Strategic criteria refers to the benefits of the project for the economy, social welfare, defense, national security, as well as connectivity and distribution diversity between islands.
Meanwhile, the operational criteria that must be met is a pre-feasibility study and having an investment value must be above Rp 100 billion, or the project has a strategic role in encouraging regional economic growth.
On the other hand, the National Strategic Project has also received various criticisms, such as negative cash flows experienced by state-owned enterprises (BUMN) due to assignments by the government and environmental issues.
Apart from that, PSN also faces obstacles in terms of land acquisition, planning and preparation, funding, licensing and construction implementation.
[2] According to Bappenas, to improve Indonesia's lagging infrastructure capacity, the country needs large amounts of investment in this sector, namely Rp4,796.2 trillion during the 2015-2019 period.
The need for investment funds is projected to increase again to Rp 6,445 trillion for the 2019-2024 period, with the largest contribution expected to come from the private sector, namely 42%, followed by the APBN at 37%, and BUMN by 21%.
In the 2015-2019 National Medium Term Development Plan (RPJMN), one of the main problems and challenges facing the Indonesian economy is the limited availability of infrastructure to support increased economic progress.
[citation needed] The designation of National Strategic Projects can be altered based on studies conducted by the Committee for the Acceleration of Priority Infrastructure Provision (KPPIP).
[citation needed] However, this regulation received criticisms, since if there are deviations or abuse of authority in the implementation of National Strategic Projects, resolution is carried out by prioritizing government administration processes.
and if there is a criminal act that is not administrative in nature, the head of the ministry/institution, governor, or regent/mayor submits it to the Attorney General's Office or the Indonesian National Police no later than five working days for legal regulations to be followed up.
Unika Atmajaya Chancellor Agustinus Prasetyantoko assessed that the crowding out effect could occur due to massive infrastructure development, although it has not yet led to over-investment.
The cash flow of state-owned enterprises (BUMN) assigned to build infrastructure is said by Agus Pambagio, a public policy observer, to be yellow and some to be red.
[21] Vice President Jusuf Kalla has been recorded criticizing several National Strategic Projects, such as the Jabodebek LRT, Trans Sulawesi Railway and Kertajati Airport, West Java.
Jusuf Kalla assessed that the construction of the Jabodebek elevated LRT (the building structure above) caused expensive costs and meant that the toll road could not be widened any further.
[26] Chairman of the Construction and Infrastructure Division of the Indonesian Chamber of Commerce and Industry, Erwin Aksa, assessed that the large number of construction accidents was caused by assignments to build new infrastructure projects to too many State-Owned Enterprises (BUMN) without taking into account their capabilities, thus causing the level of accuracy and prudential management to become fragmented.
[31] In Bekasi, the Vice Governor of West Java, Uu Ruzhanul Ulum, assessed that the floods that hit Bekasi City in February 2020 occurred due to rising river levels, the construction of the Bekasi–Cawang–Kampung Melayu Toll Road project, the construction of the Light Rail Transit, and the Jakarta–Bandung highspeed rail line project.
[32] To address funding, the government has formed PT Sarana Multi Infrastruktur and increased its capital capacity by Rp.
22 trillion,[33] then PT Indonesia Infrastructure Finance which was founded on January 15, 2010, PT Penjaminan Infrastruktur Indonesia which was formed on May 11, 2010 and the scope of its guarantee was expanded to State-Owned Enterprises, including BUMN which received assignments from government, availability payment services, namely the PJPK's periodic payment facilities to business entities for the availability of infrastructure services, as well as the State Asset Management Institute whose task is to ensure timely availability of land for the development of National Strategic Projects.
The background is that the investment burden in the form of expensive construction has not been able to be fully recovered by infrastructure service rates due to people's purchasing power.
Apart from that, the Umbulan Drinking Water Supply System, The Palapa Ring National Strategic Project also uses an availability payment scheme.
[38] The people of Nagari Kasang, Batang Anai District, Padang Pariaman Regency, demonstrated to demand adequate land compensation for the Padang–Pekanbaru Toll Road project.
[39] Apart from that, residents asked for uninterrupted access between villages, so PT Hutama Karya as the contractor plans to build an underground crossing as a solution.
[42] A different thing happened to the residents of South Tapanuli who actually supported the construction of the Batang Toru hydroelectric power plant with a capacity of 510 MW.
The tribal chief must be persuaded, there is a ceremony to release customary rights, and compensation changes must also be transparent, involving the local government.