Jakarta. Industrial expansion under President Prabowo Subianto’s first year in office has shown strong progress, with nine new industrial parks established across the country. Yet, growing reports of extortion and intimidation by local groups continue to raise concern among investors.

“The industrial sector continues to show strong progress. In the past year, we’ve added nine new industrial parks, four of which are located outside Java,” Industry Minister Agus Gumiwang Kartasasmita said in Jakarta on Monday.

The new parks include IPIP in Central Sulawesi, I-Sentra in East Java, Huadi Bantaeng Industrial Park in South Sulawesi, Cikembar II and Losarang Industrial Parks in West Java, Purwakarta Integrated Industrial Park also in West Java, Penebang Island Industrial Park in West Kalimantan, Seafer Industrial Park in Central Java, and Tembesi Industrial Park in West Kalimantan.

With these additions, the total area of industrial parks nationwide has grown by 4.81 percent, or about 4,468 hectares, bringing Indonesia’s total industrial land area to 97,345 hectares across 171 parks.

Agus said the expansion has spurred economic growth, with the number of companies operating within industrial zones rising by 1.12 percent to 11,970 firms. Industrial investment also climbed 9.26 percent to Rp 571.6 trillion ($34.6 billion), while job creation jumped 15 percent, equivalent to around 310,000 new workers in the past year.

“The development of industrial parks is part of our long-term strategy to strengthen competitiveness and expand market access for Indonesian industries,” Agus said. “Through closer international collaboration, including Indonesia’s BRICS membership and CEPA talks with Canada and Peru, we aim to accelerate our transformation into an advanced industrial economy.”

However, experts warn that the government’s industrial ambitions could be undermined by persistent thuggery and extortion targeting foreign investors. Adi Prayitno, executive director of the Indonesian Political Parameter think tank, said while the Red and White Cabinet’s first-year economic performance is “on the right track,” industrial unrest driven by local gangs remains a serious concern.

“Extortion has become one of the factors holding back industrial growth. Many businesspeople are afraid to invest or open factories because of constant demands and harassment from local groups,” Adi said at a forum in Jakarta on Monday.

Recent cases illustrate the problem. Chinese electric vehicle maker BYD has reportedly faced extortion attempts by local civic groups at its Rp 16.8 trillion electric vehicle plant under construction in Subang, West Java, a project expected to employ 18,000 workers once operational.

In another high-profile case, members of the Cilegon branch of the Indonesian Chamber of Commerce and Industry (Kadin) allegedly tried to extort China Chengda Engineering, the contractor of a Rp 15 trillion petrochemical complex in Banten. The group reportedly demanded Rp 5 trillion in “compensation.”

The government has established a thug-buster team to tackle this problem. The Anti-Thuggery Task Force was formed in May to eliminate criminal intimidation and community groups that threaten security and the investment climate. The task force coordinates across multiple ministries and agencies, including the Indonesian Military (TNI), the National Police (Polri), and the State Intelligence Agency (BIN).

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