The accord to do development and to develop Batam Island area is supported by decision of the Government. Several studies have been carried out and the result are been made inputs in the forming of an operational basis and complete with its implementation instruments.

Therefore in 1970, based on presidential Decree No. 6 dated October 19, 1970 Batam Island was developed with at the first stage was limited to projects that have relation with Pertamina activities, namely, as Logistic and Operational basis for business related to oil and natural gas exploration and     exploitation.
The first master plan has been prepared by pertamina together with pacific Bechtel and Nissho Iwai. Revision toward the said master plan has been carried out in 1974 by Crux.

Future, in 1979 revision has been carried out as well by Batam Authority together with Directorate General of Building Construction (Cipta Karya) of the Department of Public Works.

This revision resulted in a space lay out basis of Skeleton plan (RKDTR) 1979, then the Institute of University of Technology of Indonesia carried out evaluation and revision in 1986 and the last in 1991, Batam Authority together with Institute of University of Technology of Indonesia has conducted the re-evaluation with the objective to increase development volume, speed, and quality securing the achievement of objective and target of the development stipulated.

The presidential Decree No.41 of 1973 dated November 22, 1973 stipulated Batam Island to be built and developed in to four main function, there are :

       1. Industrial Area;
       2. Central Transshipment point for Indonesia;
       3. International Trade Center;
       4. Tourism Region;

As executor of the building and development task above mentioned, Batam Authority has been appointed, which in its implementation the chairman of Batam Authority is directly responsible to the president of the Republic of Indonesia.

Administration
In 1973, Batam Island had the status of a village and within the scope of Pulau Belakang Padang District, Riau Island Regency.
By Government Regulation No.34 of 1984, the status of Batam Island was raised becoming Batam Administrative Municipality of which its area covered 186 island and became three (3) District consisting of one (1) village, eighteen (18) sub-village, specified as follows :

    West Batam District, consisting of four villages :
    1. Batam
    2. Pulau Buluh
    3. Sekupang
    4. Tiban

    East Batam District, consisting of 10 villages :
    1.   Nongsa
    2.   Sungai Beduk
    3.   Kabil
    4.   Temoyong
    5.   Ngenang
    6.   Lubuk Baja Kota
    7.   Lubuk Baja Timur
    8.   Lubuk Baja Barat
    9.   Lubuk Baja Utara
    10. Lubuk Baja Selatan

    Belakang Padang District, consisting of one village and four sub-villages :
    1.  Belakang Padang Villages
    2.  Kasu sub-village
    3.  Lemping
    4.  Pecung
    5.  Pulau Terung

Soon after the establishment of Batam Island Administrative Municipality, the Government issued Presidential Decree No.7 of 1984, regulating division of tasks and work relation between Batam Industrial Development Authority with Batam Administrative Municipality, with the principle core that Batam Authority is responsible for the implementation of Batam Island building and development as outline and stipulated by the Presidential Decree No.41 of 1973.

While Batam Administrative Municipality is responsible for areas in the fields of administration, community life guidance, coordination of government institution and apparatus to assist and support the success of Batam Island Industrial Region Development.