Jakarta. The Finance Ministry is currently formulating a contingency fund dedicated to the National Food Agency (Bapanas) to ensure the distribution of food in markets and execute policy interventions.

"In collaboration with Bapanas, we are currently exploring the establishment of an emergency fund model. This initiative aims to ensure that Bapanas has a predefined budget for prompt interventions within its operational framework," Isa Rachmatarwata, the Director General of Budget at the Ministry, said after a coordination meeting for securing food supply and prices ahead of Ramadan and Eid al-Fitr in Jakarta on Monday.

Isa emphasized the need for oversight to ensure the targeted use of the emergency fund, preventing any undue strain on the nation's finances.

"Our goal is to carry out this process effectively and efficiently by developing mechanisms that facilitate the provision and distribution of food while ensuring proper governance," he explained.

The Ministry also collaborates with the Financial and Development Supervisory Agency (BPKP) as auditors or verifiers for distribution activities.

Meanwhile, Bapanas disclosed that meeting the quota for importing 3.6 million tons of rice this year would require a budget exceeding Rp 30 trillion ($1.9 billion). Bapanas has been allocated a budget of Rp 442 billion for this year.

In February 2024, rice prices reportedly reached a historic peak, according to the Central Statistics Agency (BPS), just a month before the onset of Ramadan.

Compared to February 2023, the average prices of premium, medium, and lower-quality rice in mills each increased by more than 20 percent, reaching Rp 14,525 per kilogram, Rp 14,162 per kilogram, and Rp 13,664 per kilogram, respectively.

BPS reported a 0.37 percent monthly inflation in February, with year-on-year inflation at 2.75 percent and calendar-year inflation at 0.41 percent, primarily attributed to the rising food prices.

During a cabinet meeting last week, President Joko "Jokowi" Widodo urged his ministers to address the escalating food prices ahead of the March Ramadan. Jokowi has authorized Bulog to import 2 million tons of rice from Thailand to meet domestic demands. In January and February, domestic rice output was 2.8 million tons less than the national demand.