Agricultural Infrastructure Investment Financing for Sustaining Renewable Energy in Indonesia

The energy crisis is a major issue that has not been solved by countries in the world.  The replacement of fuel oil (diesel, kerosene, etc) has been intensively conducted by several countries in the world. Nowadays, the most alternative energy to replace them which has been implemented around the world is bio-fuel. Jatropha (Jatropha curcas L) is one of various plants which easy to adapt with its environment to grow. It is able to grow in  the critical soil. The development of jatropha has been flarely implemented in 2005-2006. This is supported by several policies. However, these policies have not been achieved. For example, the KPEN-RP (Kredit Pengembangan Energi Nabati dan Revitalisasi Perkebunan) program which is existed today is not efficient yet. This caused by the high interest from the bank that must be paid before crop production. The farmers avoid to take high risk depending on the crop. Besides that problem, the other problems are collateral requirements, no guarantor for the disadvantages which farmers are the victims, and no market guarantee. All of those problems can be solved by agricultural infrastructure investment financing. The farmers or Gapoktan with dry land will be given the infrastructure investments (seed, fertilizer, pesticide). The role of government and the private sector here, besides as a provider of capital, are also as the market for Crude Jatropha Oil (CJO). Moreover, the farmers have to pay 20% of every the selling crop to pay off the infrastructure investment at the beginning. After payment is complete, farmers can still join with the institution program. This Financing will be monitored with high supervision so that it is properly used, and assistance and training directly to farmers in terms of production, human resource management and marketing.

My first abstract in English, actually still unsuccessful for a competition, but next time, InshaAllah.. pray the best for me guys...