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Indonesia has the world’s third largest area of tropical forest. These forests are treasured for their high biodiversity, a result of the country’s unique geographic positioning, but also as an economically important natural resource. Although the early decades of accelerated timber exploitation in Indonesia demonstrated little concern for the sustainability of forest resources, recently a shift to genuine conservationist forest policies can be observed. These new policies, however, mainly relate to the forestry sector and much less to the ongoing conflicts between the state and forest-dependent people. It is still a commonly held belief that swidden agriculturists are responsible for about half of Indonesia’s annual deforestation. In order to solve this problem the government has defined a number of measures that attempt to convert swidden agriculturists into sedentary cultivators. In this paper these measures are discussed, and they are juxtaposed against new insights about the nature of the dynamics of swidden agriculture and the role that forest management plays in this agricultural method. The official schemes propose only some sort of plantation development, which significantly reduces biodiversity in the agricultural landscape. With an example of swidden agriculture from West Kalimantan, including an important forest management component, this paper demonstrates that developing existing agriculture-forest management regimes holds the potential to bring economic development to the region, while biodiversity is conserved.