Jakarta. Indonesia is making some progress with its ambitious capital relocation plan to East Kalimantan, as close neighbor Malaysia inked a string of letters of intent related to the megaproject during Malaysian Prime Minister Anwar Ibrahim’s visit to Jakarta on Monday.

Ten Malaysian firms, including property developer Boustead Properties, have expressed interest to invest in Nusantara — the official name of Indonesia’s yet-to-be-built capital city.

Malaysia handed over the inked letters to the Nusantara Capital City Authority before the meeting between Anwar and President Joko “Jokowi” Widodo at the Bogor Palace.

“I welcome Malaysian investors’ interest in the development of Nusantara. Malaysia’s private sector has signed 11 letters of intent to support the Nusantara project in the fields of electronics, health, waste management, construction, and property,” Jokowi said in a joint news conference.

Nusantara has greatly piqued the interest of Sarawak and Sabah, two Malaysian states located on the Borneo island, primarily due to their close proximity to the new capital city and the potential economic benefits, according to Anwar. 

“There are Malaysian interests here, particularly Sarawak and Sabah, [in this capital project] because of their close proximity [to the city] and the meaningful economic interests in the region," Anwar said.

“We are embracing a positive approach to make sure that Nusantara development benefits the region, including Sarawak and Sabah,” he added.

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Some of the Malaysian investors inking the letters of intent were lighting supplier Success Electronics and used car marketplace Carsome. Success Electronics sought to build smart LED street lighting in Nusantara, Malaysian news outlet Bernama reported.

Other signees included aluminum and copper producer Olympic Cable Company (OSK Group) and pharmaceutical company Pharmaniaga.

Malaysian real estate giant Berjaya Corporation is offering its expertise in solid waste management and smart city technology, while Alliance MEP (Sarawak) aims to provide professional services. Boustead Properties intends to share its knowledge on sustainable smart intelligent townships. 

Construction solutions provider Protasco eyes developing infrastructure and government housing through its subsidiary HCM Engineering, according to Bernama. 

I2 Energy — a solar service provider formed by a merger between Protasco and Icon Energy — plans to develop renewable energy and charging stations, thus paving the way for Jokowi’s dream of making Nusantara a green city.

Malaysia’s Reneuco seeks to provide sustainable energy and utilities services.

Bernama also wrote that utility firm Tenaga Nasional also showed interest in the development and operation of energy solutions.

Indonesia needs approximately Rp 466 trillion (about $29.9 billion) to build the new capital. The Southeast Asian country will mostly rely on investors to fund the megaproject, while only 20 percent of the funding comes from the state budget.

The Malaysian government reported that Indonesia ranked the country’s seventh largest global trading partner and third biggest within ASEAN in 2021, with trade totaling RM 95.31 billion or $22.98 billion.

Bilateral trade went up 41.7 percent to $27.31 billion in the first eleven months of 2022. This puts Indonesia in sixth place on Malaysia’s top global trading partner ranking, and its second-largest within ASEAN.

This also marked Anwar’s maiden visit to Indonesia since taking office in November last year.