Omnibus Law and the Challenges of the Indonesian Agricultural Sector: an Islamic Perspective
Keywords:
omnibus law, agriculture sector, foreign investment, islamic perspective
Abstract
In late 2020, the Indonesian Parliament enacted the Job Creation Law, known as the "Omnibus Law," which introduced significant amendments to various sectors, including agriculture. The law aims to boost food trade and increase private sector involvement in enhancing agricultural productivity. However, critics argue that the law disadvantages farmers by deprioritizing local agricultural products and heavily relying on imports to meet domestic food supply needs. Additionally, the law removes restrictions on foreign investment in horticulture and establishes a land bank to manage and redistribute idle lands. This article aims to analyze the impact of the Omnibus Law on Indonesia's agricultural sector, assessing its implications through both descriptive analysis and an Islamic perspective. A descriptive analysis approach was employed to compare the Omnibus Law with previous agricultural laws. The study evaluates the substance of the law, its effects on the agricultural sector, and its alignment with Islamic principles. The analysis reveals significant changes in agricultural policies, including increased reliance on imports, reduced prioritization of local products, and expanded foreign investment opportunities. These shifts present challenges for farmers and raise concerns about the sustainability of Indonesia's agricultural sector. By incorporating an Islamic perspective, this study highlights the need for a balanced approach that ensures fairness for farmers while supporting national agricultural productivity. The findings suggest policy adjustments to better align the Omnibus Law with sustainable and inclusive agricultural development in Indonesia.
References
Akhlas, A. W., Ghaliya, G., & Aritonang, M. S. (2020). Indonesia delays deliberations over labor issues in omnibus bill amid backlash. The Jakarta Post, 25 April 2020. Retrieved from https://www.thejakartapost.com/news/2020/04/24/govt-housedelay-deliberations overlabor-issues-inomnibus-bill-amid-backlash.html
Amanta, F. (2021). The Cost of Non-Tariff Measures on Food and Agriculture in Indonesia. Policy Paper No. 36. Jakarta: Center for Indonesian Policy Studies.
An-Nabhani, T. (2000). The Economic System of Islam (4th ed.). London: Al-Khilafah Publications.
Anggraeni, R., & Rachman, C. I. L. (2020). Omnibus Law in Indonesia: Is That the Right Strategy? In International Conference on Law, Economics and Health (ICLEH 2020) (pp. 180–182). Atlantis Press.
Asian Development Bank. (2019). Policies to support investment requirements of Indonesia’s food and agriculture development during 2020-2045. https://doi.org/10.1111/fcre.12450
Astuti, E. S. (2020). The Omnibus Law on agriculture: Why farmers are getting angry. Independent Observer, 17 March 2020. Retrieved from https://observerid.com/the-omnibus-law-on-agriculture-why-farmers-are-getting-angry/
Bengtsson, M. (2016). How to plan and perform a qualitative study using content analysis. NursingPlus Open, 2, 8–14. https://doi.org/10.1016/j.npls.2016.01.001
Black, H. C. (1990). Black’s Law Dictionary (6th ed.). St. Paul Minn: West Publishing Co.
Borhan, J. T., & Aziz, M. R. A. (2009). Agriculture And Its Contribution From The Islamic Economics Perspective. Jurnal Teknologi, 50(1), 69–86. https://doi.org/10.11113/sh.v50n1.277
Carvalho, N., Casey, J., Guillen, J., & Rodgers, P. (2020). Characterising investments in EU fisheries and defining their desirability. Fisheries Research, 221, 105396. https://doi.org/10.1016/j.fishres.2019.105396
Center for Indonesian Policy Studies. (2020). CIPS Celebrates Policy Changes Freeing up Indonesian Agriculture! Newsletter, 7 October 2020. Retrieved from https://www.cips-indonesia.org/post/newsletter-cips-celebratespolicy-changes freeing-up-indonesian-agriculture
DPR-RI. Undang-Undang Republik Indonesia Nomor 29 Tahun 2000 tentang Perlindungan Varietas Tanaman (2000). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/UU_2000_29.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 31 Tahun 2004 tentang Perikanan (2004). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/32.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 41 Tahun 2009 Tentang Perlindungan Lahan Pertanian Pangan Berkelanjutan (2009). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/UU_2009_41.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 13 Tahun 2010 tentang Hortikultura (2010). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/UU_2010_13.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 19 Tahun 2013 Tentang Perlindungan Dan Pemberdayaan Petani (2013). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/UU_2013_19.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 39 Tahun 2014 tentang Perkebunan (2014). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/1621.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 17 Tahun 2019 tentang Sumber Daya Air (2019). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/1751.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 22 Tahun 2019 tentang Sistem Budi Daya Pertanian Berkelanjutan (2019). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/1757.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 11 Tahun 2020 Tentang Cipta Kerja (2020). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/1771.pdf
Hadi, P. U., Simatupang, H. J., Purba, J., Situmorang, T. S., Wahyudi, W., & Nuryanti, S. (2010). Analysis of Agricultural Investment Impact towards Agricultural Sector Performance. Research Report. Bogor: Indonesian Center for Agricultural Socioeconomic and Policy Studies.
IPB University. (2020). Tinjauan Kritis IPB terhadap Undang Undang Cipta Kerja: Suatu Perspektif Agromaritim. Bogor: LPPM IPB University.
Kamil, I. (2020). Ancaman terhadap Petani dan Potensi Konflik Agraria dalam RUU Cipta Kerja. Kompas.Com, 18 February. Retrieved from https://nasional.kompas.com/read/2020/08/12/05200071/ancaman-terhadappetani-dan-potensi konflik-agraria-dalam-ruu-cipta-kerja?page=all.
Karim, A. (2020). Indonesia’s Economic Revival Behind the Lockdown of 59 Countries. International Journal of Scientific & Engineering Research Volume, 11(9), 1385–1388.
Kelleher, K., & Willmann, R. (2009). Economic Trends in Global Marine Fisheries. In Handbook of Marine Fisheries Conservation and Management. London: Oxford University Press.
Kusumawaty, Y., & Rasyid, T. H. (2018). Agricultural Management Strategy: An Islamic Perspective. In Proceedings of the International Conference on Islamic Studies (pp. 159–169). Jakarta: UM Jakarta Press. Retrieved from https://iconics2018.fai.umj.ac.id
Lipsey, R. E., & Sjöholm, F. (2011). Foreign direct investment and growth in East Asia: Lessons for Indonesia. Bulletin of Indonesian Economic Studies, 47(1), 35–63. https://doi.org/10.1080/00074918.2011.556055
Maman, U. (2021). Looking at the fate of food agricultural land below omnibus law (law of job creation). Retrieved from https://www.mamankh.com/en/menatap-nasib-lahan-pertanian-pangan-di-bawah-omnibus-law-undangundang-cipta-kerja/
Maman, U., Kusmana, & Supiandi, D. (2017). Al-Musaqoh and Sharia Agribusiness System: An Alternative Way to Meet Food Self-Sufficiency in Contemporary Indonesia. HUNAFA: Jurnal Studi Islamika, 14(2), 189–231.
Mulyani, A., Kuncoro, D., Nursyamsi, D., & Agus, F. (2016). Analisis Konversi Lahan Sawah: Penggunaan Data Spasial Resolusi Tinggi Memperlihatkan Laju Konversi yang Mengkhawatirkan. Jurnal Tanah Dan Iklim, 40(2), 121–133.
Musyaffa, I. (2020). Pengamat: RUU Omnibus Law Ciptaker berbahaya untuk pertanian. Anadolu Agency, 18 February. Retrieved from https://www.aa.com.tr/id/ekonomi/pengamat-ruu-omnibus-law-ciptaker-berbahaya-untukpertanian/1737436
Pasaribu, D., Murwani, A., & Setiawan, I. (2021). Foreign Direct Investment in Indonesia’s Agriculture. Policy Paper No. 35. Jakarta: Center for Indonesian Policy Studies.
Patunru, A., & Surianta, A. (2020). Attracting FDI Post Covid-19 by Simplifying Indonesia’s Regulatory Framework. Policy Brief No. 4. Jakarta: Center for Indonesian Policy Studies.
Rafani, I., & Sudaryanto, T. (2020a). Overview of Indonesian Agricultural Sector in Omnibus Bill on Job Creation: Challenges and Perspectives. FFTC Agricultural Policy Platform. Retrieved from https://ap.fftc.org.tw/article/2652
Rafani, I., & Sudaryanto, T. (2020b). Regulation of The Indonesian Minister of Agriculture Number 40/2019 on Business Licensing Procedures in Agriculture Sector: Simplifying, Streamlining, and Promoting Investments. FFTC Journal of Agricultural Policy, 1, 18–30.
Republika. (2014). Indonesia Miliki 14 Juta Hektare lahan Tidur. Retrieved from http://www.republika.co.id/berita/ekonomi/makro/ 16/12/14/oi6jqs368-indonesia-miliki-14-juta-hektarelahan-tidur
Rondhi, M., Pratiwi, P. A., Handini, V. T., Sunartomo, A. F., & Budiman, S. A. (2018). Agricultural land conversion, land economic value, and sustainable agriculture: A case study in East Java, Indonesia. Land, 7(4). https://doi.org/10.3390/land7040148
Ruslan, K. (2021). Food and Horticulture Crop Productivity in Indonesia. Policy Paper No. 37. Jakarta: Center for Indonesian Policy Studies.
Salasal, S. M. M. S. (1998). The Concept of Land Ownership: Islamic Perspective. Geoinformasi Bulletin, 2(2), 285 – 304. Retrieved from http://eprints.utm.my/4950/1/concept.pdf
Sihombing, B. F., & Hamid, A. (2020). Impact of the Omnibus Law/Job Creation Act in Indonesia. International Journal of Scientific Research and Management (IJSRM), 8(10), LLA-2020-266-281. https://doi.org/10.18535/ijsrm/v8i10.lla01
Sodikin. (2020). Paradigma Undang-Undang dengan Konsep Omnibus Law Berkaitan dengan Norma Hukum yang Berlaku di Indonesia. Jurnal Rechtsvinding, 9(1), 147.
Syah, A. (2021). Management of Marine and Fisheries Resources: Cipta Kerja act and Islamic Perspective. Jurnal Kajian Peradaban Islam, 4(2), 63–70. https://doi.org/10.47076/jkpis.v4i2.74
Zalloom, A. Q. (1988). Funds in the Khilafah State (2nd ed.). London: Al-Khilafah Publications.
Amanta, F. (2021). The Cost of Non-Tariff Measures on Food and Agriculture in Indonesia. Policy Paper No. 36. Jakarta: Center for Indonesian Policy Studies.
An-Nabhani, T. (2000). The Economic System of Islam (4th ed.). London: Al-Khilafah Publications.
Anggraeni, R., & Rachman, C. I. L. (2020). Omnibus Law in Indonesia: Is That the Right Strategy? In International Conference on Law, Economics and Health (ICLEH 2020) (pp. 180–182). Atlantis Press.
Asian Development Bank. (2019). Policies to support investment requirements of Indonesia’s food and agriculture development during 2020-2045. https://doi.org/10.1111/fcre.12450
Astuti, E. S. (2020). The Omnibus Law on agriculture: Why farmers are getting angry. Independent Observer, 17 March 2020. Retrieved from https://observerid.com/the-omnibus-law-on-agriculture-why-farmers-are-getting-angry/
Bengtsson, M. (2016). How to plan and perform a qualitative study using content analysis. NursingPlus Open, 2, 8–14. https://doi.org/10.1016/j.npls.2016.01.001
Black, H. C. (1990). Black’s Law Dictionary (6th ed.). St. Paul Minn: West Publishing Co.
Borhan, J. T., & Aziz, M. R. A. (2009). Agriculture And Its Contribution From The Islamic Economics Perspective. Jurnal Teknologi, 50(1), 69–86. https://doi.org/10.11113/sh.v50n1.277
Carvalho, N., Casey, J., Guillen, J., & Rodgers, P. (2020). Characterising investments in EU fisheries and defining their desirability. Fisheries Research, 221, 105396. https://doi.org/10.1016/j.fishres.2019.105396
Center for Indonesian Policy Studies. (2020). CIPS Celebrates Policy Changes Freeing up Indonesian Agriculture! Newsletter, 7 October 2020. Retrieved from https://www.cips-indonesia.org/post/newsletter-cips-celebratespolicy-changes freeing-up-indonesian-agriculture
DPR-RI. Undang-Undang Republik Indonesia Nomor 29 Tahun 2000 tentang Perlindungan Varietas Tanaman (2000). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/UU_2000_29.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 31 Tahun 2004 tentang Perikanan (2004). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/32.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 41 Tahun 2009 Tentang Perlindungan Lahan Pertanian Pangan Berkelanjutan (2009). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/UU_2009_41.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 13 Tahun 2010 tentang Hortikultura (2010). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/UU_2010_13.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 19 Tahun 2013 Tentang Perlindungan Dan Pemberdayaan Petani (2013). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/UU_2013_19.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 39 Tahun 2014 tentang Perkebunan (2014). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/1621.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 17 Tahun 2019 tentang Sumber Daya Air (2019). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/1751.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 22 Tahun 2019 tentang Sistem Budi Daya Pertanian Berkelanjutan (2019). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/1757.pdf
DPR-RI. Undang-Undang Republik Indonesia Nomor 11 Tahun 2020 Tentang Cipta Kerja (2020). Retrieved from https://www.dpr.go.id/dokjdih/document/uu/1771.pdf
Hadi, P. U., Simatupang, H. J., Purba, J., Situmorang, T. S., Wahyudi, W., & Nuryanti, S. (2010). Analysis of Agricultural Investment Impact towards Agricultural Sector Performance. Research Report. Bogor: Indonesian Center for Agricultural Socioeconomic and Policy Studies.
IPB University. (2020). Tinjauan Kritis IPB terhadap Undang Undang Cipta Kerja: Suatu Perspektif Agromaritim. Bogor: LPPM IPB University.
Kamil, I. (2020). Ancaman terhadap Petani dan Potensi Konflik Agraria dalam RUU Cipta Kerja. Kompas.Com, 18 February. Retrieved from https://nasional.kompas.com/read/2020/08/12/05200071/ancaman-terhadappetani-dan-potensi konflik-agraria-dalam-ruu-cipta-kerja?page=all.
Karim, A. (2020). Indonesia’s Economic Revival Behind the Lockdown of 59 Countries. International Journal of Scientific & Engineering Research Volume, 11(9), 1385–1388.
Kelleher, K., & Willmann, R. (2009). Economic Trends in Global Marine Fisheries. In Handbook of Marine Fisheries Conservation and Management. London: Oxford University Press.
Kusumawaty, Y., & Rasyid, T. H. (2018). Agricultural Management Strategy: An Islamic Perspective. In Proceedings of the International Conference on Islamic Studies (pp. 159–169). Jakarta: UM Jakarta Press. Retrieved from https://iconics2018.fai.umj.ac.id
Lipsey, R. E., & Sjöholm, F. (2011). Foreign direct investment and growth in East Asia: Lessons for Indonesia. Bulletin of Indonesian Economic Studies, 47(1), 35–63. https://doi.org/10.1080/00074918.2011.556055
Maman, U. (2021). Looking at the fate of food agricultural land below omnibus law (law of job creation). Retrieved from https://www.mamankh.com/en/menatap-nasib-lahan-pertanian-pangan-di-bawah-omnibus-law-undangundang-cipta-kerja/
Maman, U., Kusmana, & Supiandi, D. (2017). Al-Musaqoh and Sharia Agribusiness System: An Alternative Way to Meet Food Self-Sufficiency in Contemporary Indonesia. HUNAFA: Jurnal Studi Islamika, 14(2), 189–231.
Mulyani, A., Kuncoro, D., Nursyamsi, D., & Agus, F. (2016). Analisis Konversi Lahan Sawah: Penggunaan Data Spasial Resolusi Tinggi Memperlihatkan Laju Konversi yang Mengkhawatirkan. Jurnal Tanah Dan Iklim, 40(2), 121–133.
Musyaffa, I. (2020). Pengamat: RUU Omnibus Law Ciptaker berbahaya untuk pertanian. Anadolu Agency, 18 February. Retrieved from https://www.aa.com.tr/id/ekonomi/pengamat-ruu-omnibus-law-ciptaker-berbahaya-untukpertanian/1737436
Pasaribu, D., Murwani, A., & Setiawan, I. (2021). Foreign Direct Investment in Indonesia’s Agriculture. Policy Paper No. 35. Jakarta: Center for Indonesian Policy Studies.
Patunru, A., & Surianta, A. (2020). Attracting FDI Post Covid-19 by Simplifying Indonesia’s Regulatory Framework. Policy Brief No. 4. Jakarta: Center for Indonesian Policy Studies.
Rafani, I., & Sudaryanto, T. (2020a). Overview of Indonesian Agricultural Sector in Omnibus Bill on Job Creation: Challenges and Perspectives. FFTC Agricultural Policy Platform. Retrieved from https://ap.fftc.org.tw/article/2652
Rafani, I., & Sudaryanto, T. (2020b). Regulation of The Indonesian Minister of Agriculture Number 40/2019 on Business Licensing Procedures in Agriculture Sector: Simplifying, Streamlining, and Promoting Investments. FFTC Journal of Agricultural Policy, 1, 18–30.
Republika. (2014). Indonesia Miliki 14 Juta Hektare lahan Tidur. Retrieved from http://www.republika.co.id/berita/ekonomi/makro/ 16/12/14/oi6jqs368-indonesia-miliki-14-juta-hektarelahan-tidur
Rondhi, M., Pratiwi, P. A., Handini, V. T., Sunartomo, A. F., & Budiman, S. A. (2018). Agricultural land conversion, land economic value, and sustainable agriculture: A case study in East Java, Indonesia. Land, 7(4). https://doi.org/10.3390/land7040148
Ruslan, K. (2021). Food and Horticulture Crop Productivity in Indonesia. Policy Paper No. 37. Jakarta: Center for Indonesian Policy Studies.
Salasal, S. M. M. S. (1998). The Concept of Land Ownership: Islamic Perspective. Geoinformasi Bulletin, 2(2), 285 – 304. Retrieved from http://eprints.utm.my/4950/1/concept.pdf
Sihombing, B. F., & Hamid, A. (2020). Impact of the Omnibus Law/Job Creation Act in Indonesia. International Journal of Scientific Research and Management (IJSRM), 8(10), LLA-2020-266-281. https://doi.org/10.18535/ijsrm/v8i10.lla01
Sodikin. (2020). Paradigma Undang-Undang dengan Konsep Omnibus Law Berkaitan dengan Norma Hukum yang Berlaku di Indonesia. Jurnal Rechtsvinding, 9(1), 147.
Syah, A. (2021). Management of Marine and Fisheries Resources: Cipta Kerja act and Islamic Perspective. Jurnal Kajian Peradaban Islam, 4(2), 63–70. https://doi.org/10.47076/jkpis.v4i2.74
Zalloom, A. Q. (1988). Funds in the Khilafah State (2nd ed.). London: Al-Khilafah Publications.
Published
2022-04-01
How to Cite
Rasyid, T., & Kusumawaty, Y. (2022). Omnibus Law and the Challenges of the Indonesian Agricultural Sector: an Islamic Perspective. Jurnal Kajian Peradaban Islam, 5(1), 49-61. https://doi.org/https://doi.org/10.47076/jkpis.v5i1.119
Section
Islamic Politics, Law, and Governance
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
Copyright
- The Author and each co-authors transfer the copyright and grant the journal right of publication with the work simultaneously licensed under an International Creative Commons Attribution and ShareAlike 4.0 License that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal.
- Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal's published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgement of its initial publication in this journal.
- Authors should sign copyright transfer agreement when they have approved the final proofs sent by ISLAMIC RESEARCH prior the publication.
Author Guarantee
- The Author (Co-authors) guarantees that the Materials are an original work, submitted only to ISLAMIC RESEARCH, and have not been published previously.
- In case the Materials were written jointly with Co-authors, the Author guarantees that he/she has informed them of the terms of this Agreement and obtained their signatures or written permission to singe on their behalf.
- The Author guarantees as well that:
- The Materials do not contain libelous statements.
- The Materials do not infringe on other persons' rights (including without limitation copyrights, patent rights and the trademark right).
- The Materials do not contain facts or instructions that can cause damage or injury to third parties and their publication dose not cause the disclosure of any secret or confidential information
ISLAMIC RESEARCH is Published by Perhimpunan Intelektual Muslim Indonesia, and licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
Copyright ©2022.
