Indonesia Allocates $3b for Nusantara Capital’s Next Development Phase

Yovanda Noni
January 22, 2025 | 1:23 pm
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President Joko "Jokowi" Widodo and his successor Prabowo Subianto check on the progress of the new capital project Nusantara on Aug. 12, 2024. (Photo Courtesy of Presidential Press Bureau)
President Joko "Jokowi" Widodo and his successor Prabowo Subianto check on the progress of the new capital project Nusantara on Aug. 12, 2024. (Photo Courtesy of Presidential Press Bureau)

Penajam Paser Utara. The government has approved a budget of Rp 48.8 trillion ($2.99 billion) for the second phase of Nusantara's development, Indonesia's new capital, for the 2025-2029 period. This marks a significant reduction from the Rp 89 trillion allocated for the first phase in 2022-2024.

"Rp 48.8 trillion has been approved by the President to complete the development," said Basuki Hadimuljono, Head of the Nusantara Capital Authority, in Jakarta on Tuesday.

Basuki revealed that President Prabowo Subianto aims to make Nusantara the political capital. He added that his responsibility includes completing the judicial and legislative ecosystem infrastructure, such as offices and residences.

The government had spent Rp 89 trillion on the first phase of development, which ran from 2022 to 2024.

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"A budget of Rp 48.8 trillion is needed primarily to complete the legislative complex, judicial facilities, and supporting ecosystems, as well as to open access to the second planning area of Nusantara," Basuki said.

This budget will also be used to maintain and manage completed infrastructure and facilities in Nusantara. Basuki said the Public Works Ministry and the Housing and Urban Development Ministry have handed over the management and maintenance of Nusantara to the authority.

Additionally, the Nusantara Authority is overseeing a Public-Private Partnership (PPP) program worth Rp 60.93 trillion, which is currently in progress. This includes six road construction projects, a 138.6-km multi-utility tunnel (MUT) in the Core Government Area, a solar power plant project, and the planned groundbreaking for the ninth phase of investment projects.

"The feasibility study is underway for 97 apartment towers and 129 landed houses. We are also continuing the PPP, reporting to the President on the development of hotels, residences, retail, and office buildings, totaling Rp 6.49 trillion," Basuki said.

Chief Infrastructure and Regional Development Minister, Agus Harimurti Yudhoyono (AHY), said the development focus would be on the core government area, establishing Nusantara as a political capital with completed government facilities, including legislative and judicial institutions. 

"The cooperation between the government and business entities is expected to enable the private sector to contribute positively and integrate effectively," he added.

Meanwhile, Housing and Urban Development Maruarar Sirait Minister reported that 27 towers in Nusantara are ready for inauguration, along with the minister’s official residences.

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