The Indonesian Ministry of Agriculture is leading a nationwide initiative to provide local farmers and agricultural organizations with agricultural machinery, including rice transplanters, combine harvesters, dryers and packaging machines, free of charge, using national budget funds. The goal is to address labor shortages and improve production efficiency, with the aim of achieving self-sufficiency and improving yields of staple crops, especially rice.
The program will accelerate the mechanization and modernization of rural agriculture by enabling farmers to use machinery, thereby reducing working hours, cutting costs and increasing yields.
However, the need to establish systems for machine maintenance, repairs and parts procurement has also been highlighted, making the subsequent operation and maintenance of machinery crucial as well as its initial introduction. Consequently, the Indonesian agricultural machinery market is entering a phase where opportunities for entry and expansion are increasing for agricultural machinery manufacturers, parts suppliers, and service companies from the perspectives of ‘boosting demand + regional expansion + maintenance/rental services’.
Source: BPS-Statistics Indonesia
PSR Analysis: Although no specific figures have been disclosed regarding the scale of distribution, past statements from the Ministry of Agriculture suggest that the 2025 ALSINTAN (Agricultural Tools and Machinery) agricultural machinery subsidy budget is being prepared at around Rp10 trillion (approximately USD 700–800 million).
Furthermore, reports have mentioned plans to ‘deploy 5,399 ALSINTAN units ahead of the harvest season’. This suggests a large-scale initiative involving several thousand to ten thousand units. This free distribution is a significant catalyst for advancing mechanization and demonstrates the country’s commitment to agriculture. PSR
Akihiro Komuro is Research Analyst, Far East and Southeast Asia , for Power Systems Research
