The intimate, piecemeal, land dispossession is a mundane process taking place even in the countryside; and the customary (adat) community is not an exception in this regard. The recent government policy to partially recognize adat territory poses a critical challenge whether the customary tenure system can significantly address such exclusionary process or not. This paper provides some preliminary results from on-going research in Kasepuhan Karang, Banten who just recently got the formal recognition over their customary forest from the government. Legally speaking, the state recognition covers only forest area, while non-forest area falls under jurisdiction of land administration regime and is not recognized yet by the government. The factual tenure system for agricultural land both located in the recognized forest area and in the unrecognized non-forest area is characterized by individual landholding. In this community, as in many places in rural Indonesia, indebtedness which led to distress land sales also take place especially on paddy fields outside the forest area. Following the recognition of customary forest, local version of land certificates were introduced to administer agricultural land inside the recognized customary forest. The certificates can be used as a mortgage to access credit from new cooperative established and managed by women group. While the cooperative has successfully provided financial access for small farmers to solve their problem of indebtedness, at the same time it also opens land market inside the customary forest area. This paper will examine such dynamics by discussing it in the context of on-going agrarian transition in the community.

Keywords: adat territory; fragmented recognition; rural indebtedness; exclusion; counter-exclusion.