Image source: BPMI Setpres/Muchlis Jr

The Indonesian Parliament (DPR) officially approved on Friday, June 6, the government’s request for additional funding to accelerate the construction of the New Capital City Nusantara (IKN or Nusantara) – increasing the budget from around Rp 22 trillion (US$1.47 billion) to Rp 37 trillion. 

Head of the DPR’s Budget Committee Said Abdullah said after the meeting that the decision was taken to support the materialization of what is stated in the law and to bolster the development of Nusantara. 

He further hoped that the additional funds would be enough to complete the basic infrastructure needed to meet President Joko Widodo's plan to hold the Indonesian Independence Day ceremony in the city in 2024. 

In a separate interview by Media Indonesia, the Coordinating Minister for Maritime Affairs and Investment Luhut Binsar Panjaitan said he had consistently and intensively court investments for the development of Nusantara, adding that the government had prepared various incentives for investors. 

He said the government was offering 6,700 hectares of land to investors. The development priority in the first phase was focused on the central government core area (KIPP) – which includes the Presidential Palace – and that foreign workers would be employed to ensure the quality of the final construction.  

Indonesia issued Law No. 3/2022 concerning the State’s Capital as the legal basis for the continuation of the Rp 466 trillion project.  

Article 24 states that the funding for Nusantara as a national priority program is sourced from the State budget and/or other legitimate sources in accordance with the provision's legislation. 

The article also asserts that Nusantara’s construction phase will include five stages to start in 2022 and to be completed in 2045 to coincide with the 100th anniversary of Indonesia's independence. 

The first stage, which is slated to be completed by 2024, is expected to be achieved soon as President Joko Widodo is expected to move to Nusantara and occupy KIPP before August 16, 2024.