The changes and challenges in Indonesian agriculture and rural areas under theeconomic development: Special focus on job diversification and commercial farming

摘要

The purpose of this paper is to suggest the future direction of research activities regarding the challenges of Indonesianagriculture and rural areas by the way of reviewing past literatures focusing on job diversification of farmhouseholds and expansion of commercial farming. These two topics are outstanding features in the post green revolutionera. Agricultural policies in Indonesia have been strongly promoting commercial farming but its negativeimpacts are left to be resolved. A clear picture of the future direction of Indonesian agriculture under the job diversificationis not necessarily pointed out, either. Our review concludes that it is beneficial to know how farmersʼstrategies of farm management are being changed under the growing importance of off-farm jobs in order to predictthe further changes of Indonesian agriculture. This paper suggests two major directions for commercial agriculture,i.e., large scale farming for cost reduction and production of high value commodities. Oil palm plantation, as a typicalexample of large scale farming, faces various conflicts with local communities, despite its profitability. It isnecessary to identify how the collaboration between plantation companies and small scale farmers can be achievedin order to harmonize oil palm production with sustainable environment and society. Though production of highvalue commodities can be an effective tool to increase farmersʼ income, it is crucial to develop a market channelfor the high value commodities to realize its potential profitability. Support and assistance by the government willbe required to involve small scale farmers in this market development.