The area where the new Indonesian capital will be built, between North Penajam Paser and Kutai Kartanegara districts in East Kalimantan. (Photo courtesy of the Transportation Ministry)

New Indonesian Capital to Get Eco-Friendly Public Transportation


SEPTEMBER 19, 2019

Jakarta. The Transportation Ministry will build an eco-friendly public transportation system relying on a smart mobility model in Indonesia's new capital, which will be built in North Penajam Paser and Kutai Kertanegara districts in East Kalimantan.

"The public transportation system has to be eco-friendly because this will be a city of the future. A sustainable city, a smart city with a smart mobility model. Electric vehicles will take the lead," Transportation Minister Budi Karya Sumadi said in Balikpapan – a few hours away from the location of the new capital – on Thursday.

He said the new Indonesian capital will also be designed to become a new tourist destination.

East Kalimantan already has a decent transportation infrastructure, which will lessen the strain on the state budget for building the new capital, the minister said.

"Transportation will not eat much of the budget [to build the new capital], since the existing system is already excellent," Budi said.

For example, the airports in Balikpapan and Samarinda are already under the management of airport operator Angkasa Pura I (AP I) and no longer require funding from the state budget.

"Even if we build another airport, it could be funded by AP I or someone else from the private sector so the state won't have to spend a dime," he said.

Budi said the private sector will be involved in building railways, toll roads and ports for the new capital. 

"The private sector makes the investment, and if it runs into deficit, we will pay it back in long-term loans. Balikpapan has a large population so we need new toll roads. Private companies will build the new port," Budi said.

Balikpapan already has an international airport, the Sultan Aji Muhammad Sulaiman Airport, and three ports, Semayang, Kampung Baru and Kariangau. Samarinda has the APT Pranoto Airport and a single port.

A toll road connecting Balikpapan and Samarinda is currently being built. Another toll road between Balikpapan and Banjarmasin is next on the agenda.

The government estimated the new capital city would cost a total of Rp 486 trillion ($34 billion) to build, but private investors are expected to cover most of the cost.

National Development Planning Minister Bambang Brodjonegoro said the government could only set aside Rp 94 trillion from the state budget to acquire land and build basic service infrastructure and the most important state buildings.

Bambang said a public-private partnership scheme is expected to attract Rp 265 trillion from the private sector and state-owned construction firms. Investment from the private sector is expected to pull in Rp 127 trillion to be spent on infrastructures including airport upgrades, ports and toll roads.