Asian Agri Subsidiary Helps Empower Transmigrant Farmers

Today, more than 400 transmigrants originally from the island of Java have found successful livings as palm oil farmers working in a plasma partnership scheme with the Asian Agri company PT Inti Indosawit Subur in the Siak Regency of Sumatra’s Riau Province. For example, one of these farmers now earns approximately 40 million Indonesian rupiah per month, the equivalent of more than $3,000 in U.S. dollars. In addition, many of these farmers have used their profits from the plasma partnership to purchase lands outside those they farm on behalf of Asian Agri. This business cycle helps sustain community development on a larger scale as well.

The controversial practice of transmigration, recently a World Bank-supported program, began its first wave more than a century ago. The practice has aimed to solve the problem of overcrowding on densely populated Indonesian islands such as Java and Bali; Java alone accounts for around 60 percent of Indonesia’s total population. People from these islands relocated to forested and less-populated areas on Sumatra, Sulawesi, and other islands. Over the years, Asian Agri and Inti Indosawit Subur have provided extensive information and training to assist transmigrants who are new to farming.

Today, Inti Indosawit Subur has placed 60,000 of its 170,000 hectares of palm plantation land into the plasma partnership program for cultivation by Javanese-born farmers, who relocated to the area through transmigration programs in the 1990s. The farmers cultivate their share of the land to produce the raw palm oil and sell it back to the refining company. Thanks to their participation in the partnership, these farmers now collectively hold billions of rupiah in assets.

Asian Agri is one of the companies under the $15 billion RGE Group corporate banner. Founded by entrepreneur Sukanto Tanoto more than 40 years ago, RGE continues to emphasize sustainable agricultural and forestry practices within its natural resources manufacturing operations.