Robert Go, Jakarta – The Indonesian government will dig out 900 billion rupiah from its cash-strapped coffers to counter El Nino-induced droughts that could devastate this year's harvests and spark haze-forming fires.

Resettlement and Regional Infrastructure Minister Soenarno said after this week's Cabinet meeting: "Money will be distributed to 13 provinces to provide water for their irrigation systems and clean water for day-to-day use."

President Megawati Sukarnoputri has also given Research and Technology Minister Hatta Rajasa a 10-billion-rupiah budget to launch cloud seeding and other rain-inducing activities in several areas of the country. Officials said the money would come from funds already budgeted for dealing with natural disasters and other unexpected events.

The government will also tap the same budget source to fund a 1.2-trillion-rupiah effort to fix canals and irrigation channels that were destroyed by heavy rains which caused flooding in several areas, including Jakarta, earlier this year.

But for millions of farmers across the archipelago, some of whom are already fighting each other for access to water, the government's actions may come too late.

A harsh dry season has left more than 50,000 hectares of rice-growing fields dry and farmers and their families hungry. Drought-hit regions include rice-bowl areas in Java, Sumatra and Sulawesi as well as normally dry areas such as West Nusa Tenggara province.

The Agriculture Ministry says drought damage has remained under control so far and the size of affected growing areas is still a small percentage of Indonesia's 11.5 million hectares of rice fields.

But meteorology and geophysics agency BMG has issued warnings that because of El Nino and other natural factors, the dry season this year may continue into December – two months longer than usual – and drought could spread into other areas of the country.

Associations for producers of several agricultural commodities have predicted lower harvests this year because of drought. Harvests that may be affected include palm oil (expected to drop about 10 per cent), cocoa (20 per cent) and rubber (5 per cent).

A prolonged dry season would also reduce hydro power and deepen Indonesia's economic trouble by robbing millions of homes and businesses of electricity.

Haze-sparking fires are yet another environmental – and potentially diplomatic – concern that Indonesia will have to deal with as a result of the dry conditions.

Analysts say the government should be better prepared to deal with such emergencies and should devote more money to helping farmers, who make up about half of the population.

Mr Didik Rachbini, of the Institute for Development of Economics and Finance, said: "The drought happens each year, affecting the lives of millions of poor farmers. But government expenditure for agriculture remains very small."