Corruption and the exploitation of natural resources remain persistent problems in Indonesia, with one of the latest cases involving alleged irregularities in mining permits that allowed operations inside forest areas in North Konawe, Southeast Sulawesi.
According to Subarudi, a Forestry Sociology researcher at the National Research and Innovation Agency (BRIN), weak governance in the management of forests, mining, and palm oil plantations has created fertile ground for corruption. The granting of natural resource permits, he said, is often turned into a source of illicit income for both government officials and business actors.
Speaking during the BRIN Webinar Update Sumatera #2 on Thursday, January 8, 2026 Subarudi explained that high political costs are a key driver behind corrupt practices in the licensing process. He also said the state has failed to effectively control the power of large conglomerates and corporations, especially in the palm oil sector, despite the existence of competition laws.
Subarudi criticized several regulations that he believes have weakened environmental protection, including the Job Creation Law (Omnibus Law). One major change, he said, was the removal of the rule requiring at least 30 percent of a single island’s land area to remain designated as a forest. He argued that this change effectively gives excessive room for investors to expand into forested areas.
He also highlighted how environmental losses caused by corruption are often not properly reflected in court rulings. This, he said, is partly due to differences in how prosecutors and judges interpret financial and economic losses to the state.
As an example, Subarudi cited the corruption case involving PT Duta Palma, which illegally occupied more than 30,000 hectares of forest land. In the initial court ruling, the company was sentenced to 15 years in prison and fined Rp43.7 trillion (US$2.6 billion). However, at the Supreme Court level, the sentence was increased to 16 years, but the fine was drastically reduced to Rp2.23 trillion.
He noted that the environmental damage was not included in the final penalty, meaning the company was only required to compensate for financial losses to the state. This situation, he warned, could ultimately benefit corrupt actors, as the true cost of environmental destruction remains unaccounted for.