
The official weather agency said on Monday that the rainy
season is coming late this year for many parts of Indonesia,
including West and East Java, which are regarded as Indonesia's
"rice bowl" areas.
The dry season usually lasts from April through September.
Vietnam
Food Minister Ibrahim Hasan, who also chairs the State
Logistics Board (Bulog), announced recently that the government's
rice stocks of 1.1 million tons are "sufficient to feed the
nation for seven months."
He also said that Bulog will receive shipments of some 100,000
tons of rice from Vietnam and Thailand as "repayments of
Indonesia's rice loans."
However, a news report from Vietnam last week stated that
Hanoi was selling 265,000 tons of rice in the next two months to
Jakarta at about US$200 to $220 per ton.
Last week, two shipments totaling 15,200 tons of rice arrived
in Jakarta from Vietnam and Thailand.
It is still not clear whether these rice were "loan payments"
or imports.(hdj)