Industrial Estates Bill Must Resolve Regulatory Overlaps, Says HKI

The Indonesian Industrial Estates Association (HKI) has stressed that the Industrial Estates Bill must harmonise 24 related regulations to resolve overlapping rules. “Why do investment barriers occur? There are at least 24 regulations related to industrial estates scattered across various ministries and agencies,” said HKI Indonesia Vice Chairman Didik Prasetiyono in Jakarta on Monday during a Public Hearing Meeting of the Industrial Estates Bill Working Committee. According to him, harmonisation is needed in the industrial estates law to accommodate the interests of industrial estates. He noted several problems occurring within industrial estates that need to be addressed, including land and spatial planning, environmental matters, infrastructure and facilities, as well as security and other issues. Didik explained that the problems faced regarding land and spatial planning are largely caused by overlapping regulations and land status. “A factory has already been built, but the land is classified as protected rice fields (LSD), for example. This complicates spatial planning and land status arrangements on the ground,” he said. Furthermore, the Spatial Utilisation Activity Conformity Approval (PKKPR) does not guarantee spatial utilisation or subsequent licensing. Even after obtaining a PKKPR, detailed land matters still need to be processed, which can take an excessively long time, up to 1.5 years. “Investors cannot wait that long. Land administration can take more than 1.5 years. An example is the exchange of village treasury land (TKD), which, if the timeline is fulfilled normatively, can take more than 1.5 years. So it is very slow in the context of hampering investment,” he added. Similarly, problems must be faced regarding the environmental approval mechanism, as not all have accommodated the characteristics of industrial estates as integrated environmental management areas. In addition, for infrastructure and facilities within industrial estates, the challenge lies outside the estate boundaries, including roads, bridges, and drainage that are beyond the industry’s capacity to facilitate. “The problem faced is the lack of a clear division of responsibility between the government and the estate manager or the local government,” he said. Didik added that security standards have not been uniformly applied across all industrial estates, with some differing from others. Coordination between the estate, local government, and security forces remains a challenge. Investment disruptions in several regions are quite high. Therefore, HKI proposes implementing an integrated industrial security system, drafting nationally applicable operational standards for industrial estate security, and strengthening inter-agency coordination in protecting industrial estates. “So there is a guarantee that investing in industrial estates is safe, roughly speaking,” he said.