US$17.39 loan set aside for people's forest projects
US$17.39 loan set aside for people's forest projects
JAKARTA (JP): The government has set aside Rp 40 billion
(US$17.39 million) this fiscal year to finance the development of
peoples' forests and Rp 15 billion to promote silk cultivation,
an official said yesterday.
The Director General of Reforestation and Land Rehabilitation,
Hendarsun S. Sanusiputra, said the funds would be given as soft
loans to farmers in 16 provinces.
The loans for developing peoples' forests would go to farmers
in 13 provinces. The provinces are Aceh, North Sumatra, Riau,
Jambi, Bengkulu, South Sumatra, West Java, Central Java, South
Kalimantan, East Kalimantan, Central Kalimantan, South Sulawesi
and Lampung.
The loans will support projects on 20,000 hectares.
The loans for silk cultivation will go to farmers in West
Java, West Sumatra and South Sulawesi, covering 3,390 hectares.
Hendarsun said the loans would be given to farmers through
nucleus estate and smallholder programs.
Under the programs, wood or silk-based industries act as
nucleus estates which provide farmers with a market and
collateral.
This way farmers and smallholders' access to loans is through
their nucleus estate partners.
"We have no target or priority as to who will get these loans.
Whoever is ready may submit an application to Bank Pembangunan
Daerah (Provincial Development Bank)," he said.
Hendarsun signed an administrative arrangement agreement with
Bank Pembangunan Daerah yesterday. The bank will distribute the
loans at the local level.
The loans for peoples' forest mature in 11 years, with an
eight-year grace period, while loans for silk cultivation mature
in five years with a one-year grace period. The loans have a 6-
percent interest rate.
Hendarsun said the loans, which are the first of their kind,
were expected to invigorate farmers' businesses.
The amount provided by the government could be added or
subtracted in the future depending on how farmers responded.
"If the farmers can only absorb Rp 20 billion of the Rp 40
billion provided for peoples' forests, then we might consider
giving them Rp 20 billion only in the future. But if they want to
borrow more than that this year, we may increase the amount next
year," Hendarsun said.
He said farmers would be given loans of Rp 2 million a
hectare. For provinces in Java, farmers eligible for the program
must have between 0.25 and 1.5 hectares, while those outside Java
must have between 0.5 and 3.4 hectares.
He said the government had chosen provinces that have a
tradition of making and using silk. (pwn)