Bukit Soeharto, a forested area between the districts of Penajam Paser Utara and Kutai Kartanegara, in East Kalimantan Province - Photo by National Development Planning Ministry

JAKARTA (TheInsiderStories) – Indonesia will start the construction of the new capital city in 2021, with a view to having the administrative center fully operational by 2024, officials said today (11/15). Currently, ministries are drafting a presidential regulation on the authority agency for the new capital preparation, relocation, and construction that will be presented to President Joko Widodo next week.

“We all agree that this planning can be completed within a year and when everything is ripe, we will start the construction in early 2021. The construction will be targeted for three years,” Coordinating Minister for Maritime and Investment Affairs Luhut Binsar Pandjaitan told reporters after holding a closed meeting with the number of state officials.

Besides Pandjaitan, attended the session was Coordinating Minister for Human Development Muhajir Effendy, Legal and Human Rights Minister Yasonna Laoly, Development Planning Minister Suharso Monoarfa and Jakarta Governor Anies Baswedan.

The authority agency will be filled by neutral professionals, not bureaucrats and reporting directly to the President, Monoarfa said. The minister promised regulations related to the formation of the agency would be completed before the end of the year.

Meanwhile, about the composition, Monoarfa explained that the agency would have a steering committee and a supervisory committee. Both have their respective functions and duties to ensure their work effective, he adds.

Monoarfa also said, there were many issues that had to be defined and determined, especially regarding the form of the capital, for example, what the autonomous region would be like, what the special region was like, then what the district or central government would be.

“Later the function of the capital is whether as the capital of the state or the government, of course, we want it to be the capital of the state as well as the capital of government,” he said, saying if it is just the capital of the government, it means that only the government has moved, meaning that the ministry or state institution is still in Jakarta, but if the form of the capital of the state, then all moved.

Widodo has announced the location of new capital in East Kalimantan Province, the Indonesian part of Borneo island. He cited the need to ease the burden on Jakarta and the rest of Java island, and to jump-start the economy in other parts of the archipelago nation.

The new capital location will straddle two districts: Penajam Paser Utara and Kutai Kartanegara in East Kalimantan Province, the province’s two largest cities, which are a two-hour flight from Jakarta. The capital will be built on 180,000 hectares of land already owned by the government, thereby minimizing the cost of land acquisition. Earthquakes, flooding, and volcanic eruptions are less common in that area.

“Why the urgency now? Because we cannot let Jakarta and Java island continue to carry a burden that is getting heavier from population density, severe traffic jams, and air and water pollution that need to be tackled,” the president said.

“The economic gap between Java and outside Java has continued to widen despite the regional autonomy policy launched in 2001,” he added. He noted that 54 percent of Indonesia’s more than 260 million people reside on Java and 58 percent of the country’s gross domestic product is produced on the island, despite its being the smallest of Indonesia’s five major islands.

Balikpapan is home to oil refineries and a port, making it an economic center of Kalimantan. Samarinda is the capital of East Kalimantan Province. Compared with other parts of Kalimantan previously considered, much of the necessary infrastructure is already in place. Both cities have an international airport, and they could be connected to the rest of the island via highways and railways.

Widodo earlier said he wants the new capital to be green, smart city, meaning he wants it wired with the latest information and communications technology. The aim is also to keep the city compact, so it does not harm surrounding tropical rainforests.

The move will cost an estimated Rp466 trillion (US$32.82 billion), with the government intending to cover 19 percent of the cost. The rest is expected to come mainly from public-private partnerships, as well as direct investment by state-owned enterprises and the private sector.

US$1: Rp14,200

Written by Lexy Nantu, Email: lexy@theinsiderstories.com