Akmalal Hamdhi, Jakarta – Finance Minister Purbaya Yudhi Sadewa tries to ease concerns that Indonesia's new capital Nusantara could become a "ghost city," saying the massive East Kalimantan development remains firmly on track and is backed by binding medium-term state planning.
Speaking after a meeting with the Regional Representatives Council (DPD) in Jakarta on Monday, Purbaya said there was no need for public anxiety over the project's continuity. "Nusantara will not become a ghost city," he said, adding that Indonesians should not be distracted by foreign media reporting casting doubt on the megaproject's future. "Don't listen to foreign predictions, they are often wrong," he noted.
The Guardian UK recently published an article warning that Nusantara could become underpopulated due to reduced budget support, declining private investment, and slow visible progress on the ground. Under President Prabowo Subianto, state capital allocations for Nusantara have indeed been reduced compared with the Jokowi administration, falling from roughly 2 billion ($2.6 billion) in 2024 to an estimated 700 million this year. Funding will be lowered again in 2026, according to the report.
The government, however, maintains that the project is moving forward on schedule and remains a national priority. Nusantara's completion target, including the relocation of civil servants and core infrastructure, is written directly into Presidential Regulation No. 12/2025 (RPJMN 2025-2029) and strengthened by Presidential Regulation No. 79/2025 on the updated 2025 government work plan. The target is for Nusantara to officially serve as Indonesia's political capital by 2028.
IKN Authority Chair Basuki Hadimuljono said the project has reached an "irreversible" phase. "We are at the point of no return. What we are building is not just a city, but the future of the nation," he said last week.
Purbaya also revealed that several private developers have already received approval to build housing clusters inside Nusantara, and those projects are now underway. He added that additional state budget contributions may be issued in the coming years, depending on need. "If the economy continues to perform well, government funds will also be available," he said.
President Prabowo has authorized Rp 48.8 trillion ($2.93 billion) for Nusantara's development across 2025-2029. The capital's financing structure is mixed, combining state budget contributions with domestic and foreign private investment.
The IKN Authority says it has so far booked Rp 225.02 trillion in commitments, including Rp 66.3 trillion in private-sector funds plus Rp 158.72 trillion in public – private partnerships covering key infrastructure such as roads, utility tunnels, and residential districts.
Source: https://jakartaglobe.id/news/finance-minister-nusantara-will-not-become-a-ghost-cit