This paper studies the condition of domestic shipping transport in Indonesia. From the view point of participating in maritime transportation policy, the different systems, functions, and targets of cabotage act have been analyzed. The innumerable factors affecting the Indonesian cabotage act which has had great impact on the regional economic growth has been studies and current methods and policies are being examined. Finally, the research paper evaluates the Indonesian Cabotage Act which is part of the transport policy and it's on economic growth are summarized