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The project to build the new capital of Indonesia continues to be suspended

04/06/2021

According to the Vietnam News Agency correspondent in Jakarta, the Indonesian government will not allocate funds to the Ministry of Housing and Public Works (PUPR) to build a new capital (IKN) in 2022, which means that this grand project continues to be suspended more than 2 years after it was announced.

Panoramic view of Jakarta, Indonesia, April 2, 2019. Photo: AFP/VNA

On June 2, speaking at a hearing before Committee V (supervising the fields of traffic, telecommunications, public works, public housing, development of disadvantaged areas) of the House of Representatives, the PUPR representative affirmed: "There is still no budget, even the 2022 budget does not have IKN's name."

In addition to IKN, PUPR's budget for 2022 will also not be allocated to the project of developing food real estate and integrated industrial zones, which has been mentioned a lot by the government and the press in the past.

In 2022, PUPR proposed a budget package of up to 100,460 billion rupiah (more than 7 billion USD), a sharp decrease from this year's 149,810 billion rupiah. Although there is no budget yet, PUPR is currently working on the design of a new capital city in East Kalimantan province. The draft law on IKN has also been included in the 2021 Legislative Development Program.

Earlier, the National Planning Development Authority said that the total amount of capital needed to move the capital from its current location in Jakarta to East Kalimantan province amounted to 486 trillion rupiah, in which 265,200 billion was mobilized through the public-private partnership program (PPP),127,300 billion from private special funds, and 93,500 billion from the state budget.

However, the Ministry of Finance did not allocate funds to IKN this year. Mr. Brahmantio Isdijoso, Director of the Department of Government Assistance and Infrastructure Funding Management under the Ministry of Finance, said that the government is still focusing on responding to the COVID-19 pandemic.

Speaking to the press, Mr. Brahmantio said: "After the outbreak of the COVID-19 pandemic, the government focused all its resources on the response. As far as I know, so far there is no budget for IKN."