KUALA LUMPUR: The government will introduce RM200 million in easy financing to help smallholders cover oil palm replanting costs for up to 40 hectares, with a four-year repayment deferment while waiting for the trees to bear fruit, said Prime Minister Datuk Seri Anwar Ibrahim.
The prime minister said smallholders will bear only two per cent interest, with the government covering the rest.
"For rubber smallholders, the government has agreed to raise the rubber production incentive (IPG) rate for the third time.
"The IPG rate will be increased to RM3.30 per kilogram, benefiting more than 300,000 smallholders,” said Anwar while tabling the 2027 Budget in the Dewan Rakyat today.
The current IPG rate is RM3.00 per kilogram. In 2022, the IPG was RM2.50 per kilogram.
As of September 2026, Anwar said 290,000 smallholders received RM400 per month in subsidy assistance, including farmers and livestock breeders as well as oil palm, rubber, cocoa, pepper, and kenaf planters.
He said the government approved RM1.26 billion in 2027 to strengthen the Federal Land Development Authority’s (FELDA) finances, road maintenance, and FELDA generation housing.
The prime minister added that 109,000 settlers now own land and that average net income rose from RM2,272 in 2023 to RM3,800 in 2026.
"The delisting of FGV Holding Bhd, however, strengthens FELDA’s finances,” he added. - Bernama
