Loans made to protect river basin

JAKARTA (JP): The Ministry of Forestry will allow farmers to obtain loans derived from reforestation funds for the development of plantations aimed at conservation of river basin areas in Java and Madura.

Minister of Forestry Djamaloedin Soeryohadikoesoemo has even offered the use of the funds for "unlimited" purposes by farmers involved in the conservation of river basin areas, Director General for Reforestation Sumahadi said in Semarang, Central Java, on Wednesday.

He noted that in the current fiscal year, the ministry has allocated Rp 12 billion (US$5.5 million) for conservation programs in river basin areas on the two islands.

"Of the amount, Rp 10 billion is used as a credit facility for farmers involved in the conservation of a 5,000 hectare area of river basins," he said.

He added that the remaining Rp 2 billion is designated for the coordinating teams for financing their activities in guiding and training farmers in the project.

Sumahadi said that the ministry has set a ceiling for the credit at Rp 2 million for the development of one hectare of land. The credit, which has a maturity of five years, carries an interest rate of eight percent per year, he added. (fhp)