Islamic Development Bank may finance agricultural bank project in Indonesia

The Islamic Development Bank (IDB) has expressed interest in financing the establishment of an agricultural bank in Indonesia, Indonesian Agriculture Minister Soleh Solahudin was quoted by the news agency ANTARA as saying.

"The concept of the agricultural bank is still be discussed with the relevant agencies, such as Bank Indonesia (the central bank), the Finance Ministry, and business people engaged in the agribusiness sector," he told the press after a coordination meeting on economy, finance and industry in Jakarta on Tuesday.

The bank could be set up early next year, after consultation with relevant agencies, he said.

The agriculture ministry has decided to establish an agricultural bank in view of the low investment in the agribusiness sector, he said, adding that, "Investment in the agricultural sector is less than 10 percent, and foreign investment even reaches 3.5 percent, apparently as the result of inadequate support from the existing financial institutions."