Indonesia plans to channel carbon market funds to farmers and coastal communities

Indonesia’s carbon market strategy was outlined by Coordinating Minister for Food Affairs Zulkifli Hasan during the Indonesia Sustainability Forum in Jakarta. He explained that the upcoming carbon financing framework will allocate funds to small-scale farmers, fishers and other coastal communities, not just large corporate players. Under Presidential Regulation No. 110 of 2025 and its supporting rules, the market will combine carbon trading, taxation and result-based payments.

To date, four forestry projects have been registered, delivering an estimated emission reduction of 30 million tonnes of CO₂e and a transaction value of about Rp5 trillion. These initiatives could also produce roughly Rp500 billion in non-tax revenue for the state. Hasan stressed that ensuring inclusivity is essential for the carbon market to translate environmental preservation into tangible income for grassroots managers.