A group of Saudi Arabian businessmen is close to signing a deal to invest millions of dollars in cultivating rice in an isolated region of Indonesia, said a government source. The 15 investors are reported to be planning to spend up to $65 million on the venture to develop up to 150,000 hectares of paddy fields in the Merauke area of Papua. The cost of rice has soared on world commodity markets this year. An official from the Saudi Agriculture ministry would not say when work on the project might begin but confirmed negotiations were in the latter stages. The deal coincides with Indonesia's plan to develop the remote are in a bid to make the country one of the world's major rice exporters by the end of next year. The proposal is all the more ambitious given that Indonesia until recently was a major importer of the commodity. The government has set aside more than 1.5 million hectares of land on the island for rice cultivation and hopes to export up to six million tons next year. The program is designed to make the Merauke regency in Papua province an integrated rice production complex for the eastern areas of the archipelago. The ministry earlier said the investment would also be channeled for the construction of 700 kilometers of roads in the regency, 1,500 kilometers of connecting road to West Papua province, three ports and irrigation systems. The Central Statistic Agency says total harvest area last year in Papua was 20,788 hectares, up from 19,898 hectares a year earlier. The total harvest area in Indonesia was 12.16 million hectares, mostly located outside Java. The ministry said the investors chose Indonesia for the agribusiness venture due to its decent water provision and supporting climate.
