Many countries with low to medium incomes need a long time to recover from the economic downturn caused by Covid-19. The impact of Covid-19 affects the main development priorities in Indonesia, such as poverty alleviation, the achievement of sustainable development, and the transformation of the green economy. The economic and fiscal constraints facing Indonesia need attention, and the Indonesian economy needs to establish policy criteria. The purpose of this article is to analyze the environmental problems in Indonesia and then identify the government policy related to sustainable development programs to release them. The Ministry of Finance has an essential role in the SDGs by allocating National Budget to environmental programs. Sustainable development is Indonesia’s commitment to the international community to reduce the use of carbon emissions to promote a green economy. The green economy indicators that we elaborate in supporting SDGs programs are low-carbon development, resource efficiency, and socially inclusive.

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This study investigates the impact of the enactment of bail-in regimes in 2016 in Indonesia on bank owners' propping behavior. Based on Indonesian banking data for the period 2011–2020, we use the difference-in-differences method to examine whether related party transactions substantially increase or decrease after the introduction of bail-in as an indicator of propping. We find that while the requirement for sufficient capital allocated to shock absorbance increases, bank owners may provide capital via related deposits. These deposits are typically beneficial to bank stability, increase liquidity, and can act as a propping channel. However, the deposits are also more exposed to risks, and consequently decrease.

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We investigate the implications of government versus private ownership for bank minority shareholders. Specifically, we use unique data to examine whether the stock prices of government-owned and family-owned banks, equally engaged in related lending, differently react to loan announcements. Our empirical findings show that the expected negative market reaction due to minority shareholder expropriation driven by related lending ("grabbing hand" effect), is offset by shareholders' expectations of future support from the government ("helping hand" effect). Positive announcement returns are also larger for new loans to state-owned firms than for those to private firms. Our findings support the view that in countries with weak shareholder protection, shareholders of state-owned banks rationally anticipate expropriation, but are willing to accept it in exchange for higher expectations of government support to stateowned banks and to state-owned firms.