Foreign investors from China, Korea and Singapore have expressed their readiness to invest in the projects to cultivate including paddy to supply for domestic demand.
The government is aiming to attract less than Rp 100 trillion (US$10.6 billion) in investment through the development of three special economic zones (SEZs) producing agricultural products this year.
Indonesian Chamber of Commerce and Industry warns that the government’s plan to develop a major food estate in Merauke, Papua, may run into difficulties because confusing and overlapping land use regulations will deter investors.
Indonesian President Susilo Bambang Yudhoyono is scheduled to inaugurate the food estate on Feb. 12-13.
The Indonesian government is wise to learn from the South Korea Daewoo-Madagascar deal, which demonstrated the enormous economic, social and political risks associated with foreign ownership of land and water rights.
There are many controversies regarding the expected positive and negative impacts of President Susilo Bambang Yudhoyono's “food estate” program to be launched in Indonesia in February
As many as 32 investors plan to develop new sugar plantations and mills in several provinces, representing a total investment of Rp 24.3 trillion (US$2.6 billion), a minister has said.
Indonesia's Vice Agriculture Minister Bayu Krishnamurti said, “They are ready to invest, to build farms, factories and industries.”
Accaparement des terres - cas de l'Indonésie - par AGTER
Potentially, the government can set aside 12 million hectares for large-scale food cultivation.
The development, under which many residents will be forced to sell their land, has met opposition from locals and non-government organizations. The Indonesian Farmers Union (SPI) has said that it will lead to a “land grab” by big businesses at the expense of locals.
The firms plan to develop 187,000 hectares of sugar cane plantations and build several sugar factories which will have total capacity to process 76,000 tonnes of cane per day
