POLITICAL ECONOMY OF AGRARIAN CHANGES:
UNDERSTANDING INDONESIA’S AGRARIAN PROBLEM
THROUGH COMPARISON OF MODERNIZATION AND DEPENDENCY THEORIES*)
Ekonomi Peninggalan Belanda:
Sistem ekonomi Indonesia setelah kemerdekaan masih merupakan warisan Pemerintah Kolonial Belanda yang sifatnya dualistik terutama di Pulau Jawa. Dengan mundurnya pemerintah kolonial tidak ada lagi impor bahan pangan dan tugas berat harus dipikul oleh sektor pertanian tradisional di pedesaan untuk memenuhi kebutuhan pangan seluruh negeri sementara pertaniannya masih bersifat subsisten. Di sisi lain, tinggal administratur dan staf yang belum berpengalaman mengambil alih perkebunan-perkebunan yang ditinggalkan Belanda, dibebani dengan kurangnya modal dan hubungan yang tidak pasti dengan pasar eskpor. Karena itu ekonomi Indonesia menuju keruntuhan mulai pertengahan 1960-an, dan pada periode 1965-1966 inflasi telah mencapai 600 persen.
Pandangan Modernisasi versus Ketergantungan:
Dari sudut pandang Teori Modernisasi, situasi di atas tipikal: “terbelakang” dan “belum berkembang”, dicirikan dengan produksi yang subsisten, perekonomian yang sederhana dan tidak bervariasi, produktivitas yang rendah, dan lain-lain. Sementara dari sudut pandang Teori Ketergantungan, Indonesia bisa diibaratkan sebagai “satelit yang terlepas dari orbitnya”. Akibat menjadi koloni selama berabad-abad, ekonomi Indonesia terperangkap pada jaring ekonomi kolonial dalam struktur hubungan pusat dan pinggiran. Kemerdekaan merupakan kejutan bagi Indonesia, yang melepaskan struktur dan memutuskan hubungan dengan pusatnya sehingga menimbulkan ketidakstabilan.
Pertanian yang Dualistik:
Sesungguhnya modernisasi pertanian Indonesia sudah mulai dirintis sejak pemerintahan Sukarno melalui apa yang dinamakan program INMAS dan BIMAS. Hal yang perlu diketahui mengenai program INMAS dan BIMAS adalah, bahwa itu merupakan paket teknologi penanaman padi yang menggunakan intensifikasi dan sarana produksi (pupuk, pestisida) dalam kadar yang tinggi, ditranfer melalui bantuan dana dan tenaga ahli dari Amerika Serikat. Selanjutnya Sektor Pertanian tetap menjadi prioritas utama dalam Rencana-rencana Pembangunan Lima Tahun (REPELITA) Suharto yang berlangsung sejak tahun 1969. Penekanannya tetap pada peningkatan produksi didukung oleh perbaikan irigasi dan sistem transportasi. Produksi padi menjadi semakin sistematis dan termekanisasi dalam sekala besar melalui apa yang disebut program INSUS, yaitu kombinasi dari mobilisasi kelompok-kelompok tani dengan implementasi paket teknnologi. Hasilnya cukup memuaskan, produksi padi meningkat rata-rata 4,5 persen per tahun antara tahun 1968 sampai 1987. Secara resmi Indonesia telah swasembada beras sejak tahun 1984. Fenomena dan pengalaman Indonesia di atas menggambarkan bagaimana pendekatan modernisasi dapat secara progresif mencapai tujuan tertentu. Di lain pihak, dari pandangan argumentasi ketergantungan, apa yang disebut keberhasilan dalam modernisasi pertanian Indonesia pada saat yang sama membawa pula masalah-masalah lain yang bersifat struktural. Masalah saat ini lebih komplek sifatnya, meliputi isu-isu ekonomi, sosial, dan budaya. Praktek-praktek dari modernisasi pertanian dalam kenyataannya hanya meneruskan ketergantungan yang berlanjut pada bantuan luar negeri tanpa memecahkan akar permasalahannya. Pada saat yang sama memberi kesempatan penetrasi yang lebih dalam dari berbagai bentuk ketergantungan. Lebih dari itu, menciptakan pula ketidakharmonisan sosial yang bersifat struktural dalam bentuk ketidakmerataan dan kesenjangan sosial-ekonomi yang lebar
Untuk mencapai tujuan-tujuan pembangunan yang hakiki, revisi strategi harus dirumuskan untuk mengarahkan kembali proses perubahan-perubahan di Sektor Pertanian. Sebagaimana antosiasme terhadap modernisasi, nilai-nilai dan teknologi tradisional harus pula dilihat sebagai unsur yang progresif dalam pembangunan terutama pada kondisi lokal yang spesifik. Implementasi dari unsur-unsur paket “revolusi hijau” harus dikombinasikan dengan teknologi lokal-tradisional yang ada sehingga memberikan hasil yang optimal. Hal itu juga untuk meminimalkan derajat ketergantungan pada sumberdaya asing di satu sisi dan juga untuk mewujudkan pertanian yang berkelanjutan. Pada akhirnya, itu juga akan menstabilkan kemampuan swasembada pangan nasional dan menciptakan produktivitas pertanian yang wajar sebagai basis perekonomian untuk pembangunan selanjutnya. Lahan pertanian jangan hanya dinilai sebagai aset usaha atau alat untuk menciptakan surplus ekonomi, akan tetapi harus diperlakukan sebagai aset yang dinamis untuk pemerataan pendapatan dari rakyat yang berkerja di Sektor Pertanian. Peraturan-peraturan reformasi pertanian harus dirumuskan kembali dan diterapkan secara konsekuen. Pada kondisi tertentu di mana pemilikan lahan sangat timpang, reformasi lahan atau pembatasan pemilikan lahan harus diberlakukan. Akhirnya, segala bentuk kerjasama asing atau internasional harus dipelajari dan diseleksi dalam kontek memperkuat kemandirian nasional, tidak hanya dilihat sebagai sumber untuk pertumbuhan ekonomi sementara pada saat yang sama juga menyedot sumberdaya alam dan surplus ekonomi ke luar negeri. Dengan arah strategi ini diharapkan masyarakat petani yang moderen, merdeka, adil dan makmur akan menjadi kenyataan.
Naskah asli dari artikel ini adalah sebuah Tutorial Paper yang ditulis sebagai salah satu syarat untuk lulus dalam Mata Kuliah “Alternative Approaches to the Analysis of Agrarian Questions” - salah satu mata kuliah yang diikuti oleh Penulis sewaktu menyelesaikan program Master of Arts (MA) dalam Bidang Studi Pembangunan di Institute of Social Studies (ISS), The Hague, Negeri Belanda tahun 1991/1992. Naskah tersebut ditulis kembali untuk disesuaikan ke dalam format artikel jurnal. Artikel ini dibuat ringkas akan tetapi bermaksud untuk memberikan analisa yang kritis berkenaan dengan masalah-masalah dan perubahan-perubahan di Sektor Pertanian Indonesia sejak zaman kolonial sampai masa kemerdekaan - tahun 1990-an. Perspektif analisanya adalah Ekonomi Politik, terutama ditinjau dari Paradigma Teori-teori Modernisasi dan Ketergantungan. Data dan analisa yang disajikan dalam artikel ini akan bermanfaat bagi yang ingin tahu tentang latar belakang masalah dan perubahan-perubahan di Sektor Pertanian Indonesia, begitu pula bagi yang berminat untuk mempelajarinya lebih jauh. Bekasi 30 Juli 2001.
THE ORIGIN OF INDONESIA’S AGRARIAN PROBLEM,
MODERNISATION AND DEPENDENCY THEORIES
Agrarian problem in Indonesia since colonial period has been the inability of agricultural sector to provide sufficient food for the population although almost three-quarter of the population lived from agricultural sector. During the pre-war period of the colonial rule (1921-1940), an average of 460 thousand tons of rice had to be imported annually. The rice imports were even greater after 1945 (the year of independence), rising to 763 thousand tons in 1956. Between 1940 and 1965 there had been a 150 percent increase of rice yield, but during that period population had also increase in at least the same proportion. Export of agricultural product was either not significant to the economy. Even showed ever declining trends in quantity, quality and price of products since 1955. (For more detail information and data, see T. Hadiwidjaya, in H.W. Beers,1970: p. 19).
The rural economy during early independence period was characterized by mixing of estates and small holders’ crops production. Besides native land, considerable number of small land holding was gained through squatting abandoned estates. In some cases, estates were forced by the government to give up reserved land for native occupation. However this “land reform alike” was only a political rhetoric rather than a massive, planned and systematic one. So it did not restructure the pattern of land-ownership throughout the country. On the other side, estates were maintained to continue colonial style production. So rural peasantry during this particular time played dual function, to provide labour for estates and to produce food-crops mainly for national consumption (This matter is broadly explained by G.C. Allen and A.G. Donithorne, 1957: Ch. III.)
Later evident proved that economic and social system in Indonesia was still inheritance of the Dutch Colonial Government, as economically dualistic and class oriented. Especially in Java island, since 1926 the Dutch Colonial Government inherited the following structure of population (See Sritua Arief and Adi Sasono, 1980: p. 67.): Rural Poor 62.5 percent; Average Peasants 19.8 percent; Traders, craft-men, small industrialist, village officials, employees of business enterprises, teachers, and others 15.2 percent; Rich Peasants and Landlords 2.5 percent. This structure was still predominant in Indonesian traditional agricultural sector after independence. The agricultural production relations composed owner-cultivator, tenant-cultivator, and agricultural labourer. This composition embodied a dualistic system of production. The peasant units carried on their production to meet their subsistence requirements. The capitalist agricultural units carried on production to maximize marketable surplus and part of the surplus was invested for expansion or invested in other sectors. The peasants together with the agricultural labourers occupied the lowest stratum in the Indonesia’s traditional agrarian society (Ibid.: pp. 75-76).
Looking at the performance of economy of the country in general and the rural social and economic structure at that time, one can simply imagine how chaotic the rural life was. Indeed the country’s economy had never been improved and in the state of collapse by the middle of 1960. During 1965-1966 when Communist Party tried to take over the country (but unsuccessful), inflation had reached 600 percent (See B. Hawn, 1982: p. 5).
One can explore the vicious cycle of Indonesia’s agrarian problem during the above specific period. More than three and half centuries being colonized,1 seemed fair enough to be blamed as causal factor. By the withdrawal of the colonial ruler, there was no rice imported. Heavy task should be borne by the traditional-rural agriculture to suffice the country’s food requirement while it was still subsistence agriculture. On the other side only inexperienced managers and staffs took over the abandoned estates besides lacked of capital and uncertain link to export market (See T. Hadiwidjaya in H.W. Beers, 1970: pp. 19-20; G.C. Allen and A.G. Donithorne,1957: pp. 75-76 and also B. Higgins,1957: pp. 65-68).
From point of view of Modernization Theory, the above situation is typical “backward” or “underdeveloped”, characterized by “subsistence production, simple or undifferentiated economics, low productivity”,etc (D. Dunham: p. 5). While from the view of Dependency Theory one can suppose the country like a “satellite slips from the orbit”. Being colonized for centuries had completely tied the country’s economy into the network of the “colonial-metropolis’ economy” within its “centre-periphery” structure and relationship. Independence was a “shock” to the country, which break the structure and cut relationship with the centre and brought about instability.2
After pursuing national development for about 18 years, since 1984 Indonesia has been able to supply its domestic food requirement (Department of Information Republic of Indonesia, 1990/1991: p. 118). Export from agricultural sector has also made contribution to the national income (see BPS, 1990: p. 298). “Agricultural intensification” as one of modernization paths has played an important role. Is it in the same time bringing in the elimination of all agrarian problems? Does the so-called economic achievement of the ex-colonized countries or Third World Countries in general also mean “independent” from the World Capitalist System of the ex-colonizer countries? Next part will try to explore and answer these questions.
II. MODERNIZATION AS A PROGRESSIVE DEVELOPMENT APPROACH
Experiencing unsuccessful economic development during President Sukarno’s government, President Suharto who played important role in defeating 1965 Communist Party coup and assumed power in 1966 laid down the new strategy for continuing development. The government’s initial economic priorities were stabilization, in particular the reduction of inflation, the restoration of government finance and rehabilitation of the productive base of the economy. Greater encouragement was given to the operation of market forces, foreign investment was invited and foreign aid actively sought (See B. Wawn,1982: p. 5).
Actually agricultural modernization had been pioneered during collapsing period of President Sukarno’s government. That was under the framework of 1961-1969 outline of development plan, accepted by the Congress on December 3, 1960 (T. Hadiwijaya in H.W. Beers, 1970: pp. 19-20). Great attempts were made to get agriculture moving. The first step was launching the so-called INMAS programme (mass intensification programme) through paddy centres and BIMAS programme (mass guidance programme) (Ibid.: p. 20). The important note regarding the INMAS and BIMAS programme that it was a highly “input-intensive” package of technology for paddy cultivation transferred through assistance of American aids and expertise. The plan also called for continued expansion of irrigation and systems or mechanized rice farming (See L.A. Mears in H.W. Beers,1970: pp. 37-52). The plan to make Indonesia self-supporting in rice was not fulfilled. During the period of 1961-1964 more than one million tons of rice were imported annually, only 186 thousand tons in 1965 and in 1966 increased again to 275 thousand tons (T. Hadiwidjaya in H.W. Beers, 1970: pp. 21-22). The establishment of the IPB (Bogor Agricultural Institute) in September 1963 was a landmark in the development of higher agricultural education. The development of this institution was facilitated by affiliation with the University of Kentucky (Ibid.: p. 24).
Agricultural Sector still became the main priority in the President Suharto’s Five Year Development Plans (REPELITA), took course since 1969. The emphasis was still increasing agricultural produce and improving irrigation and transportation systems. The rice production became more systematic and mechanized in large scale through so-called the INSUS programme, that is combination of mobilization of farmers’ group with implementation of technology package. The result was satisfying; the production of paddy rose with an average of 4.5 percent annually, namely from 17.2 million tons in 1968 to 41.7 tons in 1987. Officially Indonesia has already been self-sufficient in rice since 1984 (Department of Information Republic of Indonesia, 1990/1991: p. 97 and 118).
The above phenomenon on Indonesian experience illustrates how modernization approach can progressively achieve a certain objective. The green revolution as one of modernization paths is indeed a package of requirements, consisted of: “Applied
Technological Research (improvement of seed varieties, fertilizer experiments, insecticide and pesticide experiments); Improvement in Infrastructure (irrigation, drainage, flood control, transportation); and Institutional Innovation (education including extension service, organization appropriate for marketing and finance including co-operative, land reform)” (See L.A. Mears in H.W. Beers, 1970: p. 38 and for comprehensive study, see A.T Mosher, 1966). The problem for any developing countries is how to achieve these complementary investments. The second problem is how to secure even development and equal distribution of those elements of the package. Further questions arise as to the pricing policies and social or economic implication contradict the genuine development aims (Arose by L.A. Mears in H.W. Beers, 1970: p. 38).
Reality faced by Indonesian experience, to complete all requirements of the green revolution package has been almost impossible without foreign assistance both in term of financial aids and expertise.3 Fortunately, the “oil boom” beginning in 1973 contributed significantly to the country’s economy. During the period of 1973 to 1984, development expenses had exceeded the budget plan. This was partly because of the increase in the state revenues obtained from crude oil export (Department of Information Republic of Indonesia, 1990/1991: p. 98). There was evidence that a massive transfer of investment capital or subsidies from mining sector to agricultural sector had fulfilled main requirements needed for the green revolution process.
Even up to now, while the so-called food self-sufficiency has been achieved, a great amount of subsidies still must be provided to match the price of production inputs (fertilizer and pesticide) to the farmers’ purchasing capacity.4 On the other side, studies carried out on assessment of the green revolution noted that inequitable distribution of assets and income especially in dualistic rural communities has been aggravated (See Y. Hayami in C.K. Eicher & J.M. Staatz, 1984: pp. 389-390). Do this indicate that “linear stage model”5 seems likely not to occur in Indonesian case ? This perhaps should be seen from different analytical point of view, which will be discussed in next part.
III. DEPENDENCY THEORY,
A CRITICISM TO THE MODERNIZATION APPROACH
Colonialism had been very coherent with “dependency and underdevelopment” process in Indonesia (Eessential reflection from A.G. Frank in J.D. Cookcroft, A.G. Frank and D.L. Johnson, 1972: Ch. 1 and 2). For example forced cultivation system (cultuurstelsel), introduced and first implemented by the Dutch in Java (1830-1870) has been agreed as the main form of exploitation responsible for underdevelopment and backwardness of a great portion of the Indonesian people (See Sritua Arief and Adi Sasono, 1980: pp. 57-58). The abolition of forced cultivation system in 1870 was followed by the inflow of private Dutch capital into Indonesia to continue their extraction of the Indonesian wealth. Large plantation of primary commodities in Java and East Sumatra emerged as “enclave” sector within the economic structure of Indonesia. The negative affects created were essentially the same in terms of a massive transfer of economic surplus from Indonesia to the Netherlands. Mining and other extractive units had also become main source of surplus extraction (Ibid.: p. 62). Cheap labour for operating the large plantations came from the peasant masses who had become proletariat class as a result of the system of forced cultivation. Lands, which were leased out, belonged to the feudal lords from the aristocratic class (Ibid.: pp. 62-63).
It was upon this dualistic structure Indonesia began to give substance to its independence. Under the post-1966 government a complete open-door policy was adopted to invite foreign capital. Social restructuring to alter inter-class relation was not present. These realities of the Indonesian economy and society, which grew upon this dualistic structure, can be considered as point of departure to apply the dependency and underdevelopment thesis (Ibid. pp. 70-71).
Sritua Arief and Adi Sasono (1980: Ch.I/p.4.) used the components of growth process, employment, industrialization process, financing of development, and production of food to analyze Indonesia’s process of dependency and underdevelopment. Within that model the effect of the green revolution programme can be explained by models of employment and surplus generation.
According to the employment model, the capitalist farming units are largely responsible for the existence of unemployment while the peasant units are responsible for the pool of rural-underemployment. The peasant units will also be responsible for unemployment if the limit of accommodating rural labour force is already reached. This situation has been observed in rural Java (Ibid.: p. 79). The reduction of labour absorption with the expansion of the capitalist mode of production through the green revolution programme will tend to aggravated income distribution (See Y. Hayami in C.K. Eicher & J.M. Staatz, 1984: pp. 389-390 and also Sritua Arief and Adi Sasono, 1980: p. 79).
Surplus generating model concludes that modern technology introduced to the traditional agricultural sector which was hoped to increase the level agricultural productivity has also resulted in the decline in the employment of the rural labour force (Sritua Arief and Adi Sasono, 1980: p. 83). The large farm having greater control over the supply of scarce agricultural resources, higher credit-worthiness and technical dynamism, will have more change to the benefit from opportunities offered. With a given access to new technology, the large farmers benefit much more than those having small land-holdings. Given the existing agrarian structure, large farmers will always benefit from the capitalistic process of agricultural development and this process is therefore bound to create a wider gap of incomes between the large and small-marginal farmers despite a rapid increase in agricultural production. The situation will worse if large farmers substitute capital for labour where technology is no more resource-neutral. Inequality of landholding and labour-saving technology then become the two main determinants of inequality income and poverty in the traditional-agricultural sector (Ibid.: pp. 82-83).
From the above elaboration, one essence can be picked up. The so-called success in Indonesian agricultural modernization at the same time brings about other structural problems. This problem is not less fundamental than hunger and poverty existed during colonization period. Because the present problem is more complex, including economic, social and cultural issues that unfortunately take place during independence era. The practices on modernization in reality are only pursuing continuos dependency on external assistance without finding its internal roots. At the same time it gives opportunity to further penetration of dependency in various form. On the other side it also creates a more structural social disharmony, in term of wider social-economic gap and inequality. The rich people get richer, while the poor people remain poor or even get poorer.
To achieve genuine development aims, “the justice and prosperity for all the people”, a revised strategy should be reformulated to redirect the process of agrarian change in Indonesia.
As well as progressive attitude toward modernization, traditional values and technology should also be seen as a progressive element of development, particularly given the specific local condition. The implementation of elements of the “green revolution” package should be combined with traditional-local existing technology that will result in optimal achievements. This also in orders to minimize the degree of dependency on foreign resources on one side, and also to attain optimal sustainability of the agriculture. At the end, it will also stabilize the national capacity on food self-sufficiency and creating optimal productivity of agriculture as the basic economic sector for further development.
Land should not only be valued as a private assets or means for creating economic surplus, but should be treated as productive dynamic asset of income distribution for the people involved. The slogan “land for the tiller” is still relevant and meaningful. The agrarian reform acts must be reformulated and duly realized. For certain condition where land ownership is extremely unequal, land reform or limitation of land ownership must be introduced.
Lastly, every kind of international and foreign co-operation should be examined and selected within the context of strengthening the national self-reliance, not simply be sought as the source of means for economic growth, while at the same time only siphoning natural resources and economic surplus abroad. In this direction, hopefully a “modern, independent, just and prosper” agrarian society will become a reality.
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Dutch established the Dutch East Indies Company (VOC) in 1602. Then there was a period of war against the Dutch and until 1799 all Indonesian territories were taken over by the Dutch Administration in Batavia. When France occupied Holland, Indonesia fell under the rule of the British East India Company (1811-1816) and after the fall of Napoleon the British returned Indonesia to the Dutch Administration in 1815. Japanese invaded the Dutch East Indies and the colonial army surrendered. After persistent demands, the Japanese agreed to place the civil administration of the country in Indonesian hands. This was a golden opportunity for nationalist leaders to prepare for the proclamation of Indonesia’s independence in August 17, 1945. (Source: Department of Information Republic of Indonesia, 1991)
The term of “satellite-metropolis” and “centre-periphery” are used by A.G. Frank to explain the Development and Underdevelopment Theory. For further study see J.D. Cookcroft, A.G. Frank and D.L. Johnson (1972), pp. 65-68.
United States Agency for International Development (USAID) has been the major source of financial aids and experts for agricultural development projects in Indonesia (T. Hadiwijaya in H.W. Beers, 1970).
Up until 1989/1990 the amount of subsidy is 278 billion Rupiahs or 0.65 percent of the Budgeted Government Expenditures. See BPS (1990), pp. 439-441.
As theorized by Rostow