Building Indonesian Law as a Tool for Social Change

We often overlook something when discussing development: we are too quick to trust programmes but too slow to ensure the law works. We design many things—from food, cooperatives, to downstreaming—but we often forget that the longevity of a policy is not determined by the size of the budget, but by its legal certainty.

Amid the ambitions of the Prabowo Subianto administration, that direction is actually starting to take shape. The free nutritious meals (MBG) programme, strengthening of Merah Putih village and sub-district cooperatives, and downstreaming of agricultural and mining products open up new economic spaces, especially in regions that have previously been more often objects than actors.

MBG, if read more deeply, is not just about providing meals and fulfilling nutrition. It creates stable demand: food ingredients, distribution, processing, and supporting services. Around it, opportunities open up for farmers, MSME actors, and small community-based businesses. It can become an initial market, even an anchor for businesses that have long lived without certainty.

The Merah Putih Cooperative is similar. It has the potential to become a local economic hub—where production is consolidated, distribution is extended, and financing is facilitated. Meanwhile, downstreaming promises something bigger: added value that has long leaked out is pulled back into the country.

But our experience is too long to be merely optimistic. Opportunities often come faster than certainty.

In the field, many small business actors enter when programmes open, but falter when directions change. They invest in equipment, labour, even debt, then face the reality that the promised market is not always stable, rules can shift, and their bargaining position remains weak.

This is where the law should take a more strategic role, not just regulating what is allowed and not, but ensuring that opportunities can truly be pursued without apprehension.

Roscoe Pound once called law a tool of social engineering. But in our practice, the law too often comes afterwards—tidying up what is already running, not preparing the way from the start. As a result, those who are most daring to seize opportunities become the most vulnerable.

If we look closer, the problem is not always the absence of rules. On the contrary, we have plenty. The licensing system has been simplified through OSS, various MSME regulations have been issued, and the investment framework continues to be improved.

Yet there lies the paradox: rules exist, but certainty is not fully felt.

Ease of doing business has indeed been opened, but not evenly. In big cities, processes can be relatively quick. In the regions, business actors still face limitations in access, literacy, and bureaucracy that is not always aligned. What appears simple on paper often remains layered in practice.

From the protection side, the problem is sharper. Large programmes will involve a large number of new actors—farmers, MSMEs, cooperatives. But their position in the economic chain remains fragile. Contracts are not always balanced, payments are not always certain, and conflicts—especially related to land and partnerships—still recur. The law is present, but its protective power has not yet sufficiently reached those who need it most.

And most worryingly is the issue of sustainability. Many of our economic policies still move in short-term logic, following political cycles, not business needs. For business actors, this is not just discomfort, but real risk. No one dares to grow if the promised market can disappear at any time.

At this point, we need to be more honest: what is lacking is not new regulations, but strengthening the direction of the law itself.

The law must begin to be read as a complete policy—legal policy—that from the start is designed to guide strategic programmes, not just follow them from behind.

At least there are three things that cannot be compromised. First, certainty of sustainability. Programmes like MBG, village cooperatives, and downstreaming must have a legal foundation that is not easily changed. Not just technical policies that can shift direction, but a framework that gives confidence to business actors to plan the future.

Second, certainty over the opportunities themselves. The law must ensure that the space opened is not only filled by those who are already strong. New business actors—especially in villages—must truly gain access: to markets, financing, and distribution networks.

Third, certainty of protection. Here the law must firmly side with them. Fair contracts, simple dispute resolution mechanisms, and protection against unfair business practices are no longer optional, but basic needs.

This view aligns with what Lawrence M. Friedman stated: law is not just about rules (substance), but also how it is implemented (structure) and perceived (culture). We may already be moving at the substance level. But without structural improvements and changes in legal culture, the impact will always be halfway.

Learning from South Korea, consistency is key. That country not only made industrial policies but guarded them in the long term. Singapore ensures that ease is real, not just administrative. Meanwhile, Malaysia and Thailand show that the state can be more present—providing access, not just rules.

Indonesia certainly has its own path. As reminded by Friedrich Karl von Savigny, law must grow from the life of its society. Village cooperatives, community-based businesses, and local economies are not new concepts. They have long been alive, just often without certainty.

Therefore, building law as a tool for social change today does not need to start from something too abstract. It must instead depart from the matter