Indonesia Restores Aceh's 2026 Disaster Recovery Budget Following Presidential Approval

Presidential Approval Secures Aceh's Recovery Funds

Indonesia's Finance Minister Purbaya Yudhi Sadewa announced that President Prabowo Subianto has approved the restoration of 2026 budget transfers to Aceh province. This crucial decision reverses previously planned cuts and is set to inject approximately 1.7 trillion rupiah (around US$101 million) into Aceh's coffers to accelerate post-disaster recovery efforts. The announcement was made following a coordination meeting in Banda Aceh on January 10, 2026.

The move comes after severe floods and landslides impacted Aceh, along with North Sumatra and West Sumatra, in late November 2025. The restoration of funds underscores the government's commitment to supporting regions grappling with the aftermath of natural calamities.

Background to the Budget Restoration

The decision to restore Aceh's budget transfers for 2026 followed a direct appeal from Aceh Deputy Governor Fadhlullah, who sought discretion from the Finance Minister to ease efficiency measures on regional transfers. House of Representatives (DPR) Deputy Speaker Sufmi Dasco Ahmad played a pivotal role by facilitating a phone call between Minister Purbaya and President Prabowo, during which the President approved the proposal to return Aceh's transfers to previous levels.

Previously, the government had considered significant cuts to regional transfers for 2026, with some proposals suggesting a 25 percent reduction. The President's intervention ensures that Aceh will receive the necessary financial support to rebuild and recover.

Broader Disaster Recovery Efforts in Sumatra

The restoration of Aceh's budget is part of a larger, comprehensive approach by the Indonesian government to address the widespread disaster impacts across Sumatra. President Prabowo Subianto has emphasized a 'serious, comprehensive, and measurable' strategy for recovery.

Key aspects of the broader recovery efforts include:

• Formation of a Task Force for the Acceleration of Post-Disaster Rehabilitation and Reconstruction in Sumatra, led by Minister of Home Affairs Tito Karnavian. This task force is responsible for infrastructure recovery, education, governance, road construction, housing, and healthcare facilities.
• An estimated Rp 60 trillion has been allocated for the overall Sumatra rehabilitation and reconstruction efforts, covering Aceh, North Sumatra, and West Sumatra.
• The Finance Ministry had already disbursed IDR 1.279 trillion (approximately US$75.94 million) to the Aceh Provincial Administration as of early January to aid immediate disaster management.
• President Prabowo spent New Year's Eve 2026 with flood victims in Aceh, signaling high-level attention to the recovery process.

Impact on Aceh's Recovery

Deputy Governor Fadhlullah expressed gratitude for the President's decision, stating that restoring the transfers would significantly help speed up Aceh's post-disaster recovery. The funds are crucial for rebuilding damaged infrastructure, supporting affected communities, and restoring livelihoods across the province.