Indonesian Farmers and Agriculture after the Omnibus Law on Job Creation
The recently-adopted Omnibus Law on Job Creation provokes massive protests across archipelago mainly coming from workers and students among others. They demand justice since this law favor the investors, not to mention will worsen the labor systems and lives of workers. Not only workers who will be more miserable, local farmers too. This law is aimed to create plentiful jobs on all strategic sectors, including agriculture. But, is it really so?
When we carefully read the provisions regarding agriculture, it is clearly beneficial for business elites. One of them is the law would loosen food import regulations regardless of the domestic food availability. It abolishes the provisions on article 88 of Law 13/2010 on Horticulture and article 15 and 30 of Law 19/2013 on Protection and Empowerment of Farmers which stated that food import is prohibited when domestic production and National Food Reserves are adequate or food import can only be done if needed while still prioritizing domestic production. Criminal sanction article for those who import when domestic needs are met is removed in the Job Creation law. The relaxation on import regulations also apply for seed import. This will affect the domestic seed industry, inhibit innovation and threaten local seed genetic diversity.
Locally produced food will lose out to much cheaper imported food. This has already happened but the omnibus law has actually made Indonesia increasingly flooded with foreign commodities. It would make farmers discourage to plant thus the number of farmers will decrease due to they cannot compete with efficiently produced imported food and since it is unpromising, the younger generation also are potentially getting more away from agriculture. Statistics showed that the number of people working in the agriculture, forestry and fisheries sectors continues to decline from 33.88% in 2015 to 27.33% in 2019 (Statistics Indonesia). The decline in numbers also occurred for young farmers (19–39 years) around 415,000 young farmers in a year only (2017–2018) (Statistics Indonesia).
In addition, the government seems to have failed to see the problem and the context. For decades, farmers have always called for imports to be stopped. The government argues that import is essential to stabilize prices and ensure the food availability. However, that is only temporary, especially if it is often miscalculated and political, not a long-term solution. Besides, agricultural imports were played by the cartels, but the changes offered by the law did not solve them. With this law, the government will facilitate the flow of imports instead of fixing the root problems experienced by local farmers such as access to resources (land, water, and energy), commodity prices fluctuation, fair market, dependence on inputs, etc. This proves the statements of experts that this law is procedurally flawed because it did not carry out proper public consultations involving all elements of society, especially those closely related to matters amended in this law.
Take land possession as an example, AKATIGA (Centre of Social Analysis) study shows that there are people and young generation who are interested in farming but are hampered by difficulties in accessing land to grow crops. This Job Creation Law exacerbates the problem of small land possession of farmers where agricultural land can be converted for National Strategic Projects. The rate of change in agricultural land use has increased or in other words, there has been a decrease in the area of agricultural land about 650,000 hectares in five years (2013–2018). If it is assumed that the national rice productivity is 4 tons per hectare, then Indonesia has lost at least 2.6 million tons of unhulled rice per planting season due to the conversion of paddy fields. Omnibus law will make the decline even sharper and farmers’ land possession will be narrower. Therefore, the ultimate aim of this law to create jobs should be reviewed because in fact, it will reduce farmer to being a profession because agriculture is providing an alternative employment for rural communities and young people.
Regarding land, the law mentions several new provisions concerning Land Bank which as an institution in managing country’s land. Land bank are given the authority to prepare a master plan of land, help facilitate business licensing/approval, carry out land acquisition, and determine service rates. If there is no such thing as clear rule and transparency, it will become a source of new corruption and has the potential to become an institution that only serves investors. Marginalized communities (including young people) tend to have their access to land closed, while they must be able to get access to land as one of resources to farm.
Not only the ease of importing food and controversy of land banks, this law also makes it easier for investors to open agribusiness here, anywhere in Indonesia, without the hassle of conducting environmental impact analysis and risk management. Law 39/2014 on Plantation states that environmental impact analysis is one of the requirements that must be met if one wanted to build agribusiness/ cultivation business. However, in the new law, articles on environmental impact analysis are removed, such as articles 45 and 68. Moreover, sanctions for perpetrators of violations were also removed, such as articles 105 and 109. Given that, all the provisions regarding environmental sustainability seem impractical. Big agribusiness investment will generate environmental trade-offs and Indonesia is not even trying to mitigate it but is putting it aside. The environment has its own carrying capacity, if the business exceeds this limit it will affect the production of agricultural commodities eventually. And if the environment is damaged, we will no longer be able to grow quality crops, let alone the issue of climate change. With a damaged environmental condition, production will be predicted to decline over time and this is will then become a justification for the government to take a shortcut; food import. In addition, the provision on amount of foreign investment is limited to a maximum of 30% as stated in Law 13/2010 on Horticulture also disappeared in the new law. This will allow foreign countries to control our country through their investment.
All of adverse emerge from this Omnibus Law on Job Creation boils down to agriculture is no longer an identity, nor a “culture” in Indonesia. This law arises awful threat to the sustainability of smallholder farmers in which they are supposed to be protected by the state, to the diversity of national food, to the quality environment. Indonesia is known to the world for its quality agriculture production and rich natural resources. People do not realize that agriculture is a sector that can withstand times of crisis, both economic and health crises as we are currently experiencing. It is due to the hard work of smallholder farmers in villages throughout Indonesia who keep farming despite many obstacles they undergone.
The proponents of the law will use pretexts of facilitating the investment to meet the food needs of Indonesians, but is not there a more sustainable way socially and environmentally? The law could make Indonesia more dependent on food imports, foreign investment and also narrowing down job opportunities as farmers. The spirit of food sovereignty would be more difficult to achieve. Therefore, the only way is to oversee the derivative regulations of the Job Creation Law so that the law is more pro poor and are well enforced.
