A prominent Indigenous leader has warned that the Federal Government is rushing to develop northern Australia while ignoring Aboriginal people.

North Australian Indigenous Land and Sea Management Alliance (NAILSMA) chief Peter Yu says Traditional Owners are seen as a hurdle preventing the government from fulfilling political goals.

Mr Yu addressed the recent Developing Northern Australia conference in Darwin.

He pointed out that the Government is happy to look at traditional industries like mining and irrigated agriculture, but that it is “practically silent” on economic opportunities that Indigenous people prefer, like land management, carbon sequestration, conservation and eco-tourism.

He said the lack of consultation had left the Government's White Paper on developing the north fundamentally flawed.

“Well it's predictable from an Aboriginal perspective and what it really represents is a kind of 19th century think-tank,” Mr Yu told the ABC.

“I think having a White Paper is a good thing to do, but I don't think it's expansive or inclusive enough in terms of understanding the north in its contemporary setting, particularly in regards to the demographic of the traditional owner community right across northern Australia.

“It doesn't offer anything new in terms of a reconstruction of that paradigm to the extent that we [Indigenous people] are going to be front and centre of this discussion [about developing northern Australia].”

Mr Yu said “the old way” of doing business does not work in the north.

“Currently there is no structural or formal engagement between Indigenous people and Governments over the future development of northern Australia,” he said.

“This is a huge omission and must be addressed if we are to imagine an inclusive northern Australian development future.”

The Northern Australia Infrastructure Facility (NAIF) is not even officially open yet, but has already received over $30 billion worth of bids for potential projects.

The NAIF is rolling out the Federal Government's $5 billion northern development loan scheme.

NAIF chair-designate, Sharon Warburton, says any of the plans raised would need and Indigenous engagement strategy if they were to be considered.

“I'm delighted that one of the mandatory criteria for access to NAIF concessional funding is to demonstrate Indigenous engagement,” she said.

“And we'll be looking for very well thought through diverse and broad strategies from project proponents on how they're going to achieve that Indigenous engagement.”

Mr Yu said he wanted to know more about the NAIF's methodology and definition of Indigenous engagement.

He is also concerned about the lack of Indigenous representation on the NAIF board.