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The Strategic Issues Of Agriculture Development In Indonesia

Sawah Istimewa

By Servas Pandur (Risk Consulting Group, Jakarta, 2017)  

In recent days, the world leaders and the most people of the Republic of Indonesia need look no further than the world's energy crisis, global warming and food security. The risk scenarios include the increasing of world population demands for higher standard of living, a need for less pollution and a low-carbon economy, a need to avert global warming, and a possible end to fossil fuels.

Around the world, the lives of some 850 million people are affected by some form of chronic hunger or malnutrition, according to UN estimates. In 2006, The World Food Program, working in partnership with private aid groups, provided $3 billion in food aid to nearly 90 million people. The lion's share went to emergency and relief operations, while 28 percent of the aid recipients were in development projects.

For poor people, the rising basic foods price and oils means the quality and quantity of nutrition are at risk. To response the crises, we should build the agriculture research stations to develop more varieties that could be used to produce the high quality of milk, crops, agricultural research, extension of agriculture, to provide semen for Indonesian farmers, and to adopt and develop Agro-ecosystem Analysis and Farming System Research to gain a more holistic view of agriculture and to help scientists understand the problems faced by farmers and even give farmers a role in the development process in Negara Kesatuan Republik Indonesia (NKRI).

Why we shoud begin from the integrated-agriculture program? Because economically, the future currency is agriculture. Agriculture distinguishes clearly and fundamentally between living (nature, persons) and non-living (financial, social, instructional, infrastructural) roles in a productive process. The garderners, farmers, and peasant are the front fighters to protect environment, to save our planet, dan to conserve energy. For now, a social-economic transformation and development not of politicians and theorists, but of peasant, gardeners, fishermen, craftmen, farmers, shop-keepers, and purchasers. When gold is scarce and nature is plentiful, gold may be valued above nature. In the 21st century however, we are coming to realize that Nature's life-support systems can no longer be considered infinite. The basic of economy is commodities.
Ernst Friedrich "Fritz" Schumacher, who was a major pioneer of sustainable development and a value-based economics, is right for his critique of Western economies and his proposals for human-scale, decentralized and appropriate technologies. His book Small is Beautiful (1973) coincided with the growth of ecological concern and with the birth of environmentalism. Schumacher emphasized the value of a local point of view, like that of gardening,  that would require "use-value" or "service value" to be assessed in context of a living ecoregion or economic process, and would de-emphasize the value of resource, commodity or product measures. The life is not merely mechanistic: it has goals beyond mere pleasure and physical survival.

In 1377, Ibn Khaldun wrote in his book  Muqaddimah   on economic growth :  

"When civilization [population] increases, the available labor again increases. In turn, luxury again increases in correspondence with the increasing profit, and the customs and needs of luxury increase. Crafts are created to obtain luxury products. The value realized from them increases, and, as a result, profits are again multiplied in the town. Production there is thriving even more than before. And so it goes with the second and third increase. All the additional labor serves luxury and wealth, in contrast to the original labor that served the necessity of life."  

In the 21st century, we learn from the Nobel Peace Prize winners, Rajendra Kumar Pachauri (India), Wangari Maathai (Kenya), Albert Arnold (Al) Gore Jr.  (U.S.A) that sustainability of growth, human security, environmental security, peace, justice, order, and stability are interrelated process.   The assumptions of neoclassical economist, the main body of modern economics today, which categorized the environmental and social considerations as externalities in conventional economics, are not enough adequate for a long-term sustainable growth.

Our ecological understanding (in the sense of scientific knowledge and theory, as opposed to the holistic understanding of, say, an aboriginal hunter-gatherer) is a recently acquired cognitive construct. Our current economic behavior is motivated at a level of emotional and instinctual reward. In short, mainstream ("grey") economics is emotionally motivated, and green economics is rationally motivated. Green seeks the long term good; grey seeks immediate gratification. In neurological terms, green is coming from the frontal cortex; grey is stemming from the limbic lobe or the amygdale.

This clashes with the unfulfilled ambition of neoclassical economics to find scientific parity for its discipline with physics and chemistry. However, neoclassical and green economics may find points of overlap and come together in such doctrines as Natural Capitalism, which seems to reflect both green and neoclassical constraints. This common ground expands in environmental finance which seeks to justify biodiversity directly as a unit of stored value, e.g. a rainforest standard replace the gold standard. Some refer to this as a "biodiversity standard" or "bio-safety standard" of value, but these are not yet common usage - instead a broad strategy of using conventional financial instruments to save ecology deemed unique or irreplaceable has developed, without any agreement on any one standard of biodiversity's value.

For now, wee need to change our conventional approach to agriculture and economics in order to reduce poverty, to response food scarcity, to conserve energy, to protect environment, and to gain a sustainability of growth. It takes a grass-root democracy building and the widest possible view of stakeholders of a transaction to include impacts to nature, non-human-species, the planet, earth science and the biosphere. A holistic approach to the subject is typical. The economic ideas incorporate learning from other disclipines in a true transdisciplinary disclipine—ecology, law, energy, peace and international relations.

Since 1970, each 1 percent increase in the gross world product has yielded a 0.64 percent increase in energy consumption. Between 1950 and 1984, as the Green Revolution transformed agriculture around the globe, world grain production increased by 250%. That is a tremendous increase in the amount of food energy available for human consumption. 

The energy for the Green Revolution was provided by fossil fuels in the form of fertilizers (natural gas), pesticides (oil), and hydrocarbon fueled irrigation.   This additional energy did not come from an increase in incipient sunlight, nor did it result from introducing agriculture to new vistas of land. 

In the 1950s and 1960s, agriculture underwent a drastic transformation commonly referred to as the Green Revolution. The Green Revolution increased the energy flow to agriculture by an average of 50 times the energy input of traditional agriculture.  In the most extreme cases, energy consumption by agriculture has increased 100 fold or more.   The Green Revolution resulted in the industrialization of agriculture. Part of the advance resulted from new hybrid food plants, leading to more productive food crops.4
The dominant models of intensive agriculture and the global food trade depend on vast inputs of oil. In a post peak oil world, the combination of higher transport costs, climate change and increased conflict will necessitate us all relying far more on relocalised food supplies. Even though it requires far lower amounts of oil, organic farming is not exempt from the need to adapt.

The peaking of world hydrocarbon production (Peak Oil) may test Malthus critics. The United Nations projects that world population will stabilize in 2075 at nine billion due to the demographic transition. Birth rates are now falling in most developing nations and the population would decrease in several developed nations if there was no immigration.    The increasing of world population would increase demands on an additional energy supplies and services around the world.

I. Two Models of Development

Historically, the Green Revolution, first used in 1968 by former USAID director William Gaud,   refers to the transformation of agriculture that began in 1945 at the request of the Mexican government to establish an agricultural research station to develop more varieties of wheat that could be used to feed the rapidly growing population of the country. The agriculture transformation has continued as the result of programs of agricultural research, extension, and infrastructural development, instigated and largely funded by the Rockefeller Foundation, the Ford Foundation, other major agencies and many developing countries. Green Revolution was a movement to increase yields by using : (a) New crop cultivars, (b) irrigation, (c) Fertilizers, (d) Pesticides, and (e) Mechanization, and to eliminate hunger by improving crops performance.  

The White Revolution consisted of 19 program that were introduced by Shah Iran in Iran over a period of 15 years since 1963. The long-term aims of the White Revolution was to transform Iran’s social-economic toward an industrial country and global ecnomic power. The program reforms included numerous policies : (1) Land Reforms Program, (2) Nationalization of Forests and Pasturelands,  (3) Privatization of the Government Owned Enterprises, (4) Profit Sharing, (5) Extending the Right to Vote to Women, (6) Formation of the Literacy Corps, (7) Formation of the Health Corps, (8) Formation of the Reconstruction and Development Corps, (9) Formation of the Houses of Equity, (10) Nationalization of all Water Resources, (11) Urban and Rural Modernization and Reconstruction, (12) Didactic Reforms, (13) Workers' Right to Own Shares in the Industrial Complexes, (14) Price Stabilization and campaign against unreasonable profiteering, (15) Free and Compulsory Education, (16) Free Food for Needy Mothers and for all newborn babies up to the age of two, (17) Introduction of Social Security and National Insurance for all Iranians,  (18) Stable and Reasonable Cost of Renting or Buying of Residential Properties, and (19) Introduction of Measures to Fight against Corruption within the bureaucracy. 

For now, there are four main criticism of the two models for social-economic transformation. First, the Green Revolution was a product of globalization as evidenced in the creation of international agricultural research centers that shared information, and with transnational funding from groups like the Rockefeller Foundation, Ford Foundation, and USAID. Additionally, the inputs required in Green Revolution agriculture created new markets for seed and chemical corporations, many of which were based in the United States. For example, Standard Oil of New Jersey established hundreds of distributors in the Philippines to sell agricultural packages composed of HYV seed, fertilizer, and pesticides.  

Second, though the White Revolution contributed towards the economic and technological advancement of Iran, the failures of some of the land reform programs and the partial lack of democratic reforms, as well as severe antagonism towards the White Revolution from the clergy and landed elites, would ultimately contribute to the Shah's downfall during the Iranian Revolution in 1979.

Third, Miguel A. Altieri, one of the pioneers of agroecology and peasant-advocate, writes that the comparison between traditional systems of agriculture and Green Revolution agriculture has been unfair, because Green Revolution agriculture produces monocultures of cereal grains, while traditional agriculture usually incorporates polycultures.   This production of monoculture cereal crops is frequently used for export, feed for animals, or conversion into biofuel. Additionally, some claim traditional systems of agriculture that were displaced by the Green Revolution such as the chihampas in Mexico or raised-field rice farming in Asia can be highly-productive. 

Fourth, the Green Revolution has had major social and ecological impacts. Some criticisms and concerns generally revolve around the idea that the Green Revolution is unsustainable.    Paul R. Ehrlich, in his 1968 book The Population Bomb  said that India would never feed itself and claimed that "India couldn't possibly feed two hundred million more people by 1980" and "Hundreds of millions of people will starve to death in spite of any crash programs."  

Ehrlich's predictions failed to materialize when India became self sustaining in cereal production in 1974 as a result of the introduction of  Green Revolution program.   Famine in India, once accepted as inevitable, has not returned since the introduction of Green Revolution agriculture. Although the two models of social-economic transformation was criticized,  the consensus among some agronomists is that the Green Revolution and the White Revolutiuon has allowed food production to keep pace with worldwide population growth.

II. The Politics of Agriculture : Indonesian Experience

The people of Indonesia has a long history of the agriculture politics. The Dutch East India Company (VOC) had been set up in the early seventeenth century to maximize Dutch trade interests in the what was to become the boundaries of modern-day Indonesia. By 1700, a colonial pattern was well established; the VOC had grown to become a state-within-a-state and the dominant power in the archipelago. Its method of indirect rule was to survive it. After the bankrupt company was liquidated on 1 January 1800, its territorial possessions became the property of the Dutch government. During the nineteenth century, Dutch possessions in the Indonesian archipelago and its hegemony were expanded, reaching their greatest extent in the early twentieth century. 

Dutch economic strategy for the colony during the eighteenth and nineteenth centuries can be defined along three overlapping periods: the Cultivation System, the Liberal Period, and the Ethical Period. Throughout these periods, and until Indonesian independence, the exploitation of Indonesia's wealth contributed to the industrialization of the Netherlands. Large expanses of Java, for example, became plantations cultivated by Javanese peasants, collected by Chinese intermediaries, and sold on overseas markets by European merchants. Before World War II, most of the world's supply of quinine and pepper, over a third of its rubber, a quarter of its coconut products, and a fifth of is tea, sugar, coffee, and oil. Indonesia made the Dutch a most significant colonial power. 

Despite increasing returns from the Dutch system of land tax, Dutch finances had been severely affected by the cost of the Java and Padri Wars. An agricultural policy of government-controlled forced cultivation was introduced to Java. Known as the Cultivation System (Dutch: cultuurstelsel); much of Java became a Dutch plantation, making it a profitable, self-sufficient colony and saving the Netherlands from bankruptcy. The Cultivation System, however, brought much economic hardship to Javanese peasants, who suffered famine and epidemics in the 1840s. 

Critical public opinion in the Netherlands led to much of the Cultivation System's excesses being eliminated under the agrarian reforms of the "Liberal Period". From 1870, producers were no longer compelled to provide crops for exports. In Java, large plantations were open up to private enterprise. Sugar production, for example, doubled between 1870 and 1885; new crops such as tea and cinchona flourished, and rubber was introduced, leading to dramatic increases in Dutch profits.
In 1898, the population of Java numbered twenty-eight million with another seven million on Indonesia's outer islands.  The resulting scarcity of land for rice production, combined with dramatically increasing populations, especially in Java, led to further hardships. Changes were not limited to Java, or agriculture; oil from Sumatra and Kalimantan became a valuable resource for industrializing Europe. Dutch commercial interests expanded off Java to the outer islands with increasingly more territory coming under direct Dutch government control in the latter half of the nineteenth century.  

By 1901 the Dutch adopted what they called the Ethical Policy, under which the colonial government had a duty to further the welfare of the Indonesian people in health and education. Other new policies included irrigation programs, transmigration,  communications, flood mitigation, industrialization, and protection of native industry. Although far more progressive than previous policies, the humanitarian policies were ultimately inadequate. While a small elite of secondary and tertiary-educated Indonesians developed, the overwhelming majority of Indonesians remained illiterate. Primary schools were established and officially open to all, but by 1930, only 8% of school-aged children received an education. Industrialization did not significantly effect the majority of Indonesians, and Indonesia remained an agricultural colony; by 1930, there were 17 cities with populations over 50,000 with a combined population of 1.87 million.  

Imperial Japan occupied Indonesia during World War II from March 1942 until the end of War in 1945.  Less than three months, after the first attacks on Kalimantan the Japanese navy and army overran Dutch and allied forces, ending 300 years of Dutch colonial presence in Indonesia. the occupation turned out to be the most oppressive and ruinous colonial regime in Indonesian history. As a consequence, Indonesians were for the first time politicked down to the village level. But this political wakening was also partly due to Japanese design; particularly in Java and to a lesser extent Sumatra, the Japanese indoctrinated, trained and armed many young Indonesians and gave their nationalist leaders a political voice. Thus through both the destruction of the Dutch colonial regime and the facilitation of Indonesian nationalism, the Japanese occupation created the conditions for a claim of Indonesian independence. It would be Indonesians, however, who immediately following World War II would be the ones to fight a bitter five-year diplomatic, military and social struggle before securing that independence.

Following its military campaign in China Japan turned its attention to Southeast Asia advocating to other Asians a ‘Greater East Asian Co-Prosperity Sphere’, a type of trade zone under Japanese leadership and “Japan is our older brother”, “Japan is light of Asia”, and “banzai Dai Nippon”. The Japanese had gradually spread their influence through Asia in the first half of the twentieth century and during the 1920s and 1930s had established business links in the Indies. These ranged from small town barbers, photographic studios and salesmen, to large department stores and firms such as Suzuki and Mitsubishi becoming involved in the sugar trade. 

Experience of the Japanese occupation of Indonesia varied considerably, depending upon where one lived and one's social position. Many who lived in areas considered important to the war effort experienced torture, sex slavery, arbitrary arrest and execution, and other war crimes. Many thousands of people were taken away from Indonesia as unfree labour (romusha) for Japanese military projects, including the Burma-Siam Railway, and suffered or died as a result of ill-treatment and starvation. People of Dutch and mixed Dutch-Indonesian descent were particular targets of the Japanese occupation.

During the World War II occupation, tens of thousands of Indonesians were to starve, work as slave laborers, or be forced from their homes. In the National Revolution that followed, tens, even hundreds, of thousands (including civilians), would die in fighting against the Japanese, Allied forces, and other Indonesians, before Independence was achieved.  A later United Nations report stated that four million people died in Indonesia as a result of famine and forced labor during the Japanese occupation, including 30,000 European civilian internee deaths. 

Materially, whole railway lines, railway rolling stock, and industrial plants in Java were appropriated and shipped back to Japan and Manchuria. British intelligence reports during the occupation noted significant removals of any materials that could be used in the war effort. During the Japan occupation in Indonesia, Japanesse rulers and the Indonesian nationalist leaders introduced ‘Pusat Tenaga Rakyat’ movement to build a new society in Java. The aims of this program was to support the Japanesse colonialism system, especially to support the Imperial rulers win the World War II in Asia and to build a new ‘Greater East Asian Co-Prosperity Sphere’. The program, concentrated in Java island, included : (1) trainning program in areas such as agriculture, fishery, animal husbandary, trading, industry, cooperatives, skilled-labor, savings, enterpreneurship, credits; (2) literacy program; (3) cultural program since March 1943. 

The Japanese regime perceived Java as the most politically sophisticated but economically the least important area; its people were Japan’s main resource. As such—and in contrast to Dutch suppression—the Japanese encouraged Indonesian nationalism in Java and thus increased its political sophistication (similar encouragement of nationalism in strategic resource-rich Sumatra came later, but only after it was clear the Japanese would lose the war). The outer islands under naval control, however, were regarded as politically backward but economically vital for the Japanese war effort, and these regions were governed the most oppressively of all. These experiences and subsequent differences in nationalistic politics would have profound impacts on the course of the Indonesian Revolution in the years immediately following independence (1945 – 1950). In addition to new-found Indonesian nationalism, equally important for the coming independence struggle and internal revolution was the Japanese orchestrated economic, political and social dismantling and destruction of the Dutch colonial state. 

After World War II, the ‘Pusat Tenaga Rakyat’ movement had positive impacts in food production. In 1946 year, the Indonesian government and the people of the Rpublic of Indonesia delivered more than 250.000 tons rice to help famine in India.   Food production increased dramatically for the benefit of the famers and generally the people of Indonesia. The Jawaharlal Nehru Government of India delivered 200 contaniers of clothes in Indian shipping to the Republic of Indonesia. Economically, the exchange of rice form Indonesia and goods, clothes, and agriculture equipments from India based on barter system. Politically, all the colonialist Dutch efforts failed to block the Indonesian territory and to crush the Indonesian economy. So it should be noted that the founding fathers of the Republik of Indonesia was not only success in defending the independence of the new Republic, increasing food production, but also success in building an international order and peace through the politics of agriculture.
During the periode of 1945 – 1965, the key goals of the politics of agriculture was to increase the food production, a balance of food distribution, prices control, and people’s prosperity. The Government paid much attention on the agriculture sector, such as  intensification of the agriculture sector in Java island and expansion of planting area at 750.000 ha of forest-land, farming area, and the former erfpacht klein landbouw area,  rice-field at 138.000 ha and 566.000 ha plantation area for high-quality rice-field. A Prosperity Minister  (Kementerian Kemakmuran) was responsible for this program.   
Labor was paramount as the article 27 (2) of the UUD 1945 Constitution  stated firmly: “Each citizen shall be entitled to an occupation and an existence proper for a human being.”  Land was paramount as a factor of production. The Government proposed that peasants should have enough land for farming and to meet their standard of living. A plantation-land was distributed to each poor-peasants through transmigration program. The Government also planned a land tax, literacy program dan cooperatives-building in villages level. A conversion of land-owning was proposed to increase the production of sugar-cane in Java. The abandoned land and unproductive-land should be controlled by the state for the prosperity of the people. A removal of land-owning should be done with the village’s chief permission.
The land as a factor of production was rarely discussed during the Sjahrir and Amir Sjarifuddin government in 1945-1948. In the end of May 1948, the Government formed an agriculture committee (Panitia Agraria). This committee had to propose any consideration on agriculture development, especially (a) a maximum land-owning, (b) agrarian law, (c) basic law for the politics of agriculture (agrarische wetgeving) in the Republic of Indonesia, (d) change of rules, (e) land for use of village employees and village chief’s (tanah bengkok), (f) land-research, (g) land-distribution for poor-peasants, (i) the role of foreign and private companies.   The Government also formed a People’s Food Preparation Ministry (Kementerian Persediaan Makanan Rakyat).
Before 1948, 75% of the Indonesian total population was farmers, 25% of the total population was non-farmers. Almost 25% - 30% of the farmer’s production was sold to the 25% non-farmers population, to meet their basic needs dan to fulfill teird duties such as tax payment, salt, petroleum, clothes, and others.    During 1945-1949, the 1945 constitution states that "Branches of production which affect the life of most people shall be controlled by the State." Lingering disruptions abroad from World War II and at home from the fight for independence hurt production of the exports the islands' economy depend on. The Dutch carry out several "police actions" against independence forces in an effort to retake key plantation areas.
In the 1957, regionals representatives and functional groups made a Development National Conference (Musyawarah Nasional Pembangunan) in Jakarta. That was the first time, the Indonesian government and people’s representatives arranged a five year development plan 1956-1960 such as Five Year Plan of India and RRC in 1950-an. In the year of 1957, total population of Indonesia was 85 millions. At the year, total rice production was 7.5 million tons. The government planned a food-diversification.  
During 1950-1956, Indonesia inherits an agricultural export economy based on Dutch investment. Linking capitalism with colonialism, nominally socialist parties move to dismantle the colonial economy slowly. With little private capital, state capitalism drives efforts to reduce foreign control. The state controls some banking, utilities, industry, and trading firms, but with the goal of boosting a private sector. During 1957-1965, state accelerates as state-owned firms take over foreign plantations and private companies. By 1960 a Guided Economy seeks to industrialize through centralized planning and control, which Sukarno calls "socialism a la Indonesia." Failed policies and mismanagement causes inflation, a fall in per capita GDP, and an inability to import goods or service debts.
The Suharto Administration initiated the First Five-Year National Development (Repelita) Plan, a comprehensive plan for economic development, in 1969 and continued to renew it every five years since that time, up to the Sixth Plan. Under the Repelita, economic growth rates targets and sector targets were established, and the central government distributed the budget for development by region based on those targets.  
Since 1969, the Suharto administration paid much priority on agriculture development. For examples, the main objectives of First Five Year Plan (April 1969 - March 1974) was to increase agricultural production, develop industry that supports agriculture, restore infrastructure, increase clothing production, implement positive fiscal and financial policies through foreign aid, and revitalize investment activity through preferential treatment measures for private investment; (2) Second Plan (1974 - 1979) : Increase agricultural and clothing production, increase employment opportunities, and increase housing; (3) Third Plan (1979 - 1984) : Achieve food self-sufficiency, promote labor-intensive industries and finished product processing industries  (4) Fourth Plan (1984-1989) : Reduce dependence on oil, increase employment opportunities, promote capital goods processing industries and intermediate input goods processing industry;  (5) Fifth Plan (1989-2004): Increase employment opportunities, equalize income distribution, develop balance between agriculture and industry; (6) Sixth Plan (1994-1999) : Simultaneously achieve growth, equity, and stability.
Green Revolution technological advances and increased use of fertilizers, pesticides, and irrigation improved rice production in the 1970s and 1980s. Cash crops include cocoa, coffee, copra, palm oil, peanuts, rubber, soybeans, sugar, tea, and tobacco. Animal husbandry (dairy and beef cattle, poultry and eggs, and pigs) and fishing are small but valuable parts of the agricultural sector.  
Attempts to ameliorate rural poverty by means of a transmigration program moving families from crowded agricultural regions such as Central Java to less crowded areas in, for example, Sumatra and Kalimantan, have failed. Greatly expanding a program begun by the Dutch early in the twentieth century, at the program’s height in the 1979–84 period the Suharto government moved 500,000 people. Poor funding and preparation, local hostility, suspicions about ulterior motives, and (somewhat ironically) economic growth on Java, brought about a precipitous decline; in 2000 the transmigration program was ended.   
The Suharto’s politics of agriculture was awarded by international communities. For example, Soeharto was awarded the United Nations Population Award (UN); From Rice Importer to Self Sufficiency Medal (FAO); Health for all Gold Medal (WHO), Golden Order of Merit (IAAF), Avicenna Gold Medal (UNESCO), The “Spirit of Helen Keller” Award (Helen Keller Int.), Award Certificate for Poverty Eradication (UNDP).
The New Order period saw the rapid growth of an industrial work force and increasing labor unrest. There were about 350 strikes in 1996, nearly twenty times the number only seven years earlier. Government policy attempted to repress labor activism, but at the same time adopted a policy of raising the minimum wage annually; by 1997 it was three times what it had been six years earlier.
The fall of Suharto lifted many pressures on unions and raised minimum wages even more quickly, Jakarta’s rising nearly 40 percent in 2001 alone and steadily after that, to about US$80 a month in 2004. In 2002 Indonesia’s the labor force numbered 100.5 million, of which an estimated 10.5 million were unemployed. Another 32 million individuals fell into the category of “disguised unemployment.”   
In November 2000 under President Wahid, a new national development program (Propenas) was presented, replacing the Five Year Plan (Repelita). In the Propenas, major issues such as democratization, judicial reform, building of infrastructure for sustainable economic growth and poverty alleviation were raised. Although economic target values by sector have not been stipulated, as was the case with the Repelita, it is thought to be consistent with a policy that promotes autonomous development of regions from their own perspective within a decentralized framework. The Propenas also differs from the Repelita in that it was enacted after deliberations in the parliament.
The major policy objectives of the Propenas (2000-2004) are as follows: (1) Sustain high-level economic growth and restrict population growth;  (2) Promote balanced regional development and eliminate gaps between regions, social strata, fields, and metropolitan and rural areas, and eradicate of poverty; (3) Increase employment opportunities, improve productivity, and reduce unemployed through balancing disproportionate population distribution; (4) Develop human resources; (5) Develop science and technology to support Indonesia’s development and independence;  (6)  Maintain a balance between high-level economic growth and conservation of natural resources; (7) Establish an adequate legal system and strengthen social groups to minimize the undesirable effects of economic growth on social values and culture.  

III.  The Agriculture Crisis Audit  

For months, the soaring price of food – especially rice – has been on everyone's lips after international prices nearly tripled between January and April 2008. In theory, higher global prices should mean more income for rice farmers here on Java island, the breadbasket of the Indonesian archipelago of 234 millions who together eat around 32 million tons a year. Some of the benefits are not trickling down to farmers. Poorer farmers who till small plots – Indonesia's average is 0.3 hectares – tend to hold onto their own crop, then buy rice when their stocks run out; because of a dark future for rice in the Republic of Indonesia.
For now, the national logistics agency, which buys and sells rice to stabilize prices, plans to stockpile up to 3.8 million tons this year from a harvest estimated to reach 34 million tons. Last year, Indonesia imported 1.3 million tons, putting it among the world's top rice buyers.
Indonesia is located in Southeast Asia and is the world's largest archipelago composed of more than 17,000 islands bordering Papua New Guinea, East Timor, and Malaysia. The national population from the 2000 national census is 206 million,  and the Indonesian Central Statistics Bureau and Statistics Indonesia estimate a population of 222 million for 2006. 130 million people live on the island of Java, the world's most populous island. Despite a fairly effective family planning program that has been in place since the 1960s, the population is expected to grow to around 315 million by 2035, based on the current estimated annual growth rate of 1.25%    
In 2004, agriculture represented a declining share (17.5 percent or lower; down from 20.6 percent in 1993) of gross domestic product (GDP) but employed a majority of workers (an estimated 45 percent of the total labor force). Only about 11.3 percent of the total land is arable. Farming is controlled by smallholders and on large private and government-owned commercial plantations. Rice dominates food production, but cassava, corn, fruits, sweet potatoes, and vegetables also are important subsistence crops.   Manufacturing surpassed agriculture in terms of contribution to gross domestic product (GDP) in the early 1990s and has continued to be the largest single component of the country’s economy. A significant portion of the national budget has continued to be allocated to agriculture. Consequently, the country has remained self-sufficient in rice production since the mid-1980s.
According to 2001 estimates, 11.3 percent (206,753 square kilometers) of Indonesia’s total land area is arable, and land planted in permanent crops, including an irrigated area of 48,150 square kilometers, represents 7.2 percent of the total (132,051 square kilometers). There are 1,619,687 square kilometers of nonarable land and land not under permanent crops.   In 2002, about 8.5 million ha. of agricultural land were irrigated, most of which was used for rice production. This represented an increase of 57% over the irrigated area in 1980 (about 5.4 million). The intensity of irrigation, which is the proportion of irrigated land to total agricultural land, increased from 27.7% in 1980 to approximately 94% in 2002.
The agriculture census in 2003 showed that in Java 74.9 percent of peasant household were poor peasants household which only working on less than 0.4 hectare. It has increased since 69.8 percent in 1993. On the other islands, 33.9 percent (937.000) peasant families were poor peasant families. It has increased since 1993 that only 30.6 percent were poor peasant’s families. In 2005, more than 56.52% of the peasant’s household of entire country were poor.
In 2005, more than 56.3 million ha of forest concession was controlled by 470 companies. Almost 150 ha of mining concessions was controlled by 561 companies.  Around 1,932 companies controlled over 2.4 million ha of large-scale plantations. Other concessions such as building new cities, settlements, industrial estates, golf courses, will be given to many other companies. Almost 10 conglomerates controlled over 65,500 ha what are going to be an exclusive settlement. Land controlled by state corporations and private corporations increased. During 1971-2001, more than 1.753 cases of the removal land-ownership, with 10,892,203 hectares of dispute areas, and caused 1,189,482 peasants households.  
Globally, the Republic of Indonesia has played a modest role in the world economy since the mid-20th century, and its importance has been considerably less than its size, resources, and geographic position. The country perceived as an emerging market which has recovered from a number of past economic crisis in 1990s. The country is also a strong international exporter and maintains a positive agricultural trade surplus. Indonesia is one of the world’s main suppliers of rubber, coffee, cocoa, and palm oil; it also produces a wide range of other commodities, such as sugar, tea, tobacco, copra, and spices (e.g., cloves). Nearly all commodity production comes from large estates. Widespread exploration for deposits of oil and other minerals has resulted in a number of large-scale projects that have contributed substantially to general development funds.
A new draft bill before Indonesia's parliament would strengthen existing land-usage laws on 15 million hectares of agricultural land. The government is also opening up large tracts of land on Papua and other eastern islands for rice and other food crops, trying to offset the shrinkage on Java. The disadvantage is much lower crop yields on these islands compared with those on Java's fertile soil, typically 24 percent less for rice. The government is also subsidizing fertilizer and hybrid seeds, as well as repairing irrigation channels to ensure water supplies. Indonesia's drive for self-sufficiency in rice and other staples is a logical response to the global food crisis.

III. The Philosophy And Rules  

The founding fathers of the Republic of Indonesia and the framers of UUD 1945 Constitution postulated : (1) Whereas independence is a genuine right of all nations and any form of alien occupation should thus be erased from the earth as not in conformity with humanity and justice;    (2) Whereas the struggle of the Indonesian independence movement has reached the blissful point of leading the Indonesian people safely and well before the monumental gate of an independent Indonesian State which shall be free, united, sovereign, just and prosperous;  (3) By the grace of God Almighty and urged by the lofty aspiration to exist as a free nation, Now therefore, the people of Indonesia declare herewith their independence.
    Pursuant to which, in order to form a Government of the State of Indonesia that shall protect the whole people of Indonesia and the entire homeland of Indonesia, and in order to advance general prosperity, to develop the nation's intellectual life, and to contribute to the implementation of a world order based on freedom, lasting peace and social justice, Indonesia's National Independence shall be laid down in a Constitution of the State of Indonesia, which is to be established as the State of the Republic of Indonesia with sovereignty of the people and based : (1) on the belief in the One and Only God, (2) on just and civilized humanity, (3) on the unity of Indonesia, (4) and on democratic rule that is guided by the strength of wisdom resulting from deliberation / representation, (5) so as to realize social justice for all the people of Indonesia.  
    Articles of UUD 1945 (the Republic of Indonesia’s Constitution) state firmly constitutional rules on agriculture and its related issues.
Article 1 (3) of the Constitution  puts in order : “The State of Indonesia is a state based on the rule of law.”
Article 5 (2) of the Constitution puts in order : “The President shall issue government regulations to implement laws as needed.”
Article 18A (2) of the Constitution: “Relations as to finance, public services, the exploitation of natural and other resources between the central government and the regional administrations are to be regulated by law and implemented in a just and synchronized way.”
Article 18B (2) of the Constitution: “The State shall recognize and respect, to be regulated by law, the homogeneity of societies with customary law along with their traditional rights for as long as they remain in existence and in agreement with societal development and with the principle of the Unitary State of the Republic of Indonesia.”
Article 20 (1) of the Constitution : “The DPR has the power to enact laws.”
Article 23 (1) of the Constitution: “The state budget as the materialization of the state's financial management shall annually be determined in the form of a law and be implemented in an open and accountable way in order to achieve maximum prosperity for the people.”
Article 23A of the Constitution: “Taxes and other compulsory levies required for the needs of the state are to be regulated by law.”
Article 27 (1) of the Constitution: “All citizens shall have equal status before the law and the government and hold without exemption the law and the government in esteem.”
Article 27 (2) of the Constitution: “Each citizen shall be entitled to an occupation and an existence proper for a human being.”
Article 31 (1) of the Constitution : “Each citizen has the right to an education.”
Article 33 (1) of the Constitution: “The economy is to be structured as a common endeavor based on familial principles.”
Article 33 (2) of the Constitution: “Production sectors that are vital to the state and that affect the livelihood of a considerable part of the population are to be controlled by the state.”
Article 33 (3) of the Constitution: “The land and the waters as well as the natural riches therein are to be controlled by the state to be exploited to the greatest benefit of the people.”
Article 33 (4) of the Constitution: “The organization of the national economy shall be based on economic democracy that upholds the principles of solidarity, efficiency along with fairness, sustainability, keeping the environment in perspective, self-sufficiency, and that is concerned as well with balanced progress and with the unity of the national economy.”
Article 34 (1) of the Constitution: “Impoverished persons and abandoned children are to be taken care of by the state.”

IV. Policy Strategy Alternatives

In the globalization era, labor is paramount. In the agriculture sector, labor and land are paramount. Land is a factor of production. Population growth is a dinamic factor of any development strategy and poverty reduction program. The division of labor, pursuit of self interest, and trade can lead to economic well-being and prosperity or the wealth of the nations as Adam Smith, the ‘father of economics”, wrote in his book the Wealth of Nations (1776). The division of labor would effect a great increase in production and  an increase of wages, a view considered more accurate today.
In the globalization era, a country and nation-state like the Republic of Indonesia needs a new development strategy involving liberalization in some areas and limitation of foreign ownership in others to establish the Republic of Indonesia as a fully self-sufficient (swasembada) country in the 21st century. On the other side, the Republic of Indonesia needs a new agriculture development strategy to reduce poverty, to protect environment, to conserve energy, and to create prosperity, order, justice, and peace. The implementation of the Green Revolution and the White Revolution as a development strategy in Indonesia requisites the shift of paradigm toward a high quality of growth, rule of law and the use of an integrated-approach such as an energynomics approach   

A. An Integrated-Approach

The success of an agricultural development srtategy to reduce poverty, to protect environment, to conserve energy, and to establish a sustainable food system, depends upon a new integrated-approach agriculture development strategy. It involves a human economic history, literacy and education, legal aspects, energynomics, ecology, and proseprity approach. The integrated-approach is needed to solve the numerous environmental issues of Green Revolution such as  salinization by irrigation, aquifers drying up, top soil errosion, soil nutrient depletion, and pesticide-resistant species. The world community has clearly acknowledged the negative aspects of agricultural expansion as the 1992 Rio Treaty, signed by 189 nations, has generated numerous national Biodiversity Action Plans which assign significant biodiversity loss to agriculture's expansion into new domains.
Climate change and agriculture are interrelated processes, both of which take place on a global scale. Global warming is projected to have significant impacts on conditions affecting agriculture, including temperature, precipitation and glacial run-off. These conditions determine the carrying capacity of the biosphere to produce enough food for the human population and domesticated animals. Rising carbon dioxide levels would also have effects, both detrimental and beneficial, on crop yields. The overall effect of climate change on agriculture will depend on the balance of these effects. Assessment of the effects of global climate changes on agriculture might help to properly anticipate and adapt farming to maximize agricultural production.
A sustainable food system of a Green Revolution and White Revolution program is possible only if four conditions are met: (1)  Environmentally sound agricultural technologies must be implemented, (2) Renewable energy technologies must be put into place; (3) Major increases in energy efficiency must reduce energy consumption per capita; (4) Population size and consumption must be compatible with maintaining the stability of environmental processes.  
Without energy, the world's entire industrialized infrastructure would collapse; agriculture, transportation, waste collection, information technology, communications and much of the prerequisites that a nation takes for granted. A country and nation-state like the Republic of Indonesia needs to build a new development strategy  to provide the future energy needs that faces great challenges. These include an increasing world population, demands for higher standards of living, a need for less pollution, a need to avert global warming, and a possible end to fossil fuels. We hope that higher food prices, and the biofuel boom, might open the door to new opportunities for farmers in developing nations like the Republic of  Indonesia.

B. Rule of Law and High Quality of Growth

The implementation of the Green Revolution and the White Revolution models  of social-economic transformation in the Republic of Indonesia requires a shift of paradigm in the policy-strategy and an adjustment of institutional framework. A high quality of growth paradigm and rule of law should be used as guiding principles for implementing the Green Revolution and the White Revolution.  
The high quality of growth paradigm and rule of law should adopts and applies 10 main principles : (a) humanize concepts and policies on social, economics, politics, energy, and ecology ( for example, Articles 28A to 28J of UUD 1945 and Article 33 (4) of the Constitution); (b) respect for the local values and social goods (Article 18B (2) of the Constitution); (c) respect for the fundamental ethics, regulation and government, and equality before the law (for example, Article 27, 28A to 28J of the Constitution); (d) natural resources protection, energy conservation and environmental security (for example, Article 33 (3) of the Constitution); (e) adopt the market-efficiency (for example, Article 33 (4) of the Constitution); (f) control state budget, spending, and tax to prevent corruption (Articles 18A, 23, 23A, 23B, 23C of the Constitution); (g) improve human skills and knowledge, intellectual capital management (Articles 27 (2), 31, 28A to 28J of the Constitution), (h) poverty reduction, social security, and healthy services  (Article 34 of the Constitution), (j) law-abiding democracy (Article 1 (2) of the Constitution).

C. Platform of Policies

The  implementation of the two models for social-economic transformation will consists of 12 platform of policies in agricultural areas : (1) Labor Policy, (2) Land-plantation and land-ownership Policy, (3) Agricultural production and food security policy, (4) Infrastructure policy-basic infrastructures, technological infrastructures, and scientific infrastructures such as agricultural research station-building, adopt methods like Agro-ecosystem Analysis and Farming System Research to gain a more holistic view of agriculture;  (5) Trade policy and market regulations, (6) Public finance policy, (7) Fiscal Policy, (8) Investment Policy, (9) Monetary, Banking, Financial policy, (10) Education policy, (11) Health, Safety, and Environmental Policy;  (12) Agricultural industry policy to support other industries;   
There will be numerous challenges and obstacles in implementing the two models in the Republic of Indonesia : (1) risk of widespread corruption; (2) insecurity; (3) a lack of infrastructure; (4) a general lack of will on the part of the governments;  (5) environmental impacts; (6) social-political impacts;  (7) technologies; (8) globalization : tariff protection; (9) budgeting : it is expensive to plant rice and food production because of high production and labor costs, everyone wants to work in the factories; (10) Areas with good irrigation systems are the target of developers;  (11) low budget after decades of underinvestment in food crops areas;  (12) Poorer farmers who till small plots – Indonesia's average is 0.3 hectares – tend to hold onto their own crop, then buy rice when their stocks run out; because of a dark future for rice in the Republic of Indonesia. ***

Risk Consulting Group, Jakarta