The Farmer Entrepreneur Program (INTAN) under the People’s Income Initiative (IPR) is a comprehensive approach taken by the Ministry of Economy to address food safety and security issues using modern agricultural methods, while also eradicating poverty for the sustainability of the nation’s future.
As announced last month, the government has decided to expedite the implementation of the IPR-INTAN Program with the aim of enhancing the effectiveness of poverty eradication efforts and increasing the people’s income.
This initiative will also improve the sustainability of food supply and help regulate food prices in the market. A new model for implementing the IPR-INTAN Program will be introduced by inviting private companies with skills and capabilities to become strategic partners (through a Request for Proposal – RFP).
They will collaborate with the government and the public (including the B40, poor, and hardcore poor segments) to collectively undertake agricultural production projects across the country.
The agricultural projects may involve crops or livestock that yield results in less than 2 years and have the potential for modern farming technologies.
The government has allocated RM100 million for the year 2023 to carry out the IPR-INTAN projects through the RFP process with selected private companies. Seven Corridor Development Authorities (CDA) and State Economic Development Corporations (SEDC) are responsible for issuing invitations (RFP), selecting, appointing, and monitoring these IPR-INTAN projects based on agreements between the parties involved.
The allocation of IPR-INTAN funds through RFP to CDAs and SEDCs is as follows:
The selection of private companies to implement the IPR-INTAN projects through RFP will be based on several criteria, primarily experience in agricultural projects, a good reputation in the industry, sound management structure, and strong financial capability. Interested private companies are required to submit project proposals that include at least three main components:
1/ Project proposals including scope, implementation methods, production estimates, participant income projections, harvesting cycles, average farm prices (ex-farm price), and marketing of products.
2/ Proposals for infrastructure preparation costs, participant training, and related information.
3/ Long-term plans for participants and projects, such as the duration of participant placement at the project site, participant exchange mechanisms, participant/project expansion plans (scale-up), and exit clauses.
Implementation of the IPR-INTAN projects through RFP can be carried out on government-owned land (Federal Government/State Government/Federal Statutory Bodies/State Statutory Bodies) or private land.
For projects on government-owned land, the government will fully fund the implementation costs of the project, including the operating costs for the first planting/livestock cycle.
For projects on private land, the government will provide funding through a matching grant mechanism at a 50:50 ratio (Government:Company) based on the eligible expenditure. The financing limit is RM5 million per application (estimated area of 40 acres) and not exceeding RM25 million per company.
Reimbursement claims are made after the company completes the entire project. Financing scope includes basic project infrastructure, agricultural project infrastructure, and first-season operating costs.
For government-owned land, the minimum land use authorisation period is 5 years, while for private-owned land, the minimum land use authorisation period is 10 years, with provisions for automatic lease renewal.
The land must also be in suitable condition to avoid substantial project costs being used for land improvement. Selected private companies will be responsible for training selected participants in technical aspects, entrepreneurship, project management, financial management, and motivation.
Each participant will be provided with a job contract to ensure the rights of all parties are clear and protected. The contract will also cover matters related to excess profit-sharing if the agricultural product selling prices exceed the original estimates.
Each participant will be guaranteed a minimum income of at least RM2,000 per month. The ECERDC and NCIA are scheduled to release the RFP documents for private companies for several project locations in mid-September 2023, and the appointment of selected companies can be made before November 2023. Further information regarding RFP for interested individuals, CDAs, and other SEDCs will be announced in the near future.
