Building a capital
in the forest

THE OPENING QUESTION

A new political centre—or a new set of risks?

President Joko Widodo announced the East Kalimantan location in August 2019. Parliament then enacted Law No. 3 of 2022, creating the new capital and its authority. The project has since acquired a palace complex, housing towers, roads, utilities and ceremonial spaces. It also acquired a powerful national story: a chance to rebalance development away from Java and to build a technologically advanced “forest city.”

But a construction site is not the same as a functioning capital. The distinction matters because government releases often describe packages awarded, investment agreements and future capacity alongside completed buildings. This feature treats four categories separately: verified achievements, work under construction, funded or contracted commitments, and future promises.

THE GEOGRAPHY

From Java to East Kalimantan

WHY LEAVE JAKARTA?

A metropolis under compounding pressure

Jakarta's difficulties are real, but they are often flattened into the misleading phrase “the city is sinking because of climate change.” The principal driver of its severe land subsidence is groundwater extraction, intensified by urban loading and the compression of sediments. Peer-reviewed work maps the relationship between groundwater use and subsidence, while more recent research also identifies soil consolidation and building loads as contributing processes (Abidin et al.; recent remote-sensing synthesis). Sea-level rise then raises the coastal baseline and compounds flood exposure; it does not by itself explain the sinking ground.

The wider urban burden includes recurrent river and coastal flooding, traffic congestion, harmful air pollution, a metropolitan population counted in the tens of millions, unequal access to piped water, overloaded waste and drainage systems, and the concentration of government and economic activity on Java. The World Bank has long linked Jakarta's subsidence primarily to intensive deep-groundwater extraction and stressed that poorer communities carry disproportionate flood risk.

WHY EAST KALIMANTAN?

Centrality, state land and lower disaster exposure

The government presented the chosen area as comparatively central within the archipelago, close to the established cities and logistics hubs of Balikpapan and Samarinda, less exposed than many Indonesian regions to major earthquakes, volcanoes and tsunamis, and containing substantial land already classified as state-controlled. Its selection also served the political goal of redistributing development beyond Java.

Those criteria do not make the site vacant. East Kalimantan is home to Indigenous peoples—including Balik, Paser and Dayak communities—settlements, farms, plantations, mining and forestry concessions, transport corridors and ecologically important forest and watershed systems. Calling the site “unused” erases overlapping customary claims, livelihoods and histories that do not always appear in formal title records.

THE ORIGINAL VISION

A smart, green “forest city”

The official master plan under Presidential Regulation No. 63 of 2022 imagines a compact, connected capital powered increasingly by renewable energy, supported by public transport and digitally managed services, with extensive green and blue networks. The Nusantara Capital Authority—the public agency managing the new capital—describes a long-term objective of restoring a landscape shaped by logging and plantations into a “forest city.”

It is an ambitious promise because the administrative boundary is not intact rainforest. Civil-society group Forest Watch Indonesia argues that remaining natural forest constitutes only a minority of the wider area and that concessions and land acquisition complicate restoration. A forest-city label therefore depends on future ecological performance—survival of planted forest, water security, habitat connectivity and emissions across the construction supply chain—not merely on landscaping around government buildings.

STATUS CHECK · 3 AUGUST 2026

What is real, and what is still promised?

Package counts: Nusantara Capital Authority, 15 July 2026. These are authority-reported figures and should be read as administrative progress data, not an independent construction audit.

PROMISES VS CURRENT REALITY

A capital in stages

WHO HAS MOVED?

People on site, but not a wholesale transfer

The Nusantara Capital Authority reported that 1,170 of its employees had taken up residence in civil-servant housing by July 2025, alongside smaller groups connected to a hospital and national institutions. In January 2026 it again assembled more than 1,100 authority staff in Nusantara. These numbers demonstrate an operational workforce; they do not demonstrate that Indonesia's ministries have transferred en masse.

As late as March 2026, the Ministry of Administrative and Bureaucratic Reform was still coordinating which civil servants could move during 2026 based on office and housing readiness. The latest defensible description is therefore: Nusantara is inhabited and administratively active, but Indonesia's central government has not completed its relocation.

THE LEGAL SWITCH

When does Nusantara actually become the capital?

Article 39 of Law No. 3 of 2022 makes the transfer effective through a presidential decree. The 2023 amendment, Law No. 21 of 2023, expanded the authority's land, planning and financing framework but did not eliminate that trigger. In May 2026, Indonesia's Constitutional Court and parliamentary commentary again treated Jakarta as the capital until the decree is issued (DPR media summary).

The most recent practical target is 2028, when the government wants Nusantara to function as a “political capital” with executive, legislative and judicial institutions. It is a milestone inside a development plan extending to 2045—not proof that the entire city, population target or forest restoration will be complete by then.

MONEY AND MOMENTUM

Rp466 trillion—and the difficulty behind the headline

The original national planning estimate was roughly Rp466 trillion, often reported as about US$32 billion at the exchange rates of the period. Early plans capped the central-government share at around one fifth and expected state-owned enterprises, public-private partnerships and private capital to finance most of the remainder. The legal framework now permits state-budget, authority-budget and other lawful funding sources.

President Prabowo's government approved Rp48.8 trillion in central spending for 2025–2029 (Nusantara Capital Authority; Reuters). Yet a 2025 budget freeze and subsequent adjustments exposed the project's sensitivity to national fiscal priorities. Private-investment headlines require particular care: letters of intent, memoranda, groundbreaking ceremonies, concession proposals and completed private buildings are different stages of commitment.

Supporters argue that public infrastructure must come first to de-risk later investment. Critics respond that this leaves taxpayers carrying the early risk while commercially attractive land and services may capture later value. Both observations can be true.

BORNEO IS NOT EMPTY

Land rights, consultation and livelihoods

Customary territories, villages and resource-based livelihoods intersect with formal state land and private concessions. Academic studies identify recurring risks: claims that are poorly documented in the state system, consultation compressed by fast project timelines, compensation that does not capture cultural or spiritual value, and uncertainty about access to farms, forests, rivers and burial grounds (Journal of Government Science; Indigenous participation study).

Government agencies describe mapping, compensation and community-engagement processes. Civil-society organisations including WALHI and local coalitions report residents who feel pressured, insufficiently consulted or insecure about land. These are not interchangeable claims: each dispute requires parcel-level evidence, meaningful consent processes and accessible remedies. The existence of compensation does not by itself establish that consultation was fair.

ENVIRONMENTAL TEST

Can building a city restore a landscape?

Nusantara sits within Borneo's globally important ecological region, near habitats used by threatened species and watersheds already affected by extraction and land conversion. Construction brings direct clearing, quarrying, roads, noise, sediment, material demand and carbon emissions. A larger population adds water, food, energy and waste pressures. The risk is not limited to the core zone: easier access can drive secondary development beyond it.

The government's counterargument is that the chosen landscape was already degraded and that strong planning can rehabilitate it, concentrate growth and avoid the uncontrolled expansion seen elsewhere. Whether that happens should be judged through transparent indicators: native-forest cover and survival, wildlife connectivity, water balance through dry seasons, lifecycle emissions, waste treatment and limits on speculative sprawl. A ceremonial tree-planting count is not enough.

Water availability deserves particular scrutiny. Official plans rely on reservoirs, raw-water systems and catchment protection. Visitors may see new water infrastructure, but long-term security depends on rainfall variability, competing demand and protecting upstream ecosystems—not solely on installed capacity.

INEQUALITY AND LABOUR

Who builds the city, and who benefits?

A capital can create jobs, markets, roads, education and health services. It can also raise land prices, privilege connected investors and produce a polished administrative enclave beside communities with weaker tenure and services. Construction workers face familiar Indonesian-sector risks around subcontracting, accommodation, wages and occupational safety; public reporting is not yet sufficient for a complete project-wide assessment. Where evidence is absent, claims of either exemplary or abusive conditions should not be invented.

The distributional questions are concrete: Will local people qualify for skilled permanent work? Will public housing remain affordable? Will traditional livelihoods retain access to land and water? Will services extend beyond the core government district? And will affected communities have power over decisions, not merely invitations to information sessions?

THE BEST ARGUMENTS

Supporters and critics are asking different questions

WHAT OTHER CAPITALS TEACH

Brasília and Putrajaya are warnings as well as models

Brasília proved that a state can move its political institutions and use modernist planning to project a national future. It also became associated with car dependence and a sharp separation between the monumental centre and peripheral workers' cities. Putrajaya demonstrates a different model: an administrative centre operating alongside Kuala Lumpur, with transfer occurring institution by institution rather than erasing the older metropolis.

Nusantara is not destined to repeat either. The comparisons simply show that relocating buildings is easier than producing an inclusive, lived city—and that former capitals remain economically and socially central long after government offices move.

VISITING NUSANTARA NOW

A construction landscape with controlled public access

Visitors can currently access selected public areas under the authority's rules, including ceremonial spaces and viewpoints associated with the core government district. The official visitor system has included Plaza Seremoni, the Titik Nol area and designated nature or public-space experiences. Access, parking, shuttle arrangements and opening windows can change around construction and state events.

TIMELINE

From announcement to the next milestone

1. 2019
   Location announced

   President Joko Widodo selects East Kalimantan after reviving the long-discussed capital move.

2. January 2022
   Capital law enacted

   Law No. 3 of 2022 creates Nusantara and its dedicated governing agency, the Nusantara Capital Authority.

3. 2022–2024
   First construction phase

   Land preparation, roads, utilities, palace precinct and housing advance; opening targets are repeatedly compressed.

4. October 2023
   Law amended

   Law No. 21 of 2023 expands land, authority, planning and financing provisions.

5. August 2024
   Independence ceremony

   A national ceremony is held at Nusantara, but the formal capital transfer and mass civil-service move do not occur.

6. 2025
   Budget and target reset

   Funding is frozen and adjusted before the government confirms a Rp48.8 trillion 2025–2029 allocation; a 2028 political-capital target emerges.

7. 2026
   Construction and partial occupation

   Authority staff work on site; ministries coordinate later transfers; major packages and access links remain under construction.

8. 2028 target
   Political capital

   Executive, legislative and judicial functions are intended to operate in Nusantara. This remains a target, not a completed fact.

9. 2045 vision
   Long build-out

   The master plan's mature city and restoration outcomes extend to Indonesia's centenary.

CONCLUSION

A project large enough to hold opposing truths

Nusantara is neither an imaginary city nor a finished capital. It is a substantial, inhabited construction project backed by law and public money, with real infrastructure and a long list of unfinished dependencies. It could redistribute state attention, demonstrate better urban systems and channel restoration into a damaged landscape. It could also deepen land conflict, fiscal risk and ecological pressure while leaving Jakarta's hardest problems intact.

The fairest test is not whether Nusantara looks futuristic from a drone. It is whether institutions genuinely move, services work beyond the ceremonial core, finance remains accountable, workers and local communities benefit, customary rights are resolved justly, and the promised forest performs as an ecosystem. Jakarta and Borneo both deserve policy grounded in those outcomes rather than in slogans.