Development's Dark Side: Infrastructure Crime and Governance Risk in Indonesia's National Strategic Projects
Keywords:
Economic Crime, Governance Risk, Infrastructure Crime, Legal Reform, National Strategic ProjectsAbstract
Indonesia created the legal category of National Strategic Projects (Proyek Strategis Nasional, PSN) to accelerate infrastructure, granting these projects simplified licensing, land acquisition, and procurement. Legal scholarship has examined these privileges mainly as questions of administrative efficiency or land rights, leaving their criminogenic effects largely unexamined. This article identifies the typology of infrastructure crime within PSN, analyzes the governance risks that produce it, and formulates legal and policy responses. Using normative juridical research with statutory, conceptual, and case approaches, it examines the PSN regulations and the regimes on procurement, land acquisition, regional government, spatial planning, environment, corruption, and money laundering, together with documented cases. It finds that PSN are exposed to project corruption, construction fraud, land grabbing, money laundering, and networked crime involving corporate and political actors, and that these crimes arise from structural governance failures: regulatory fragmentation, overlapping authority, weak ex ante oversight, over-centralization, and broad discretion justified by acceleration. It conceptualizes this pattern as development's dark side, in which the legal design that speeds projects also lowers the barriers to crime, and it proposes risk-based supervision, beneficial-ownership tracking, the follow-the-money approach, and stronger inter-agency coordination.
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