Padang, W Sumatra (ANTARA) - Agriculture Minister Syahrul Yasin Limpo has asked regional governments to optimize the utilization of people's business credit (KUR) for the financing of various agricultural programs.

"Provincial, district, and city governments must change the financing mode, which, so far, has been very dependent on the state budget by involving the participation of banks and private (parties)," he said here on Saturday.

Limpo made the statement at the XVI Indonesian Farmers and Fishers National Week (Penas Tani), which is being held from June 10 to 15, 2023, at the Sutan Sjahrir Air Base, Padang, West Sumatra.

The regional budget (APBD) can only be used up to a maximum of 20 percent of the existing potential, he explained.

"To this end, the absorption of funds from banks through the existing KUR scheme must be rolled out," he said.

The minister noted that in 2022, the absorption of KUR in the agriculture sector reached Rp113.43 trillion (around US$7.61 billion) or 126.4 percent of the target of Rp90 trillion (around US$6.04 billion), with 2.7 million debtors.

For 2023, Rp100 trillion (around US$6,71 billion) is targeted to be absorbed in the agriculture sector. As of June 10, KUR absorption has reached Rp25.12 trillion (around US$1.68 billion) or 25.12 percent of the target, with the number of debtors pegged at 532,321.

The Ministry's Director General of Agricultural Facilities and Infrastructure Ali Jamil affirmed that his ministry has continued to build and strengthen joint commitment with the State-Owned Banks Association (Himbara), regional banks, the Agriculture Instrument Standardization Agency (BSIP), governors, and mayors for KUR absorption.

Jamil said that each governor has committed to absorbing Rp100 billion (around US$6.71 million) from KUR and agricultural tools and machines business credit (KUA).

Meanwhile, mayors and district heads have committed to absorbing Rp50 billion (around US$3.35 million) from KUR and KUA, he added.

He further informed that, through the commitment, the absorption of KUR in the agriculture sector would reach Rp30 trillion (around US$2.01 million) at least.

Apart from that, in 2023, the absorption of KUR for the purchase of agricultural tools and machines (Alsintan) has reached Rp9.5 billion (around US$638 thousand), he noted.

The tools include combine harvesters and four-wheeled tractors, among others.

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Translator: Muhammad Zulfikar, Raka Adji
Editor: Azis Kurmala
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