At the beginning Batam Island Development idea is to utilized the geoprahical location advantage of Batam Island which is closed to Singapore and located precisely in the International service and trade lines, related to the possibility of of the saturation of Singapore in conducting its function and role as distribution service point for the south east region.

Based on the condition, characteristic and potential of Batam Island, so the objective of Batam Island Development are:

   1. For the equal distribution of the national development of which result can be aimed to the creation of social welfare, social justice and to increase the economic growth and particularly for the national stability for the development of this region.
   2. To obtain economic advantage to utilize Batam Island geographical position, which is expected will able to strengthen economic pattern through the improvement of foreign balance position.
   3. To improve the system of trade service and harbor which is orderly, clean and efficient.
   4. To expanse employment opportunities and to stimulate the expertise quality improvement.
   5. To reduce the national interdependency on Foreign distribution service point, meaning to support the national economic power improvement.
   6. to reduce the growth polarization which tends to be centralized in Jakarta, Surabaya, Medan, Ujung Pandang, so that in directly will support the national development distribution process.
   7. It is expected the existing of cooperation especially from Singapore which is mutually profitable and complete each other and which is complement in nature, especially in the field of tourism, trade and ship transfer
   8. To support the production business towards the world market.

The Presidential Decree No. 41 of 1973, has stipulated Batam Island to be developed and improved into 4 (four) main functions, namely :

   1. Industrial Estate/Bounded Area
   2. Shiptransfer and Trade Region (Transshipment point)
   3. Tourism Region
   4. Trade Region

Function as Bonded Area

Batam Island, include Janda Berhias Island, Tanjung Sauh Island, Ngenang Island, Moi Moi and Kasem Island, through the Presidential Decree No. 56 of 1984, stipulated as Bonded Area and further by the Presidential Decree No. 28 of 1992,       Rempang Island, Galang Island, Galang Baru Island and 13 islands surroundings stipulated as Bonded Area.

Batam Island Function as Transshipment Point

Batam Island function as Transshipment point is underlying by strategic position of Batam Island in the service line and world trade line, and to utilize the existing opportunity the overflow from Singapore which since the 19the century conducted said function. For Batam Island and Indonesia, the stipulation of the function means the improvement business of Foreign trade and to smoothen the goods loading and unloading activities at Batam Island in the framework to support the Industrial Estate.
Realize the importance of seaport and airport in supporting this function, the in the master plan of Batam Island, Hang Nadim airport is planned to play the role an International airport and Kabil seaport as and International seaport which terminal facilities and package container quay with an International standard.
Batam Island function as the basis of the logistic, is the first function given in 1970, arranges the implementation of Batam Island Development in its relation as the logistic center of Pertamina.
Batam function as logistic center is extended, so that nowadays Batam also function as storage place and trade for the export product and Indonesian import goods.

The Function of Batam Island as Tourism Region

Nationally, in 1983 through the Presidential Decree Number 15, it is stipulated that Foreign tourist visiting Indonesia is free from the possession of visa.
Especially, through said Presidential Decree is also stipulated Batu Ampar port as the Entrance Gate for Cruise ships of Foreign tourist groups.
In the the framework effort to improve the development of tourism in Batam Island, several regulations have been issued especially in the field Immigration among others such as follows :

-The Decree of the Minister of Justice No. M-01-PW dated July 10, 1980 renewed on January 8, 1983 concerning the stipulation of Batam Island as especial status region from the Immigration aspect in the framework of Batam Island Development as an Industrial  Estate and bonded warehouse business region.

-The Decision Letter of Director General of Immigration No. 175/SEK/VIII/1980 concerning the completion of Immigration matters in the framework of Batam Island Development, as an Industrial Estate and bonded ware house business region.