Agencies, Jakarta – The House of Representatives has approved a bill to relocate the nation's capital from Jakarta to a jungled area of East Kalimantan, the head of National Planning Agency (Bappenas) said on Tuesday.
The new state capital law, which provides a legal framework for President Joko "Widodo" Widodo's ambitious $32 billion mega project, stipulates how development of the capital will be funded and governed.
"The new capital has a central function and is a symbol of the identity of the nation, as well as a new centre of economic gravity," Bappenas head, Suharso Monoarfa, told lawmakers after the bill was passed into law on Tuesday, quoted by Reuters.
The new centre will be called "Nusantara", a Javanese name for the Indonesian archipelago chosen by the President, Suharso announced on Monday.
Plans to relocate the government from Jakarta, a bustling megacity of 10 million people that suffers from chronic congestion, floods and air pollution, have been floated by multiple presidents, but none have made it this far.
Jokowi first announced the plan in 2019, but progress was delayed by the pandemic.
Indonesia has envisioned the new capital as a low-carbon "super hub" that will support pharmaceutical, health and technology sectors and promote sustainable growth beyond Java island.
But critics say the law was rushed through with limited public consultation and environmental consideration.
Nusantara – which follows the creation of new capitals in countries like Brazil and more recently Myanmar – will be led by a chief authority whose position is equivalent to a minister, deputy chair of the bill's special committee, Saan Mustofa, said on Monday.
Among those being considered for the position, according to local media reports, are former research and technology minister, Bambang Brodjonegoro, and Jakarta's former governor, Basuki Tjahaja Purnama, better known as or Ahok.
Bappenas has estimated that the construction of Indonesia's new capital city in East Kalimantan will take decades, indicating that the project will stretch far beyond President Joko "Jokowi" Widodo's current and final five-year term.
Suharso told lawmakers in September last year that the agency estimated 15 to 20 years would be needed for the relocation, including all requirements.
Suharso, who also serves as national development planning minister, said the agency would divide the development period of almost two decades into several stages, each with its own tasks and timeline.
The city is to occupy an area of 256,000 hectares in the East Kalimantan regencies of North Penajam Paser and Kutai Kartanegara. As the future capital, it would take some of the pressure off Jakarta, which currently serves as both the country's administrative center and business hub.