Sector

Agriculture

Indonesia, with its archipelago of volcanic soil and plentiful rainfall, offers a natural abundance that sustains the nation and plays a crucial role in its economic prosperity. One of the country’s leading sectors is agriculture, supporting the livelihoods of millions and making a significant contribution to Indonesia’s Gross Domestic Product (GDP). From rice paddies to coffee plantations, this diverse range of crops reflects the country’s unique geography and climate, making it a powerhouse in the global agricultural market.

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Agriculture

Indonesia, with its archipelago of volcanic soil and plentiful rainfall, offers a natural abundance that sustains the nation and plays a crucial role in its economic prosperity. One of the country’s leading sectors is agriculture, supporting the livelihoods of millions and making a significant contribution to Indonesia’s Gross Domestic Product (GDP). From rice paddies to coffee plantations, this diverse range of crops reflects the country’s unique geography and climate, making it a powerhouse in the global agricultural market.

In 2022, Indonesia’s agricultural sector generated approximately Rp2.4 quadrillion in GDP. This sector alone accounts for 12.4 percent of the country’s GDP, underlining its importance to the national economy. The following year, the country experienced a steady growth rate of 1.3 percent in this sector.

Agriculture serves as a key sector for the national economy in various Indonesian provinces, including Aceh, North Sumatra, West Sumatra, Riau, Jambi, Bengkulu, and South Sumatra. Additionally, the provinces of Lampung, Bangka Belitung, West Java, Central Java, East Java, and West Kalimantan, among others, also consider agriculture as a key sector.

This sector offers a rich variety of commodities, including paddy, corn, soybean, sweet potato, and cassava – all staple commodities that play a vital role in sustaining Indonesia’s food supply. Additionally, crops such as cocoa, coconut, coffee, and palm oil are essential for export income and providing job opportunities. In terms of employment, the agriculture sector employs nearly 28 percent of the country’s workforce.

The country’s agricultural sector has also attracted significant foreign investment in 2023, with roughly US$2 billion in direct contributions. With this sector helping sustain Indonesia’s food supply, the country’s paddy production statistics that same year indicate that roughly 10.2 million hectares of land were harvested, yielding an estimated 56.63 million tons of dried unhusked rice (GKG). Once processed for consumption, this translates to approximately 30.9 million tons of rice available for the population.

In a move to strengthen its agricultural foothold within Southeast Asia, Indonesia seeks to expand cooperation with Vietnam in both agriculture and aquaculture. Indonesia and Vietnam are forging a partnership to modernize their agriculture and aquaculture industries. This collaboration will leverage digitalization for improved efficiency and invest in research and development to enhance the quality and global competitiveness of their agricultural and fishery products.

Latest News

March 5, 2026

The import bribery case implicating three customs officials has entered a new phase with the discovery of several safe houses in Jakarta, where investigators found a stash of money amounting to billions of rupiah. The emergence of what appears to be a sophisticated bribery network not only further erodes institutional credibility but also raises a deeper question: Can corruption at the Customs Office truly be eradicated?

The Corruption Eradication Commission (KPK) uncovered four apartment units in North Jakarta and a house in Ciputat, South Tangerang, Banten, that were being used as safe houses. Investigators seized gold bars and cash totaling Rp 40.5 billion (US$2.45 million) in multiple currencies including rupiah, United States dollars, Singapore dollars and Japanese from these locations, as well as from the offices of logistics firm Blueray Cargo and suspects’ residences.

During a series of sting operations on Feb. 4 in Jakarta and Lampung, the KPK arrested 17 Customs Office employees. A day later, it named six suspects including three customs officials: Rizal, who served as the enforcement and investigation director from 2024 to January 2026; Sisprian Subiaksono, head of enforcement and investigative intelligence; and Orlando Hamonangan, head of the intelligence section.

The three other suspects were Blueray Cargo executives: owner John Field, import documentation head Andri and operations manager Dedy Kurniawan. John surrendered to the KPK on Feb. 7 after initially attempting to evade arrest during the sting operations.

This graft case extends beyond a conventional bribery scheme, as it involves deliberate manipulation of the customs risk management system. Under normal procedures, imported goods are assigned to either the green channel, for low-risk shipments with minimal inspection, or the red channel, for shipments requiring detailed scrutiny.

However, investigators reportedly found that Orlando had ordered an adjustment to the scanning system’s setting by fixing a 70 percent parameter, which enabled Blueray’s shipments to be routed through the green channel regardless of their customs classification, including prohibited and restricted goods (LARTAS). As a result, various textile products marked as LARTAS, including counterfeit bags, shoes and branded clothing, were allowed entry without proper inspection.

At the same time, Blueray allegedly falsified import documentation to understate shipping volume and thereby reduce duties to around Rp 40 million per container, while it charged clients Rp 200 million in import fees.

Given that the firm reportedly handled 1,500–2,000 containers per month, the illicit customs scheme between October 2025 and January 2026 incurred enormous potential losses to the state through systemic revenue leakage. In return, customs officials involved in the scheme allegedly received monthly bribes of around Rp 7 billion between December 2025 and February 2026.

Investigators have uncovered additional violations in Blueray’s corporate structure. The company reportedly established at least 20 affiliated entities as nominal importers to mask the identities of the true importers. This violated regulations prohibiting a single entity from acting as both freight forwarder and importer, since such an arrangement would significantly complicate traceability and enforcement.

The broader economic context amplifies the seriousness of the case. Indonesia’s textile industry has been under pressure from dumping practices, particularly by Chinese firms, amid global overcapacity and weakening demand. These combined pressures have led to factory closures and layoffs, including at major firms such as textile manufacturer PT Sri Rejeki Isman (Sritex).

While Customs and Excise Director General Djaka Budi Utama has yet to make a public statement on the matter, the KPK has indicated it may summon him for questioning related to the potential involvement of senior officials.

The reoccurrence of graft cases has prompted Finance Minister Purbaya Yudhi Sadewa to issue a stark warning: The Customs Office must undergo fundamental reform within a year or face a potential institutional freeze. Alternatively, Purbaya has floated a possibility of stripping the office of its responsibilities and appointing an external operator like Société Générale de Surveillance (SGS), reviving an arrangement implemented under former president Soeharto in 1985–1997.

Given the apparent systemic corruption at the Customs Office, reintroducing external oversight through a credible organization may warrant rigorous consideration. While not a panacea, such a move could disrupt entrenched networks, restore business confidence and safeguard state revenues.

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