Mining and development in Indonesia: An overview of the regulatory framework and policies

The mineral resources sector plays a vital role in the Indonesian economy. Mining contributes approximately five percent of the total Indonesian Gross Domestic Product and a much greater share within the regional economies of some resource-rich provinces. The industry has attracted many investors, including ‘newcomers’ from China, India, Russia and South Korea. Indonesian civil society (and specifically local communities) is demanding that mining companies recognise their ‘local rights’, which sometimes leads to conflict between companies and local communities.

This project provided an overview of the history of mining legislation and policies in Indonesia and an analysis of the current legislation and its impact within the mining industry. Seven key points were noted and expanded for consideration by policy makers, private enterprise and other stakeholders, to assist mining and development within Indonesia.The research illustrated that the evolution of regulatory frameworks for mining in Indonesia has been pronounced during the past century and will continue to evolve.

The report includes recommendations regarding continued collaboration with LabSosio (Department of Sociology, University of Indonesia), utilising the report information in training activities and international publications, and further research activity.