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Nusantara is set to be the new capital of Indonesia, but what will happen to Jakarta?

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ABC News - January 30, 2022

Hellena Souisa and Natasya Salim – The Indonesian Lower House has passed a draft law on relocating the national capital, marking the official declaration of the country's new main city after the idea was first discussed three years ago.

It took only 42 days for the Bill to be debated and passed into law earlier this month, making it the fastest bill ever passed by the Indonesian parliament.

There was almost no opposition to its ratification, as the majority of Indonesia's parliament is controlled by the coalition parties supporting President Joko Widodo's administration.

The government says Indonesia needs a new capital because Jakarta is threatened by routine flooding, heavy pollution, earthquakes, and is rapidly sinking.

When will the capital move to Borneo?

The Indonesian government and Lower House have agreed on a new capital city called Nusantara in East Kalimantan, a province on the island of Borneo.

Name: Nusantara

Location: Between North Penajam Paser and Kutai Kartanegara regions in East Kalimantan, on the Indonesian part of Borneo island

Area: 2,561 square km

Estimated budget: 466 trillion rupiah ($46 billion), about 53 per cent of which will come from the government's budget and the remainder from the private sector and state-owned enterprises

Timing of relocation: The first quarter of 2024 until 2027, with an estimated additional 25,000 public servants per year

It will be governed by someone who will be appointed directly by the president.

The law says the transfer of the capital is to occur in the first quarter of 2024, which coincides with the end of Mr Widodo's presidency.

Bhima Yudhistira Adhinegara, director of the Center of Economic and Law Studies, a Jakarta-based think tank, said the project to relocate the capital was done too quickly for political reasons.

"Political ambition in this project is dominant over economic rationality," he said, adding that the project with a budget of Rp466.9 trillion ($46 billion) risks burdening state finances.

"There's an impression that it's only for the sake of the [Widodo] government's legacy."

What will happen to Jakarta?

Jakarta governor Anies Baswedan insists the megacity of more than 31 million will remain a key urban centre.

"Jakarta will continue to be the centre of the economy, the centre of other sectors like culture, and remain as the hub of the nation," he told local media.

Muhamad Eka Yudhistira was born in the current capital and is a member of the Betawi community – an ethnic group native to the city of Jakarta and its surrounding areas.

Mr Yudhistira hopes the burden on Jakarta will ease after the relocation.

"Although the impact might not be that much because Jakarta will remain the centre of the economy," he said.

Mr Yudhistira, who works in hospitality, said it currently took him at least an hour to drive to work each day, despite only being 9.5 kilometres away.

"At least Jakarta's traffic and pollution issues would be a little bit improved," he said.

But he expressed concern that the construction of Nusantara could impact indigenous people in Kalimantan, the Indonesian name for Borneo.

"The government should really maximise the potential of the local people there, because as they said, development must be evenly distributed," he said.

Jakarta has been sinking at an alarming rate, a process known as land subsidence, with parts of the city having sunk by more than four metres since the 1970s.

But Elisa Sutanudjaja, head of the Rujak Centre for Urban Studies, said she was not worried about the fate of Jakarta.

"As a logistics hub, with the largest population in Java, I'm not too worried," she said."The land subsidence has actually started to slow down since 2010."

Ms Sutanudjaja said even if Jakarta was no longer the capital city, it would keep sinking since there was a lack of regulations, especially around building and development.

But she thinks moving the capital city might have a good impact on Jakarta because it will reduce exploitation driven by extractive development.

"Problematic projects such as the construction of a double-decker toll road in Jakarta can also be re-considered for sustainability because the influence of the central government will be reduced there," she said.

Jakarta is sinking towards disaster

By no longer being the capital city of the country, Jakarta as a province would have the opportunity to more freely regulate its own spatial planning, which had often been at odds with the interests of the central government, she said.

"A lot of Jakarta's spatial planning has been violated by the central government, for example the Senayan area in Central Jakarta, which in Jakarta's layout is a green zone but can be sold as a mall," she said.

According to Ms Sutanudjaja, decisions around spatial planning were made with political interests, economic interests, and the interests of the wider community in mind.

"So far, economic interests have always won in Jakarta. If the spatial planners and the [local] government can't be the decision maker, Jakarta will continue like that, regardless of its status as the capital or not."

That was why, she said, the future of Jakarta would depend very much on the vision of Jakarta's leaders.

Will moving the government leave empty buildings?

The Ministry of Finance has announced that the state assets in Jakarta – such as buildings owned by Indonesia's 34 ministries and the state palace – are planned to be leased to finance the building of Nusantara.

Assets owned by the central government in Jakarta were worth around Rp1,100 trillion ($108 billion), said Encep Sudarwan, director general of state assets at the Indonesian Ministry of Finance.

But authorities say that because Jakarta will remain Indonesia's economic capital, buildings owned by the central government that have previously been the workplaces of thousands of civil servants would not be empty or abandoned.

"We are optimising the assets in Jakarta so that we can get funds to develop the new capital city," Mr Sudarwan told the ABC.

"We don't always have to sell them."

Is everyone happy with the plan?

Yati Dahlia has lived in the sleepy district of Sepaku, East Kalimantan since she was born there 31 years ago.

Like many locals, she is worried it may soon become unrecognisable due to its proximity to the planned site of Nusantara.

Ms Dahlia said Sepaku residents "had never been consulted" about the development plan that would happen only kilometres away from their homes.

"This is not a forest. Many Indigenous residents live here," she said.

"Do they think we're just trees here? We are humans and we wish to be humanised. [The government] has to help us first instead of forcing their will.

"They never listen to us here."

Pradarma Rumpang, an environment activist and coordinator of the mining advocacy network in East Kalimantan, said the relocation plan would further existing environmental damage in the community, such as a critical lack of access to water.

Experts and environmentalists say some natural disasters such as floods are preventable if Indonesia ends deforestation.

"Even in normal circumstances, the clean water crisis has become a problem for these regions," he said.

"This is the main problem that has always been there. What happens when there is a population boom in a short period of time?"

Indonesia's Ministry of National Development Planning has projected the population of the capital city region will grow from 100,000 to 700,000 by 2025, and 1.5 million in 2035.

Mr Rumpang also criticised the Minister of National Development Planning Suharso Monoarfa's claim that the new capital city would create more than 1.3 million jobs.

Mr Rumpang said thousands of households "will be removed from their economic roots" as cultivators, hunters, farmers, as the result of this development.

The livelihoods of more than 10,000 local fishermen around the nearby city of Balikpapan would also potentially be impacted, he added.

Mr Rumpang warned ship traffic, carrying million tonnes of building materials as part of the industrial development, would dominate local rivers.

Ms Dahlia, whose family are farmers, is afraid development of Nusantara would force her to give up her land.

"If they force us to give up our land, what will we have left?" she said. "What should we do for our children to survive?"

The Ministry of National Development Planning has been approached for comment.

Source: https://www.abc.net.au/news/2022-01-30/what-will-happen-to-jakarta-when-indonesia-builds-a-new-capital/10078456

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