Mining Concessions for Muhammadiyah and NU

THE coyness of the Muhammadiyah Central Executive Board before accepting the government’s offer of a mining concession is like a low-quality drama. After asking for time to study, and then accepting the offer from President Joko Widodo, Muhammadiyah has not only disappointed its members, but also the public. It is now difficult to deny the opinion that the religious mass organization will never again be independent and will be readily manipulated by the government.

This decision emerged in a plenary meeting of the Muhammadiyah Central Executive Board in Jakarta on July 13, which was then backed by a national consolidation forum in Yogyakarta on July 27-28. This forum saw protests because the central leadership decision was at odds with a ruling issued by the Muhammadiyah Law and Human Rights Council on May 11, stating that the granting of mining permits without a tender process was a violation of the Mineral and Coal Law, as well as being prone to corruption.

Before this decision taken, several Muhammadiyah departments actually have conducted studies that essentially rejected the mining permit offer because it threatens environmental sustainability. Moreover, the leadership in a number of regions, including South Kalimantan, rejected concessions because they have felt the negative impact of the practices of the extractive industry. But the Muhammadiyah leadership ignored these voices.

Moreover, the central leadership had been subjected to persuasion by prominent individuals, businesspeople and government officials. This magazine discovered that a number of people, including former Vice President Jusuf Kalla and Investment Minister Bahlil Lahadalia, made approaches to the Muhammadiyah leadership to persuade them to accept the government’s offer.

These facts show that the religious organization is easily persuaded by material offers. The leaders simply ignored the aspirations and studies from the members because they saw them as not being beneficial. Before Muhammadiyah, the largest Muslim organization in Indonesia, Nahdlatul Ulama (NU), also accepted the offer of a mining concession from the government, which was closely linked to the return of a favor for political services in the recent election. And the offer to Muhammadiyah was closely linked to the endeavor to subdue the organization to prevent it from being critical of the government.

Hence, the offering of mining concessions to religious mass organizations has many risks. The mining business requires large amounts of capital, professional management and an ability to manage complex externalities. Lacking these abilities, these religious mass organizations will have to partner with companies or experienced mining operators.

Secondly, there is an opportunity for repossession of mining sites resulting from a reduction in the size of concession areas for holders of work contracts (PKP2B) and previous owners. Of course, this will require a complicated strategy, such as manipulation of company ownership, because Government Regulation No. 25/2024 bans partnerships between mass organizations and former holders of PKP2B or affiliated companies.

If this happens, religious organizations will become a shield to protect the interests of the oligarchs. As well as becoming proxies for mining companies, organizations such as the NU and Muhammadiyah will find themselves pitted against environmental activists complaining about the negative impacts of the extractive sector. In other words, this gift from the government will turn into a disaster because it will trigger horizontal conflicts.

Therefore, the leaders of these religious organizations should end their false narrative about economic empowerment of the faithful. By managing mines, they will be no different from companies in the extractive sector controlled by oligarchs. Accepting offers of mining concessions from the government will mean dragging these religious organizations into a sea of problems and under the influence of the government.