Indonesia blindsided by ruling against Nusantara’s 190-year land right law – South China Morning Post

Report on Constitutional Court Ruling on Nusantara Land Rights and its Implications for Sustainable Development Goals (SDGs)

1.0 Introduction and Project Context

A recent ruling by Indonesia’s Constitutional Court has introduced significant legal and investment challenges to the development of Nusantara, the nation’s proposed new capital in East Kalimantan. The US$28 billion project, envisioned as a smart and green city, is central to national development strategy but now faces renewed scrutiny. The court’s decision directly impacts the legal framework designed to attract investment, creating a complex interplay between economic objectives and constitutional principles aligned with the Sustainable Development Goals (SDGs).

2.0 The Constitutional Court’s Decision

The court nullified a 2024 government decree that provided special land tenure privileges for investors in Nusantara. The ruling establishes the following:

• Invalidation of Extended Rights: The decree granting land cultivation rights up to 190 years and building/usage rights up to 160 years was declared unconstitutional.
• Reinstatement of National Regulations: Nusantara must now adhere to existing national laws, which limit land rights to a maximum of 95 years for cultivation and 80 years for building and usage.
• Constitutional Precedence: The court affirmed that special regulations designed to attract investment must not conflict with the fundamental principles of equality and justice enshrined in the constitution. The petition was initiated by representatives of the indigenous Dayak community and a local resident, highlighting disparities in land rights allocation.

3.0 Analysis of Implications for Sustainable Development Goals (SDGs)

The court’s decision has profound implications for Indonesia’s commitment to the 2030 Agenda for Sustainable Development, affecting several key goals.

1. SDG 16 (Peace, Justice and Strong Institutions) & SDG 10 (Reduced Inequalities)

   The ruling is a significant affirmation of SDG 16 by demonstrating the strength and independence of Indonesia’s judicial institutions. By upholding the constitution over special economic incentives, the court reinforces the rule of law. Furthermore, the decision directly advances SDG 10 by striking down a regulation that created legal and economic inequality between large-scale investors and local/indigenous communities. It ensures that land rights are governed by a single, equitable national standard, protecting the rights of marginalized groups.

2. SDG 11 (Sustainable Cities and Communities) & SDG 15 (Life on Land)

   The long-term success of Nusantara as a “green city” under SDG 11 depends on inclusive and sustainable planning. The court’s decision supports this by ensuring that development does not proceed on a basis of legal exceptionalism that could sideline indigenous communities. Protecting the land rights of the Dayak people is crucial for creating a truly sustainable and inclusive urban community. This aligns with SDG 15, as indigenous communities are often key stewards of local ecosystems, and securing their land tenure is vital for the protection of biodiversity in East Kalimantan.

3. SDG 8 (Decent Work and Economic Growth)

   While promoting justice and sustainability, the ruling presents a potential impediment to achieving SDG 8. The extended land tenures were a primary mechanism to de-risk the project and attract the substantial private investment needed for economic growth and job creation. The reversion to shorter, standard tenures may be perceived by developers as a deterrent, potentially slowing the project’s progress and its anticipated economic benefits. This highlights a critical tension between fostering a favorable investment climate and upholding legal and social sustainability frameworks.

4.0 Conclusion

The Constitutional Court’s ruling places the Nusantara project at a critical juncture. It mandates that the development must proceed in alignment with Indonesia’s constitutional principles of equality and justice. Moving forward, the government faces the challenge of balancing the need to attract investment for economic growth (SDG 8) with its commitment to building strong institutions (SDG 16), reducing inequalities (SDG 10), and ensuring the development of a truly sustainable and inclusive city (SDG 11).

Analysis of Sustainable Development Goals in the Article

1. Which SDGs are addressed or connected to the issues highlighted in the article?

• SDG 10: Reduced Inequalities

  The article highlights the disparity in land rights granted to investors versus those available to local residents and indigenous communities. The legal challenge was brought by a representative of the Dayak indigenous community and another resident who were granted significantly shorter land use rights, pointing to an issue of inequality in law and policy.

• SDG 11: Sustainable Cities and Communities

  The entire context of the article is the development of Nusantara, a new “smart, green city.” The conflict over land rights is a critical challenge to achieving inclusive and sustainable urbanization, as it involves balancing economic development with the rights and well-being of existing communities.

• SDG 16: Peace, Justice and Strong Institutions

  This goal is central to the article. The decision by Indonesia’s Constitutional Court to strike down a government regulation demonstrates the functioning of a strong, independent judicial institution. The case itself, initiated by citizens to challenge a law they deemed unconstitutional, is a direct example of access to justice and the promotion of the rule of law.

2. What specific targets under those SDGs can be identified based on the article’s content?

1. Target 10.3: Ensure equal opportunity and reduce inequalities of outcome, including by eliminating discriminatory laws, policies and practices and promoting appropriate legislation, policies and action in this regard.

   The Constitutional Court’s ruling directly addresses this target by nullifying a “special regulation” for Nusantara that created different and preferential land rights for investors compared to national standards and the rights of local residents. The court’s action is a clear step toward eliminating a discriminatory policy.

2. Target 11.3: By 2030, enhance inclusive and sustainable urbanization and capacity for participatory, integrated and sustainable human settlement planning and management in all countries.

   The development of Nusantara is a major urban planning project. The legal challenge from the Dayak indigenous community highlights a failure in “inclusive” and “participatory” planning. The conflict shows that the initial development framework did not adequately consider the rights and inclusion of local communities, a key aspect of this target.

3. Target 16.3: Promote the rule of law at the national and international levels and ensure equal access to justice for all.

   The article details how representatives of an indigenous community and a local resident successfully used the legal system to challenge a government decree. Their petition to the Constitutional Court and the subsequent ruling in their favor exemplify the principle of equal access to justice and the upholding of the rule of law over special-interest regulations.

4. Target 16.6: Develop effective, accountable and transparent institutions at all levels.

   The Constitutional Court is presented as an effective and accountable institution. It reviewed a government regulation, found it to be in conflict with the constitution, and struck it down, thereby holding the executive/legislative branches accountable to the country’s foundational legal principles.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

• Implied Indicator for Target 10.3: The existence and subsequent nullification of a discriminatory law. The article describes a specific regulation granting investors land rights of up to 190 years while national law limits them to 95 years and a local resident was granted only 10 years. The court’s decision to strike down this “special regulation” serves as a direct, qualitative indicator of progress in eliminating discriminatory laws.
• Implied Indicator for Target 16.3: The successful use of a formal dispute resolution mechanism by citizens. The petition filed by Stepanus Febyan Babaro and Ronggo Warsito to the Constitutional Court is a clear instance of citizens accessing a formal justice system to resolve a dispute with the government. The court’s ruling in their favor is an indicator of the effectiveness of this access. This relates to official indicator 16.3.3 (Proportion of the population who have experienced a dispute… and who accessed a formal… dispute resolution mechanism).

SDGs, Targets, and Indicators Table

Source: amp.scmp.com