Indonesia's agriculture industry has seen growing productivity over the past decade despite a decline in the number of workers, a national census shows, but the industry remains far behind neighboring countries in the Southeast Asian region, while major improvements are needed as prices continue to soar.
According to recently published data by the Central Statistics Agency (BPS), the number of workers in the farming sector who are over 15 years of age has declined from 40.61 million in 2003 to 38.86 million this year, but rice production in the same period has grown from 52.14 million metric tons to 69.27 million tons, indicating annual growth of 3.9 percent.
Corn production has also grown in the same period from 10.89 million tons in 2003 to 18.84 tons in 2013, representing growth of 7.16 percent annually. "This shows that productivity in the sector has been growing despite a decline in the number of workers," BPS chairman Suryamid affirmed.
The BPS collected the data in a census that is held every 10 years, which is aimed at getting a detailed and accurate picture of the country's farming industry.
Suryamin said the research this year had been conducted with a budget of Rp 1.6 trillion ($142 million), which had been allocated in the government's state budget.
Aside from workers aged 15 years or older, the number of farming households have declined by five million in the past decade to 26.13 million in 2013, the study revealed. In 2003, the island of Java was home to 17.91 million farming households, but only 13.42 million of them were recorded in the 2013 study.
Similarly, on the island of Sumatra, the number of households involved in the farming sector has decreased from 6.60 million to only 6.28 million, while Sulawesi island this year had 2.22 million households compared with the 2.41 million recorded in 2003.
Heavily dependent
Despite findings of growth in productivity, BPS officials emphasized that the country remains heavily dependent on its imported goods due to poor agricultural technology.
BPS analysis and development director Bambang Kristianto said it was very necessary for Indonesia to be able to come up with new technologies to help develop goods produced by farmers, adding that it is only then that Indonesia would be able to reduce its current dependency on imported goods.
"Indonesia is a country with the largest agricultural sector. But when we talk about technology, Indonesia is up to 10 years behind Malaysia, because Malaysia is much better in terms of their development of agricultural technologies," Bambang said.
He noted that the nation's agricultural sector contributed 15.04 percent to the GDP, even amid declining number of farmers over the past decade.
In the light of this, Bambang called on the government to focus on allocating more of its state budget for the agricultural sector as well as in improving the portion of agriculture in regional budgets across the archipelago.
He pointed out that many regions have focused greatly on their education and health sectors and undermined their agricultural potential.
"Many regions would use their annual budget for the education and health sector, while the agricultural sector would be their last priority. In the future, the budget for the sector should be increased to better our agriculture industry," Bambang said.
He added that by improving the regional government's budget for agriculture, it will subsequently be able to look into putting together a farmers bank, which he said could be key to attracting foreign investors in contributing to the development of Indonesia's agricultural technologies.
"The farmers' bank can be used as a source of finance in creating technologies for the agriculture industry," Bambang said.
Bogor Institute of Agriculture (IPB) rector Prof. Dr. Herry Suhardiyanto, during his speech at the institution's 50th anniversary, also underlined the need for the government to make improvement of its agricultural sector a focus.
"The IPB is aware that agricultural developments have yet to be optimally carried out, which is marked by the low farming production in comparison to national demand," he said, adding that the nation's dependence on imported goods and flawed agricultural management had strongly impacted soaring commodity prices.
Moreover, Herry noted that the nation was also faced with a string of other issues related to agriculture such as poor quality of health among the people and the poor welfare of farmers, fishermen and ranchers.
"These problems and challenges can be tackled if the government is serious about prioritizing the agricultural sector fully and consistently at every level," he said.
He added that it was also necessary for stakeholders to have the same vision and partnership between every sector related to the agriculture such as the industry, finance, human resources, technology and the political sector.
Lack of government support Firman Soebagyo, head of House Commission IV, which oversees agriculture, echoed a similar concern as he conceded that the government's lack of support to the agricultural industry has contributed to the decline in farming lands in recent years.
Approximately 100,000 hectares of land has been lost to factories and the property industry since 2010, causing more challenges in fulfilling local demand for strategic commodities.
"There is no support from the government. In every region there is quite a large amount of land that has been converted. Regional autonomy has led local governments to take shortcuts which has resulted in the conversion of farming lands," the Golkar Party lawmaker said during a discussion on Saturday.
He added that autonomy has pushed regional governments to increase their locally generated revenues (PAD) by surrendering their lands to investors to be turned into factories and properties.
Referring to that, Firman questioned President Susilo Bambang Yudhoyono's presidential speech in which he claimed the government would be setting aside an additional 45,000 hectares of land to support food security.
Firman said that it would take a lot for the government to create such land in light of recent conversion trends. "The government needs to see how land conversion is still happening," he said.
Firman also called on the Corruption Eradication Commission (KPK) to investigate possible suspect deals between the government and certain businesses in connection to the Trade Ministry's recent move to scrap the 10 percent import tariff on soybeans to tackle higher domestic prices.
"There are irregularities here, this is an economic crime, the KPK has to intervene," he said.
According to him, the House found that approximately Rp 400 billion of potential state losses last year from the government's move to lower soybean import tariffs and with the recent scrapping of tariffs, the number could further increase, although calculations have not been done yet.
"Surely the portions have been divided. This is what the KPK needs to investigate – the deals, the regulations which only enriches themselves [importers]," he said.
The Ministry of Agriculture has come under fire due to the recent beef import scandal in which it has allegedly increased the import quota for importer Indoguna Utama. "The government's regulation in handling imports should be balanced with efforts to improve domestic productivity," he added.
Firman said he was aware that the KPK had started assessing the agriculture industry such as seeds and fertilizers, which he acknowledged as a good move.
However, he pointed out that the KPK should investigate practices of soybean cartels as he suspected that there are six big companies who were allegedly involved in the practices.
An agricultural bill was passed in July aimed at empowering the country's largely impoverished agrarian class.