Development of Indonesian Free Trade and Port Zone: Analysis of Historical in Batam Island

Batam Island is one of the areas designated as National Strategic Areas in Indonesia. The development and direction of the Government's policy towards Batam Island underwent several policy changes in each period of government that began in 1973 to the present. Therefore, the author will examine about: What is the history of the development of Batam Island as the Free Trade and Port Zone in Indonesia? It certainly aims to find out the development and direction of the Government's policy towards Batam Island and can be used as a framework in making policies and legislation on Batam Island in the future to improve its function as a national strategic area. The study of normative juridical law with the method of approach which includes: The legal approach, the concept approach, and the historical approach. The history of the development of Batam Island as a Free Trade and Port Zone in Indonesia to date has 5 periods. These periods are: 1) The preparation period; 2) The period of infrastructure development and investment; 3) Development period for infrastructure development and investment; 4) Period of improvement of facilities and infrastructure, investment and environmental quality; and 5) The preparation period for establishing Batam as a Special Economic Zone in the Free Trade and Port Zone.

The existence of Batam Island as one of the Free Trade Areas and Free Ports needs to be strengthened by presenting historical studies related to the history of the development of Batam Island as the Free Trade and Port Zone in Indonesia. Of course, the history of the development of Batam Island cannot be separated from various legal policies from the Government from time to time. The history of law is often interpreted as a science that describes the formation of a legal system in society. If it is neglected with the development of Batam Island, the influence of the geographical location of an area and the country's destination is also one of the formations of Batam Island as the Free Trade and Port Zone in Indonesia. Therefore, to know the development and direction of the Government's policy towards Batam Island, it is necessary to learn how the history of the development of Batam Island began in 1973 to the present. Besides, with the historical study related to Batam Island, it can be used as a framework for making policies and regulations on Batam Island. Based on the above thought, the author in this study will describe and identify: How the history of the development of Batam Island as the Free Trade and Port Zone in Indonesia. Of course, studies related to the history of Batam Island as the Free Trade and Port Zone in Indonesia have not yet been undertaken in-depth studies so the theme in this Writing is the History of the Development of Batam City as a Free Trade Zone and Free Port in Indonesia

Research Methods
This research is a normative juridical legal research because it wants to study related legal products (Soekanto & Mamudji, 2004) related to land regulation and the development of Batam City as a Free Trade Zone and Free Port in Indonesia. Approach methods used in this study include: 1) The legislative approach, namely by examining the laws and regulations (Marzuki, 2007), relating to land regulations and the existence of Batam Island as a special area in Indonesia; 2)Conceptual approach, namely by studying and understanding the concepts (Ibrahim, 2007). Furthermore, techniques for analyzing legal materials are arranged systematically using the interpretation system, such as grammatical interpretation and systematic interpretation; and 3) Historical Approach, which is the approach taken in the framework of understanding the philosophy of the rule of law from time to time, and understanding the changes and developments in the philosophy that underlie the rule of law (Marzuki, 2007).

History Of The Development Of Batam Island As A Free Trade Zone And Free Port In Indonesia
Based on the Report of the Batam Business Entity Semester I of 2013, Batam Island is the second most crowded international shipping lane in the world after the Dover Strait in England so that Batam Island has become one of the strategic areas in Indonesia (Batam, 2013). Batam Island is near the Malacca Strait which is close to Singapore, Natuna Island and is in the middle of the Southeast Asian region. That position makes Batam Island has a special character. The special characters possessed by Batam Island, namely (Muliono, 2001): 1) Batam Island is the world's trade traffic because it is close to the Malacca Strait; 2) Batam Island is a world tourist destination, a world distribution node, a world financial center, and the land is limited, saturated with industry because it is close to Singapore; 3) The island is the world's largest gas oil field because it is near Natuna; and 4) Batam Island becomes the ASEAN Free-Trade Area because it is in the middle of the Southeast Asia Region. Batam Island Development began with the idea of securing the border area so that it would not become an infiltration of a foreign power. Therefore, the Government decided to develop Batam Island as the Batam development project based on offshore oil drilling logistics through the issuance of Presidential Decree Number 65 of 1970. The stages of developing Batam Island can be divided into four periods, namely (Anggraeny et al., 2014): 1) Preparation period; 2) The period of infrastructure development and investment; 3) The period of development of infrastructure development and investment; and 4) Period of improvement of facilities and infrastructure, investment and quality of confusion. Then, this period continued with the Government's idea to make Batam Island a Special Economic Zone. 1. Batam Island Preparation Period;; The Government issued Government Regulation Number 27 of 1968 concerning the Establishment of the National Oil and Gas Mining State Corporation (PN Pertamina). This was done to establish the National Oil and Gas Mining Company (Pertamina). This establishment aims to make Batam Island a logistics and operational exploitation and offshore oil exploration and exploration base, which was originally located in Singapore. This can be seen in the weighing section of the 1973,1973). Otorita Batam in carrying out its duties is responsible to the President and in carrying out his daily duties receive and heed the instructions given by the Batam Island Industrial Supervisory Board. In connection with the duties and responsibilities of the Batam Authority, the State grants the entire land area and the group of surrounding islands with Land Management Rights.
In 1974 Batam, 1974). Article 1 paragraph 1 of Government Regulation 31 of 1977 concerning Amendment to Government Regulation Number 20 of 1972 concerning Bonded Warehouse defines Bonded Warehouse as follows: "Bonded Warehouse is an institutional facility in the field of trade in the Indonesian customs area that has a certain business territory and special provisions in the field of customs, import, export, foreign exchange/goods, and investment, as a place to store, store, place, package, and package / or process goods from (Peraturan Pemerintah 31 Tahun  In 1995 (1)).
Besides, with the increase in business activities, it is necessary to expand the determination of the Free Trade Zone and Free Port which includes the Widowed Berias and its cluster. With the plan to establish Special Economic Zones in several Batam Island Regions, it is expected to be able to increase investment in special economic zones that can support national economic development and economic development in certain regions and increase employment, need to provide facilities and facilities in special economic zones as regulated Article 2 of the Government Regulation on Facilities and Facilities in Special Economic Zones (Peraturan Pemerintah Republik Indonesia Nomor 96 Tahun 2015 Tentang Fasilitas dan Kemudahan di Kawasan Ekonomi Khusus, 2015) in the form of taxation, customs, and excise, traffic of goods, employment, immigration. The Head of the BP Batam, Eddy Putra Irawadi, stated that there are two Special Economic Zones in Batam soon to be inaugurated, namely the Hang Nadim Logistics Airport Special Economic Zone (as a regional hub for e-commerce trading for products and platforms) and the Nongsa Special Economic Zone Digital Park (as a means to serve the needs of the digital economy and start-up in Batam) (Jpnn.com, 2019). However, the central government is currently completing government regulations that will become the legal umbrella for the determination of the two special areas (Jpnn.com, 2019). The establishment of this Special Economic Zone is to maximize the economic potential on Batam Island which remains a Free Trade and Port Zone with all its tax-free facilities. This was also stated by Bacharuddin Jusuf (BJ) Habibie who assessed that the Free Trade and Port Zone was still the best for Batam (Jpnn.com, 2019). www.iiste.org ISSN 2224-3240 (Paper) ISSN 2224-3259 (Online) Vol.99, 2020