A significant increase in investment realization indicates hope that the construction of new national capital (IKN) would proceed as planned, is indicative of investor confidence.
Sorong, Papua Barat (ANTARA) - Investment commitments totaling Rp41.4 trillion (around US$2.67 billion) have been realized during Phase 1 through 3 of project groundbreakings this year at Nusantara, according to the Nusantara Capital Authority (OIKN).

"A significant increase in investment realization indicates hope that the construction of new national capital (IKN) would proceed as planned, is indicative of investor confidence. IKN is a representation of Indonesia's transition to a new, sustainable civilization as well as a brand new metropolis," OIKN head Bambang Susantono said.

The amount of investment signifies stronger investor confidence in IKN development prospects, he added.

Phase 3 of project groundbreaking took place on December 20 and 21, 2023, with the IKN Authority becoming increasingly optimistic about the rise in investor commitment.

In addition to promoting expansion and fair economic distribution across the country, this momentum will create a large number of job opportunities for the local population.

OIKN has bagged 330 Letters of Intention (LoIs) so far, with about 55 percent of applicants being domestic investors focused on the development of the national axis sector. Currently, Singapore, Japan, China, and Malaysia are the four countries that have submitted the most LoIs.

The value of investment in Phase 1 of project groundbreaking at IKN on September 21–22, amounted to Rp23 trillion (around US$1.4 billion) and involved 10 companies in the Nusantara Consortium.

Related news: More facility groundbreaking in Nusantara as investors are optimists

The companies in the Nusantara Consortium include Agung Sedayu Group (lead consortium), Salim Group, Sinar Mas, Pulau Intan, Djarum, BCA Group, Wings Group, Adaro Group, Barito Pacific, Mulia Group, and Astra Group.

Phase 2 of project groundbreaking was held at OIKN on November 1–2, with the investment value of projects reaching Rp13.1 trillion (around US$846 billion).

The Ministry of Transportation, Mayapada Hospital, Pakuwon Group, JIS, Hermina, Bank Indonesia, BPJS Employment, and PLN Indonesia broke ground on phase two. The revival of SDN 020 Sepaku, whose land was dedicated by the locals.

The government is providing several incentives and compensation to corporations interested in investing in IKN, as regulated by Government Regulation Number 12 of 2023 concerning the Granting of Business Licensing, Ease of Business, and Investment Facilities for Business Actors in the OIKN

The incentives and compensation include a corporate income tax of zero percent for 10 years, import value added tax (VAT) of zero percent, sales tax on luxury goods of zero percent, import duty of zero percent, and land and building tax of zero percent for 10 years.

"IKN is not just a city, but it is a manifestation of Indonesia's vision that is advanced, inclusive, and sustainable. The active involvement of investors signifies the collective spirit to achieve the goals of Golden Indonesia 2045, " Susantono said.

Related news: OIKN receives 323 letters of intention from investors

Translator: Aji, Alita, Azis Kurmala
Editor: Yuni Arisandy Sinaga
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