The Indonesian Forum for Environment (WALHI), the Nusantara Indigenous Peoples Alliance (AMAN), and the Agrarian Renewal Consortium (KPA) have launched a financing initiative, Dana Nusantara or the Nusantara Fund. This is said to be the first fund to directly provide grants to indigenous peoples and local communities.

This initiative is part of the commitments under the Indigenous Peoples and Local Communities (IPLC) Forest Tenure Pledge or the Agreement on Forest Ownership at the Conference of the Parties (COP) 26 Glasgow, Scotland, in 2021.

At the conference, donor institutions pledged their commitment to boost their direct support for IPLC to reach $1.7 billion (Rp25.28 trillion) for 2021-2025, as part of efforts to restore forests and degraded land.

In Indonesia, Dana Nusantara was launched with an initial $3 million from international philanthropic institutions including the Ford Foundation and Packard Foundation. 

Ford Foundation President Darren Walker said that Dana Nusantara is joining hands with select organizations in countries with tropical forests to meet the IPLC Forest Tenure Pledge targets. In the next five years, financing is expected to reach $20 million.

He said that Dana Nusantara will directly be used to strengthen the capacity of IPLC in managing the environment. This will include curbing emissions, building local economies, and managing resources that are critical for the Indonesian people, and the global climate. 

The fund is expected to contribute to the attainment of the Nationally Determined Contribution (NDC) and Indonesia’s zero emissions target.

Indigenous peoples and local communities are at the forefront of nature conservation efforts, but they have not received the necessary funding. 

So far, forests are being logged out, the environment destroyed, and people robbed of their rights in the name of economic growth. At present, we want to encourage economic growth by people at the grassroots level simultaneously with efforts to restore the environment. We also want to get recognition of the rights of local communities and indigenous peoples.

Zenzi Suhadi, Executive Director, The Indonesian Forum for Environment (WALHI)

A report by the Rainforest Foundation, for example, showed that from the $2.7 billion in global funding for climate change, only $270 million or just one percent was for customary societies and local communities and that from this amount, only $47 million was directly channeled to the intended beneficiaries c across the world.

“I hope that donors and financiers where ever they are, can join us and commit to improving the livelihood of customary societies and local communities as well as the conservation of their living areas,” Walker said during the launch of Dana Nusantara at Hotel Indonesia Kempinski in Jakarta on May 8, 2023.

Dana Nusantara aims to be able to achieve the mapping of indigenous territories, areas managed by local communities, the location of agrarian reform priorities that cover 20 million hectares, land registration, the territories of IPLC that cover 7.8 million hectares, and the rehabilitation and restoration of 3.5 million hectares of land belonging to IPLC.

It also wants to help create various production, distribution, and consumption models that are fair and sustainable, as well as centers of education for the people. 

These targets are expected to have a direct impact on at least 30 million people or 11 percent of the Indonesian population. They will affect 30 million hectares of forests and land or one-sixth of Indonesia’s land surface.

“So far, forests are being logged out, the environment destroyed, and people robbed of their rights in the name of economic growth. At present, we want to encourage economic growth by people at the grassroots level simultaneously with efforts to restore the environment. We also want to get recognition of the rights of local communities and indigenous peoples,” said WALHI Executive Director Zenzi Suhadi.

He said that Dana Nusantara was a form of support for customary societies and local communities which have so far taken part in building the economy, restoring the environment, safeguarding forests, and contributing to climate change mitigation.

Wider participation of customary societies and local communities in safeguarding nature and its food sources is believed to have a positive impact on people in Indonesia and the rest of the world.

“The clean air we breathe, the food we enjoy are there because indigenous peoples and local communities safeguard the earth and produce food for us,” Suhadi said.

KPA Secretary General Dewi Kartika believes that Dana Nusantara can strengthen and expand the social capital of unions of farmers, fishermen, and indigenous peoples.

Kartika hopes that this funding mechanism can be ideal for strengthening education, building schools, and building transformative economic, production, and consumption models, which in the past, tend to be forced on IPLC.

“It is hoped that Dana Nusantara can support farmers’ organizations at the grassroots level, indigenous communities, fisherman unions, and empower women in villages to aim big, not only dream,” she said.

Dewi believes that this funding initiative will provide momentum for working together to strengthen the shared vision: to save agrarian and other natural resources, grassroots movements should be at the center of Dana Nusantara’s support.

The principle of flexibility

Dana Nusantara has appointed AMAN, Walhi, and KPA leaders as members of the council. The funding mechanism will focus on community-based principles, accountability, equality, flexibility, inclusivity, and transparency as well as respect for human rights.

In line with these principles, proposal submissions or reporting will be made simple.

Rukka Sombolinggi, Secretary General of AMAN, said that the programs that will receive funding support will be tailored to village priorities. The application submission mechanism will be determined by the three organizations. Approved programs will then be sent to Dana Nusantara for funding.

“Communities don’t have to develop a (detailed) proposal, as any funding opportunity normally requires. They only need to know (their priority program), and prepare simple notes that can also be in video format. Reporting can also be done through photos or videos. Technically, we want simplicity. What is critical is evidence,” Sombolinggi said.

By December 2022, the funding mechanism had been tested on 30 communities, customary societies, and local communities in Indonesia. 

It is hoped that Dana Nusantara can support farmers’ organizations at the grassroots level, indigenous communities, fisherman unions, and empower women in villages to aim big, not only dream.

Dewi Kartika, Secretary General, Agrarian Renewal Consortium (KPA)

At the grassroots level, the funding is being used for a number of activities such as the restoration of indigenous forests, local animal husbandry businesses, development of market access, coffee production business, honey business, and the development of a farming system that is in line with nature and minimizes chemicals.

“It wouldn’t be our decision, but theirs (IPLC). Because they know better (what’s most important to them). What we need to do is respond swiftly,” Sombolinggi  added.

She said that the purpose of the trial was not only to see the impacts on the field. It was also to test the assumption that funding actually reached the target and is used in line with the priorities.

She expects that Dana Nusantara can become a platform to consolidate the efforts of UPLC in Indonesia and become an inspiration when it comes to social and environmental funding with simple schemes.