New Kalimantan mega-project will not proceed

Down to Earth No. 45, May 2000

The government has decided that the repackaged Kalimantan mega-project will not after all go ahead, due to the huge problems the original project created. The disastrous million hectare project to convert peat swamp forests to rice-fields was launched in 1995 but was finally halted last year after the catastrophic environmental impacts became obvious. The new project, known by its acronym Kapet DAS Kakab (the Kahayan, Kapuas and Barito Rivers Watershed Integrated Development Zone) covered a huge 2.7 million hectare area and was launched by the Habibie government in 1999 (see DTE 42 and DTE 43).

Earlier this year President Wahid's government decided to continue with a scaled down version of the project, despite its lack of the legally required environmental impact assessment.

In April, however, the minister for housing and regional development, Erna Witoelar, announced that the project would no longer go ahead as the losses outweigh the benefits. She made the announcement at the village of Dadahup, which was chosen as the focus of WALHI's Earth Day celebrations in mid-April. Local Dayak Ngaju people held a traditional ceremony to appease forest spirits angered by the damage caused during the mega-project development. They also issued a statement demanding recognition of land rights, compensation and damage rehabilitation.

Transmigrants sent to the project also made a statement, which said they were willing to be sent back to their original homes and supported the Dayaks' claims to land and compensation. (The statements and translations will be posted on the campaigns section of our website in the near future.)

The transmigration department sent 63,000 people to the project site, where promises of fertile land and a good living were soon proven to be false. The acidic ground water is undrinkable, the hydrology of the peatlands has been irreparably damaged by the inappropriate drainage scheme and now a plague of rats is eating up the few crops the struggling farmers have managed to grow.

An attempt to send another 16,000 transmigrants to the site was abandoned after protests from Dayak groups. Transmigration minister Al Hilal Hamdi has said that Rp 10 billion (US$1.3 million) had been paid in compensation during the presidency of Suharto's successor, Habibie, but has admitted that the money had not gone to enough of those who had lost their land. He said the government could not afford to pay the 27,000 claimants the Rp 200 billion (US $26.3 million) they are demanding. but that the project should proceed.


Investigations are continuing into the suspected embezzlement of billions of Rupiah of mega-project funds. The Kapuas district prosecutor, HM Toyib says his office has tried to summon Tay Juhana, the boss of PT Sumatera Timur Indonesia (STI), the project's main contractor, but that so far he has failed to appear, claiming he is ill. There are five other suspects in the case, including former public works minister Radinal Mochtar, who have also said they are too ill to attend hearings. STI is accused of defrauding the government of Rp 126 billion (US $ 17 million) during the construction of 100km of drainage channels. Other work associated with the project probably embezzled further funds. However, the district assembly is putting pressure on the judiciary to drop the case against PT STI, arguing that work on the project will not be able to continue if the case drags on. Central Kalimantan's caretaker Governor Rapiuddin Hamarung has even asked this same discredited company to resume the project. The district and provincial prosecutors have criticised the assembly's "intervention in the supremacy of the law" and are refusing to back down.

(Indonesian Observer 30/Mar/00, 27/Apr/00; Banjarmasin Post 8&17/Feb/00, 10/Mar/00; Suara Pembaruan 2/Mar/00; Indonesian Observer 1/Mar/00; Antara/Asia Pulse 25/Apr/00)