Village Funds in Indonesia: Impacts on Sustainable Agricultural Development

¹ Department of Agribusiness, Faculty of Agriculture, Universitas Pembangunan Veteran Yogyakarta, Indonesia
² Global Value Chains Working Unit, Ministry of State-owned Enterprises, Jakarta, Indonesia
³ Education, Public Policy, and Equity, School of Education, University of Glasgow

^1* Corresponding author: paksi.meipenggalih@upnyk.ac.id

Abstract

This study examines the implementation of village funds allocated by the Indonesian government to boost agricultural growth in rural regions, with a focus on promoting sustainable farming practices among its 270.2 million populace. Utilizing a descriptive qualitative method and secondary data analysis, our findings underscore the crucial role of infrastructure development in improving access to agricultural production and distribution facilities. Although village funds have significantly bolstered the physical infrastructure facilitating farming operations, enhancing institutional frameworks, and spurring complementary agricultural ventures, our analysis indicates a disproportionate emphasis on infrastructure over human capital investments. As agriculture remains a dominant economic pursuit in rural Indonesia, it is vital that future allocations strike a balance between infrastructure and human resources. An integrated approach not only promotes food self-sufficiency and rural livelihood enhancements but also aligns with sustainable development goals, emphasizing the importance of empowering SMEs and the broader agricultural sector.