Is Nusantara turning into white elephant for Indonesia?
A year after its inauguration, Indonesia's new capital, Nusantara, remains largely a ghost city, with its ambitious construction slowed by a slashed budget and a lack of political momentum under the new administration. While the city's architecturally striking presidential palace and freshly built avenues stand ready, the project's future is in question.
Nusantara, envisioned as the replacement for the crowded and rapidly sinking Jakarta, was a flagship legacy project of former President Joko Widodo. However, the city is struggling to attract residents, with only about 1,000 city authority employees and a few hundred more government workers living in a place designed to house two million people by 2045.
According to public policy expert Dedi Dinarto, the new president, Prabowo Subianto, appears to be prioritizing social welfare programs over the capital move. "The political will on IKN [Ibu Kota Nusantara] right now feels muted," Dinarto said.
This shift in focus is evident in the project's budget, which has been significantly reduced from 43.4 trillion rupiah ($2.66 billion) in 2024 to just 6.3 trillion rupiah requested for 2026.
An official involved in the city's construction, speaking on the condition of anonymity, expressed skepticism about the project's completion, stating, "I'm still 50-50 on it." The official added that the budget cuts mean "a lot of things will not be completed."
A Change in Momentum
The pace of construction has notably slowed since President Prabowo took office. Sofian Sibarani, the city's designer, noted that only 800 of the planned 6,600 hectares of the core government area have been developed or prepared.
Despite the challenges, Nusantara officials remain optimistic. City authority head Basuki Hadimuljono claimed that projects in the core executive area are "already 97-98 percent" complete. He maintained that Prabowo intends to move to the new capital by 2028, but the new president has yet to sign the official decree needed to begin the shift from Jakarta.
Life in the new capital
The city currently offers three hospitals, coffee shops, and a toll road, with an airport awaiting commercial flight approval. While some government employees, like Helena, say the city offers "an amazing level of comfort," local businesses are struggling.
Abduh Rajab, a snack seller, said his earnings have dropped by nearly 60% since the construction boom slowed. "I have to stay optimistic," he said, hoping that construction will continue. The presidential palace, designed in the shape of a mythical Garuda bird, has become a major draw for tourists, but for many, the city's future remains uncertain.