September 10, 2025 | 04:05 pm
TEMPO.CO, Jakarta - A new burden sharing scheme, jointly agreed upon by Bank Indonesia (BI) and the Finance Ministry to finance the government's Asta Cita program, has drawn criticism from economists. Critics argue the policy risks accelerating inflation and compromising the central bank's independence.
According to Bhima Yudhistira, Executive Director of the Center of Economic and Law Studies (Celios), the initiative carries at least three major negative consequences: a surge in inflation, a threat to BI's independence, and the potential for the government to become dependent on continuous borrowing from the central bank.
The burden sharing plan was first revealed by BI Governor Perry Warjiyo during a meeting with the Regional Representative Council (DPD RI) on Tuesday, September 2, 2025. The scheme involves BI purchasing government bonds (SBN) from the secondary market. Under the agreement, BI will assume a portion of the interest payments on these bonds, easing the fiscal burden on the government.
The funds generated from the bond purchases are earmarked to finance two of President Prabowo Subianto's priority programs: People's Housing and Red and White Village/Community Cooperatives.
The Three Negative Impacts
According to Bhima, the primary risk is inflation. He argues that to acquire the SBNs, BI must effectively print money, a measure that could exacerbate existing inflationary pressures. These pressures are already rising due to soaring prices and scarcity of essential commodities, such as rice and fuel, in the domestic market.
"There's not much fuel being sold. This means there will be inflation triggers in the coming months. Adding burden sharing will make it worse. But the government denies everything," Bhima told Tempo on Wednesday, September 10, 2025.
The second concern is the jeopardization of Bank Indonesia's independence. A central bank's core mandate is to maintain monetary stability. Celios argues that this essential function is being compromised to serve the government's fiscal agenda.
The third major risk, Bhima stated, is the potential for government dependency on continuous central bank borrowing. This risk arises because BI acts as a "standby buyer," making it too easy for the government to rely on this financing mechanism rather than seeking more sustainable sources of revenue.
Government's Justification and Rebuttal
BI Governor Perry Warjiyo has defended the policy, explaining that the central bank's continued support is intended to ease the financial burden of programs aimed at the grassroots economy.
Recently, BI purchased Rp200 trillion in SBNs from the secondary market, with a portion of the funds allocated to these programs. The burden-sharing mechanism dictates that each party bears half of the interest burden. For example, the effective interest rate for each party is 2.9% for housing and 2.15% for village cooperatives.
Meanwhile, Finance Minister Purbaya Yudhi Sadewa, who recently took office replacing Sri Mulyani, stated that he has not yet had a detailed discussion on the policy but is confident it will not lead to inflation.
He argues that inflation would only occur with rapid economic growth. "Inflation is rapid growth, if the economy grows rapidly," he said at the Presidential Palace on Tuesday, September 9, 2025, as quoted from the Presidential Secretariat's YouTube channel.
Editor’s Choice: Bank Indonesia Resumes Burden Sharing Scheme, Buys Rp200tn in Bonds
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