InfoSAWIT, JAKARTA – Indonesia’s palm oil fund management has come under scrutiny due to perceived imbalances in allocation between biodiesel incentives and support for smallholders.
Data shows that from 2015 to 2025, the BPDPKS disbursed Rp239 trillion for biodiesel programs, compared to only Rp12.01 trillion for the Smallholder Replanting Program (PSR).
The biodiesel program delivered significant macroeconomic benefits, including foreign exchange savings of Rp750.74 trillion and emission reductions of 222 million tons of CO₂.
However, critics argue that the relatively small allocation for PSR limits efforts to improve productivity among smallholders, who remain key players in Indonesia’s palm oil sector.
The SPKS has called for an increase in PSR funding from Rp60 million to Rp90 million per hectare.
Chairman Sabarudin stated that many farmers hesitate to join the program due to income uncertainty during the replanting period.
“Without adequate financial support, it is understandable that farmers are reluctant to participate,” he said.
The disparity—nearly 20 times more funding for biodiesel—raises broader questions about policy priorities and equitable benefit distribution within the palm oil industry.
Experts suggest that balancing upstream and downstream investments will be crucial to ensuring long-term sustainability and inclusivity in Indonesia’s palm oil sector. (T2)
