STRENGTHENING CONTRACTUAL GOVERNANCE FOR SUSTAINABLE INFRASTRUCTURE DEVELOPMENT IN INDONESIA: BALANCING PUBLIC INTEREST, FOREIGN INVESTMENT, AND LEGAL ACCOUNTABILITY

Abstract

This study develops the Balanced Contractual Governance Framework (BCGF), a normative governance framework designed to reconcile public interest protection with legal certainty for foreign investors in Indonesia's sustainable infrastructure sector. Employing normative legal research, the study integrates statute, conceptual, case, and comparative approaches to examine the coherence of Indonesia's investment and infrastructure regulatory framework. The analysis combines normative harmonization with cross-case synthesis of five strategic investment and public procurement cases PT Freeport Indonesia, PT Newmont Nusa Tenggara, the Chromebook procurement program, nominee agreements, and the Just Energy Transition Partnership (JETP) to identify recurring contractual governance vulnerabilities. The findings demonstrate that rigid contractual arrangements, fragmented regulatory coordination, inadequate post-award oversight, and the absence of enforceable sustainability obligations collectively undermine contractual resilience and increase governance risks in long-term infrastructure investment. Building upon these findings, the study develops the Balanced Contractual Governance Framework (BCGF), comprising five interrelated governance pillars: Public Interest Protection, Investor Legal Certainty, Transparency and Accountability, Dynamic Risk Allocation, and Sustainability Performance. The framework contributes to the contractual governance literature by providing an integrated normative architecture that strengthens contractual adaptability, regulatory accountability, and sustainable infrastructure governance while offering practical guidance for future legal and institutional reforms