Located in East Kalimantan Province, the new capital is expected to help Indonesia achieve its goal of becoming a developed country by 2045, in keeping with the Golden Indonesia vision.
With President Joko "Jokowi" Widodo's Indonesia-centric development approach, IKN is expected to help build an equitable economy, where the country's development is not just focused on Java, its most populous island.
The start of Nusantara's development was marked by a ritual on March 14, 2022, during which water and soil taken from each Indonesian province were combined.
The ritual took place in North Penajam Paser, a district in East Kalimantan, and was attended by 34 governors and 15 prominent figures from East Kalimantan.
"This ritual is a symbol of diversity and unity among us in the development of Nusantara," President Widodo said at the event.
Based on the Nusantara Smart City Blueprint, the city's development has been divided into five phases, with the first phase (2022–2024) involving the relocation of the capital from Jakarta to Nusantara.
The second phase (2025–2029) will involve building IKN as a strong core area. In the third stage (2030–2034), Nusantara's development will be made more progressive. In the fourth (2035–2039), all infrastructures and ecosystems in three cities connected with IKN will be developed.
In the fifth phase (2040–2045), the government will work to strengthen Nusantara's reputation as a world-class city for all.
So far, groundbreaking for several projects has been carried out at IKN, including a football training center, hospitals, hotels, and malls.
On August 17, 2024, Indonesia marked new history by holding the Independence Day anniversary commemoration in IKN for the first time.
The Independence Day ceremony in the new capital was led by President Widodo, who was accompanied by President-elect Prabowo Subianto.
Continuation of development
Prabowo stated that the Independence Day ceremony in 2025 will also be held in the new capital, but he has not yet confirmed whether it will take place at both Merdeka Palace in Jakarta and the State Palace in Nusantara, as it did in 2024.
The President-elect has been clear about his commitment to continuing IKN's development during his presidency.
"I have said many times that I am determined to continue it, if possible, complete it. I think Mr. Jokowi has taken a historical role; he initiated it (the development), the least I can do is to continue it," he said.
Prabowo also expressed optimism that he will be able to fulfill people's hopes regarding the benefits of shifting the capital from Jakarta to Nusantara.
Continuing the development of the new capital is indeed one of the 17 priority programs of Prabowo and Vice President-elect Gibran Rakabuming Raka.
The two will also seek to realize more equitable development in the country by creating new centers of growth outside Java island, including Nusantara.
For funding the new capital's development, an allocation of Rp15 trillion (around US$969.3 million) has been earmarked in the 2025 state budget.
Deputy Minister of Finance II, Thomas Djiwandono, noted that the allocation comprises Rp5.89 trillion (around US$380.6 million) for the Nusantara Capital Authority (OIKN) and another Rp9.11 trillion (around US$588.7 million).
He expects that the figure may increase in accordance with the needs of the next government.
However, he reminded the next government not to rely on the state budget to fund the new capital's development because the budget is targeted to fulfill just 20 percent of the total funding needs of the city's development.
From 2022 until now, the total state budget allocation for Nusantara's development has reached Rp76.5 trillion: Rp5.5 trillion in 2022, Rp27 trillion in 2023, and Rp44 trillion in 2024.
This is equal to 16.42 percent of the total funding of Rp466 trillion needed for the new capital project, based on government estimates.
Therefore, Djiwandono said, the next government must seek long-term solutions for financing the project using private investments.
On October 8, 2024, Jokowi told the press in Jakarta that investments in IKN's development had reached Rp58 trillion, adding that he was optimistic the target of achieving Rp100 trillion in 2024 would be realized.
Despite the progress in the development of the new capital, Jokowi has yet to sign the presidential decree on the capital relocation from Jakarta to Nusantara.
Coordinator of Presidential Special Staff, Ari Dwipayana, explained that Widodo has left the signing of the decree to President-elect Prabowo due to considerations regarding the development process of the capital city ecosystem, which is still ongoing.
Dwipayana assured that Nusantara's development will continue because its continuity has received full support from Prabowo.
After the inauguration of Prabowo and Gibran as President and Vice President on October 20, the public will look forward to the fate of the ambitious capital city project.
With the city aspiring to be a "world city for all," the public will certainly wait to see all the benefits that Nusantara will bring.
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Editor: Tia Mutiasari
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