A worker walks in front of the State Palace at the government offices complex in the Nusantara Capital City in North Penajam Paser, East Kalimantan. Construction of road infrastructure in KIPP 1B has also begun, driven by growing private investment. — The Jakarta Post
JAKARTA: Nusantara Capital Authority (IKN) head Basuki Hadimuljono says the government remains committed to continuing the construction of the new capital, asserting there would be no halt to the process.
In an statement last Sunday, he outlined that the central phase of development, dubbed KIPP 1A, which includes the construction of the State Palace as well as the judicial and legislative complexes, is slated for completion in 2028.
“The palace has announced that there will be no moratorium, and that construction of the new capital city Nusantara will instead be accelerated,” Basuki said.
“President Prabowo Subianto has ordered the completion of the judicial and legislative branches within three years. Nusantara is a national priority project mandated by law and already has an allocated budget.”
Construction of road infrastructure in KIPP 1B has also begun, driven by growing private investment. Supporting infrastructure is also a key focus during this phase.
“The influx of investment has allowed us to accelerate development in other zones,” he added.
Basuki previously stated that all preparatory work for the second phase of Nusantara development, including budgeting, had been completed.
The second phase, which will begin with a tender process this month, is set to focus on constructing the legislative and judicial zones along with their supporting infrastructure.
The budget for this phase totals 48.8 trillion rupiah or about US$2.9bil through 2028, as approved by President Prabowo in January. It covers office buildings, housing for legislative and judicial staff and related infrastructure.
Of that amount, 14.4 trillion rupiah was allocated for developing key areas within KIPP this year, including road access to government buildings.
Next year, the budget rises to 17.08 trillion rupiah, plus an additional 4.1 trillion rupiah approved by the Finance Ministry. The 2027 budget is set at 14.64 trillion rupiah, followed by 2.68 trillion rupiah in 2028.
Sudiro Roi Santoso, IKN’s deputy for funding and investment, emphasised the importance of building an ecosystem that goes beyond government facilities.
“We need crowded places, lifestyle amenities and sports infrastructure to make Nusantara not just a city of buildings, but a place where people truly want to live,” he said in a statement.
The authority’s secretary, Bimo Adi Nursanthyasto, explained that there are currently 1,200 civil servants in Nusantara, and up to 5,000 construction workers.
Once the main buildings become operational, the area is expected to host 25,000 inhabitants, along with thousands of local tourists.
He also said that 16 ministries have been selected for early relocation, involving 3,500 civil servants.
Although the government has committed 48.8 trillion rupiah from the state budget to support Nusantara’s second phase through 2028, doubts persist regarding President Prabowo’s true commitment to the project, Tenggara Strategics noted on July 24.
Despite earlier pledges to begin working from Nusantara by August 2028, he has shown little urgency in moving the project forward.
This year’s Independence Day celebration will be held in Jakarta, unlike last year when former president Joko “Jokowi” Widodo hosted the event in the new capital.
Since taking office, Prabowo has prioritised flagship programmes such as free meals and food self-sufficiency, leaving Nusantara with limited fiscal and political backing.
Budget shortfalls have already affected infrastructure spending, while private investment, expected to finance 80% of Nusantara’s total cost, remains tepid. — The Jakarta Post/ANN
