Indonesia Gains 127 Hectares of Palm Oil Plantations from Border Agreement with Malaysia

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Illustration of Palm oil plantation. Photo by: Sawit Fest 2021 / Tiara Nur Fadilah

PALMOILMAGAZINE, JAKARTA – Hadi Tjahjanto, the Coordinator Minister for Politics, Legal, and Security, announced that Indonesia would receive 127 hectares of palm oil plantations from Malaysia as part of a border agreement on Sebatik Island.

He made this announcement during a coordination meeting with the National Border Management Agency (BNPP) in Kebayoran Baru, South Jakarta, on Thursday (6/6/2024).

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“The border issue on Sebatik Island between Indonesia and Malaysia has been resolved. The Outstanding Boundary Problem (OBP) has been resolved,” Hadi stated.

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Sebatik Island is home to a village that is split by the border between the two countries. Under the agreement, Malaysia will cultivate one half of the village while Indonesia will receive compensation in the form of 127 hectares of palm oil plantations from Malaysia. “Approximately 127 hectares of palm oil plantations will be transferred to Indonesia,” he added.

However, this compensation comes with terms and conditions. Malaysia is requesting approximately Rp 50 billion in compensation to facilitate housing relocation due to the impacts of the border agreement.

“Obtaining 127 hectares of palm oil plantations is a significant development. The local government should maximize the benefits as it will generate income from the plantations,” Hadi emphasized. He also stressed the importance of resolving the compensation issue and urged the Ministry of Agrarian Affairs and Spatial/National Land Agency to address it promptly.

The former commander of Indonesian Army also mentioned that in geographic, Indonesia is in land border with three countries, and ten countries in sea border. Besides, Indonesia has 111 outermost small islands. That is why he continued, there would be complex issue to manage the borders both in security defence, sovereignty and people’s welfare.

“It is hoped BNPP should formulate and get strategic policies to develop the borders. This would be a noble task and need good supports and collaboration among regents, mayor in the border areas, and other stakeholders,” Hadi said, as in the official statement to, Thursday (6/6/2024).

He also hoped, the coordination meeting should formulate the leads of future policies and strategies as the 2025 – 2029 Development Plans both in medium term development plans or master plan for national border management and border areas comprehensively. (T2)

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