This study analyzes the Indonesian Village Fund (VF) Program by mapping each VF-related activity to all 17 SDGs (Sustainable Development Goals), and then determines an SDG-based VF allocation in 2018, 2019, and 2020. This study used data from all villages in Indonesia and is the most comprehensive study in Indonesia to address the knowledge gap between VF allocation and SDGs by analyzing the distribution of the use of the VF. The objectives of this paper are: (1) to provide the extent of VF usage to provide evidence on whether this utilization was aligned with the targeted SDGs, and (2) to provide information regarding village activities funded by the VF that were linked to each SDG. The results from this analysis can be used to encourage the Government to socialize and provide an understanding of SDGs to village leaders. Moreover, since Indonesia has developed Village SDGs, which are based on national SDG targets and localization of global SDGs to adapt to local culture as well as social and environmental conditions, it is recommended that other developing countries could formulate similar strategies to help achieve their national SDG targets and to develop rural areas in a more targeted way by prioritizing the most relevant issues. The study shares lessons learned from Indonesian experience in managing fiscal policy to more than 70,000 autonomous villages through the village fund program in the last five years.

Using an exclusive data set from Indonesia in 2018–2020, this study aims to prove whether there is a relationship between the allocation of village funds and the level of hunger in the community. In particular, this study tries to find out whether the Village Fund allocation policy has an effect on the achievement of the United Nations Sustainable Development Goal 2 (SDG#2). Using a quantitative method with regression analysis, this study found that the allocation of village funds by the Indonesian government supported hunger and poverty alleviation in all areas of Indonesia’s villages. This research result has implications for policymaking on sustainable food inclusion, especially in Indonesian villages.