Batam Island with an area of 415 km2 situated 20 km at southeast of Singapore, has been developed since 1970 based on Presidential Decree No. 65 of 1970. At the first stage is limited as logistic and operational basis of business related to oil and gas exploration by PN Pertamina under management of DR Ibnu Sutowo as President Director of PN Pertamina at that time.

Aware of its potential due to the location of Batam Island which very strategic, that is at Singapore strait passed voyage ways very lively, the government considered necessary to develop Batam Island into an Industrial Region which has importance meaning for the national economic growth in general. Based on this situation, the government issued Presidential Decree No. 74 of 1971 dated October 26, 1971, which states Batam Island as an Industrial Region. Further, a master plan of Batam Island Industry Development has been set-up by Consultant Nissho Iwai and Bechtel Corporation with PN Pertamina in 1972.

The following year, with consideration to improve as smoothen the implementation of Batam Island Industry Regional Development, the Government issued the Presidential Decree No. 42 of 1973 dated November 22, 1973 with states that all the area of Batam Island is to be developed as an Industrial Region accompanied by stipulation of several industrial areas as Bonded Area, there area at the west part of Batam Island, the area at Batu Ampar region and the area at Sekupang region west part of Batam Island, in accordance with the Presidential Decree No. 33 of 1974, dated June 29, 1974. There after this Bonded Area was extended covering entire Batam Island based on Presidential Decree No. 41 of 1978, November 24, 1978.

The problem of assignment and utilization of land at Batam Island is regulated in Presidential Decree No. 41 of 1973 on point (3), that is on chapter III article 6 paragraph 2 stating: Matters related to the land administration within Batam Island Industry Region Area is further regulated by Minister of Home Affairs and accordance with the prevailing Law Regulation, on provision as follows:

1. The entire land area situated at Batam Island, is transferred with Right to use (HPL) to chairman of Batam Industrial Development Authority (BIDA).
2. The said Right of Management at sub-a of this paragraph, provide authorization to the chairman of Batam Industrial Development Authority (BIDA).

• to plan the assignment and use of the said land
• to use the said land for the purpose of implementing is task
• to hand said part of land to the third party with Using Right inn accordance with the provision of article 41 through article 43 Basic Law of Agrarian.
• to receive income/compensation money and yearly obligatory money.

Specification of Management and Land-Use at Batam Island Industry Region as stipulated through Decree of the Minister of Home Affairs No. 43 of 1977 dated February   18, 1977.

Based on the Presidential Decree No. 80/M of 1976 dated June 1976, the Chairman of Batam Industrial Development Authority, lieutenant General (TNI) Dr. H. Ibnu Sutowo was replaced by DR. J.B. Sumarlin, which at that time occupied the position as the State Minister of State Apparatus Reform/Deputy Chairman of Bappenas (National Planing Board)

Further, based on Presindetial Decree No. 194/M of 1978, dated August 28, 1978, Professor Dr. Ing. B.J. Habibie was appointed as Chairman of Batam Industrial Development Authority replacing DR. J.B. Sumarlin.

By observing the development and progress of Batam Area as Industrial Region, the government need to regulate the execution of administration at Batam Area in a more efficient way and effective, by issuing Government Regulation No. 34 of 1983 dated December 7, 1983 concerning the establishment of Batam municipality at the Area of Riau Island level I province consisting of 3 District, 1 village and 11 sub-villages.

The government is aware of this existing of Batam Industrial Development Authority in the forming of Batam Municipality based on Government Regulation No. 34 of 1983, so in chapter 10 article 17 is stated the mattes relating to administration implementing referred to in this Government Regulation with the execution of Batam Island Industry Regional development, is regulated by the Presidential Decree.

Based on the said provision above mentioned, then Presidential Devree No. 7 of 1984 dated January 23, 1984 has been issued on working relation between Batam Municipality with Batam Industrial Develoopment Authority, of which the principle states that :

1. Batam Industrial Develoopment Authority is responsible of implementation  Batam Island Industry Regional Development based on the plan stipulated by Batam Authority.
2. Batam Municipality Head of Area is the single Authority in the field of administration, guiding the life of Batam Municipality Community in all fields, and to coordinate Regional assistance and development supported of Batam Island Industry.

With the rapid interest of Investor to invest their capital in Batam Island, while the land available is already limmited, then based on the Presidential Decree No. 28 of 1992, dated June 19, 1992, Rempang Island, Galang Island and 39 other island around, are included within Batam Island Industry Regional Working Area and its stipulation as Barelang Area is based on the Presidential Decree No. 28 of 1992, above mentioned, three teams have been formed, there are :

1. Team of Master Plan Arrangement, carried out by the univerisity of Indonesia with counterpart inter Departmental Institution, they are : Region Administration Riau, Batam Municipality, Department of Defence and Security, Department of Public Work, National Land Affairs Agency and Batam Authority.
2. Team of Bridge and Barelang Transway Development executed by LAPI-ITB
3. Team of Study Preparation regarading Social, Culture, Economic and Politic carried out by Gadjah Mada Univeristy which at this moment at this stage of discussion

As follow up of Presidential Decree No. 28 of 1992 on point 6 realted to management and administration of land within Rempang Island Area and Galang Island regulated bu the Head of National Land Affairs Agency, Decree of the State Minister      of Agrarian/Head of National Land Affairs Agency has been issued, No, 9-VIII-1993 on Management and Land Administration in Rempang Island Industrial Region, Galang Island and other islands aroung dated June 3, 1993.