KDMP Catalyses Rural Community Welfare

The Village/Sub-district Red and White Cooperatives (KDMP) programme is being promoted as a new strategy for strengthening the village economy. Through Presidential Instruction Number 9 of 2025 and Presidential Instruction Number 17 of 2025, the government is positioning cooperatives as instruments to accelerate village-based economic sovereignty. The programme is further reinforced by financing support through Finance Minister Regulation Number 49 of 2025, Finance Minister Regulation Number 63 of 2025, and Finance Minister Regulation Number 81 of 2025. From a policy perspective, this move can be read as an effort to revitalise the mandate of Article 33 of the 1945 Constitution through a cooperative model that is more integrated with village development. Through Presidential Instruction Number 9 of 2025 on the Acceleration of the Establishment of Village/Sub-district Red and White Cooperatives (KDMP), President Prabowo’s administration is ensuring that the cooperative movement acts as a catalyst for public welfare, particularly in rural areas. KDMP as a roadmap to people’s prosperity, especially in villages, is a necessity. Cooperatives were born as a manifestation of Article 33 of the 1945 Constitution, embodying economic democracy based on the principle of kinship. Cooperatives serve multiple functions, including playing an active role in improving the quality of life of members and the community, strengthening the people’s economy as the foundation of national economic strength and resilience, and building and developing the economic potential and capabilities of members to improve their economic and social welfare. Therefore, the existence of KDMP plays an important role in improving public welfare, one of which is reducing the unemployment rate. Cooperatives encourage community economic independence. Through cooperatives, Indonesians can develop their businesses more easily. The concept of cooperatives in the country cannot be separated from the figure of Bung Hatta. Bung Hatta studied cooperatives in Scandinavia while pursuing his education at a business school in Rotterdam, the Netherlands. In 1925, one of the proclaimers of Indonesian independence visited Denmark and Sweden to learn about cooperatives. According to Bung Hatta, cooperatives are suitable for application in countries that are pioneering a people’s economy. The Scandinavian countries are classic examples of nations that adhere to the welfare state concept. This system emphasises the government’s proactive role in providing social protection and basic services for its citizens. By providing more equitable access to healthcare, education, housing, and social protection, the welfare state aims to improve well-being and reduce inequality in society. A welfare state is a social welfare system that gives a greater role to the state (government) to guarantee the fulfilment of its citizens’ basic needs. A welfare-based state is intended to provide social services for all citizens. The welfare state seeks to organise services that can maintain and improve the welfare of citizens in a fair and sustainable manner. A welfare state is one where the government is responsible for guaranteeing a minimum standard of living for its citizens, especially in rural areas. The welfare state is closely related to social policy, which in many countries includes government strategies and efforts to improve the welfare of its citizens, especially through social protection, including social security in the form of social assistance and social insurance.