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Nusantara, Indonesia new capital, development and update


Jul 25, 2013
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Nusantara is meant to balance the economic development of Indonesia. It also means to make the nation become Indonesia centric rather than Java centric. This is why the new city is built in Kalimantan island. It never means to replace or relocate Jakarta population, except for those civil servants who work for Central Government. The population in Nusantara will be limited into just around 2 million with green zone area covering 70 % of the land.

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Nusantara city will be located inside East Kalimantan province in which in term of location is in the center of the archipelago.


Nusantara has 256.142 hectare of land dan 68.189 hectare of sea. It is located near the sea which is near a very strategic Makassar strait.
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Nusantara is the Indonesian name of Maritime Southeast Asia (or parts of it). It is an Old Javanese term which literally means "outer islands".[1] In Indonesia, it is generally taken to mean the Indonesian Archipelago.[2][3]

The word Nusantara is taken from an oath by Gajah Mada in 1336, as written in the Old Javanese Pararaton and Nagarakretagama.[4] Gajah Mada was a powerful military leader and prime minister of Majapahit credited with bringing the empire to its peak of glory. Gajah Mada delivered an oath called Sumpah Palapa, in which he vowed not to eat any food containing spices until he had conquered all of Nusantara under the glory of Majapahit.

The concept of Nusantara as a unified region was not invented by Gajah Mada in 1336. Earlier in 1275, the term Cakravala Mandala Dvipantara is used to describe the Southeast Asian archipelago by Kertanegara of Singhasari.[5] Dvipantara is a Sanskrit word for the "islands in between", making it a synonym to Nusantara as both dvipa and nusa mean "island". Kertanegara envisioned the union of Southeast Asian maritime kingdoms and polities under Singhasari as a bulwark against the rise of the expansionist Mongol Yuan dynasty in mainland China.

In a wider sense, Nusantara in modern language usage includes Austronesian-related cultural and linguistic lands, namely, Indonesia, Malaysia, Singapore, Southern Thailand, the Philippines, Brunei, East Timor and Taiwan

Indonesian economy still concentrated on Java Island: BPS Head​

5th August 2022


Java Island contributes 56.55 percent to the GDP

Jakarta (ANTARA) - Indonesia's economy in the second quarter of 2022 is still concentrated on Java Island, according to Head of Indonesia Statistics (BPS) Margo Yuwono .

This is apparent from the fact that provinces in the island dominate in terms of contribution to the gross domestic product (GDP).

"Java Island contributes 56.55 percent to the GDP," he said during the 2022 Second Quarter Economic Growth Announcement observed online on Friday

This contribution came from Java Island's economic growth, clocked at 5.66 percent, during the second quarter of this year as compared to the same period in the previous year (year-on-year).

The major driver of Java Island's economic growth is the industry sector, at 1.9 percent, and trade, at 0.94 percent.

Related news: Household consumption becomes highest source of economic growth: BPS

After Java Island, the domestic economic structure is spatially dominated by Sumatra Island, at 22.03 percent, as a result of the island's economic growth of 4.95 percent (yoy).

This growth is driven by the trade sector, with contribution that reached 1.45 percent and agriculture, 0.86 percent.

Kalimantan Island contributed 9.09 percent to Indonesia's GDP, with 4.25 percent (yoy) growth, primarily as a result of the mining sector, with 1.46 percent, and trade, 0.86 percent.

Related news: Indonesia's economy grew 5.44 percent in Q2 2022

Meanwhile, Sulawesi Island managed to contribute 7.1 percent to the national GDP, with 6.47-percent (yoy) growth owing to the industry sector, with 2.29 percent, and trade, 1.18 percent.

Bali and Nusa Tenggara contributed 2.73 percent, with 3.94-percent (yoy) growth, driven by the mining sector, with 1.24 percent, as well as accommodation, food, and beverage, 0.73 percent.

Maluku and Papua Island contributed 2.51 percent, with 13.01-percent (yoy) growth supported by the mining industry, with 7.38 percent, and industry, 2.66 percent.

"However, Maluku and Papua recorded the highest growth during the second quarter of this year as compared to the other islands," Yuwono pointed out.


Investment in IKN Nusantara Increased 39 Times​

The story from Antara
•6 hours ago


Jakarta: Head of the Nusantara Capital Authority (IKN) Bambang Susantono said that investment demand for the IKN Nusantara development project reached 39 times the available capacity.

"After the market poll, there was indeed a tremendous amount of interest from the investors who contacted us. So that it is almost 40 times, exactly 39 times the areas that we are preparing for investment for this first phase," said Bambang after a limited meeting led by President Joko Widodo (Jokowi) in the Presidential Palace area, reported by Antara, Monday, November 28, 2022.

The first stage prepared to attract investment, said Bambang, is development in the core area of the central government (KIPP).


Sri Mulyani Ensures Jakarta Becomes the Economic Center of the Republic of Indonesia After No Longer Being the Capital City​

Story from coilBUSINESS • 51 minutes ago

Minister of Finance (Menkeu) Sri Mulyani ensured that DKI Jakarta will remain the center of the economy, even though the National Capital City (IKN) moved to East Kalimantan. The reason is, Jakarta has a myriad of charms.


The woman, who is familiarly called Ani, explained that Indonesia's economic growth is supported by the activities of the people of Jakarta. Not only that, all government activities in Jakarta should also not be underestimated, because they have an attachment to the Indonesian economy.

"Jakarta is not just about government buildings. But government activities that attract many other links are multipliers that should not be underestimated," said Sri Mulyani in the Workshop on Recycling and Management of State Assets, Thursday (8/12).

Sri Mulyani admitted that the government is looking for ways to redesign Jakarta. In order to be livable and able to become a center of strong economic growth for Indonesia.

Furthermore, the total state assets in Jakarta are valued at Rp 1,464 trillion. These assets need to be managed when the central government moves to IKN Nusantara.

Later, state assets in Jakarta will be managed in an integrated manner by the Ministry of Finance after being abandoned by employees of ministries or institutions that move to IKN Nusantara.

"Every asset needs to be identified how sustainable it is managed which can generate profits for the country," he continued.

List of Ministries/Institutions That Moved First to IKN​

The Ministry of Communication and Informatics revealed that there will be at least 118,000 to 180,000 civil servants who will have their first turn.

Based on a copy of Appendix II to Law number 3 of 2022 concerning IKN, the transfer of ministries and institutions that can support the role of IKN as the center of government, considers the institutional order of government.

Denah ilustrasi gedung Sekretariat Presiden yang akan dibangun Waskita Karya di IKN Foto: Dok. Waskita Karya

The first cluster of governments to move is the offices of the president and vice president. Furthermore, in this cluster there are also coordinating ministries, namely the Coordinating Ministry for Economic Affairs, the Coordinating Ministry for Politics, Law, and Security (Polhukam), the Coordinating Ministry for Human Development and Culture (PMK), and the Coordinating Ministry for Maritime Affairs and Investment (Marves).

Then also the triumvirate ministries (Ministry of Internal Affairs, Ministry of Foreign Affairs, Ministry of Defense). As mandated by the 1945 Constitution, these three ministries serve as acting presidential duties if the president and vice president are unable to do so.

Furthermore, the ministry directly supports the performance of the president and vice president. Starting from the Ministry of State Secretariat, Cabinet Secretariat, Presidential Staff Office (KSP), and Presidential Advisory Council (Wantimpres). Furthermore, the ministries that support the preparation of basic infrastructure in IKN, namely the Ministry of Communication and Information, the Ministry of PUPR, and the Ministry of ATR / BPN.

In this first cluster of moves, there are also ministries that support budgeting planning. The Ministry of Finance, Bappenas, and the Ministry of PANRB were also brought to IKN Nusantara.

Then state defense and security tools as well as ministries or institutions that support law enforcement also participated, namely the Headquarters of the TNI, TNI AD, TNI AU, TNI AL, Mabes Polri, Paspampres, BIN, BSSN, Kejagung, Kemenkumham, and KPK.

Meanwhile, those who got their turn in the second cluster were ministries that support the development of the IKN area, namely the Ministry of Transportation, KLHK, and the Ministry of SOEs. This cluster also includes ministries that support the implementation of basic services and human development, namely the Ministry of Religion, Ministry of Health, Ministry of Education and Culture, Ministry of Social Affairs, Ministry of Rural Affairs, Ministry ofPppa, and Ministry of Youth and Sports.

Then in the third cluster, there is a ministry that supports economic development and investment. Consisting of the Ministry of Trade, Ministry of Industry, Ministry of Cooperatives and SMEs, Ministry of Manpower, Ministry of Energy, Ministry of Energy and Mineral Resources, KKP, Ministry of Tourism and Creative Economy, and BKPM.

In the fourth cluster, it was the turn of non-ministerial government agencies. Starting from BPS, BKN, LAN, BKKBN, BNN, BNPB, BNPT, Basarnas, BIG, Bakamla, Lemhannas, Wantannas, LKPP, BRIN, and BPOM.

In the fifth cluster, namely non-structural institutions. These include KPU, Bawaslu, DKPP, PPATK, ORI, KASN, BPIP, BNPP, KIP, KKIP and DPOD.


Where are the key economic regions in Indonesia?​


Regional GDP

Gross domestic product (GDP) at market prices represents the final result of the production activity of resident producer units. Called Gross Regional Product (GRP) when applied to regions and Gross Provincial Product (GPP) when applied to provinces.

Indonesia’s regional economies

Given its archipelago nature, Indonesia’s economy is more diversified with the capital Jakarta accounting for less than 18% of total GDP. Jakarta and East Kalimantan are the two provinces with the highest GDP per capita.

Barat = West
Timur = East
Tengah = Central
Jawa = Java


Indonesia dangles lucrative Jakarta leases to entice investment in new capital Nusantara​


Nusantara is set to replace sinking and polluted Jakarta as Indonesia's political centre by late 2024. PHOTO: AFP

Wahyudi Soeriaatmadja
Indonesia Correspondent


JAKARTA - Indonesia is dangling long-term lease concessions in the prime central district in Jakarta – where ministries and government agencies are located – to private investors as a sweetener if they participate in developing Nusantara city, the future administrative capital of Indonesia.

A recent Jakarta governor regulation has revoked a 2014 law banning the private sector from using government buildings and land in such lucrative zones, according to two people who know of the plan to issue the concessions.

President Joko Widodo has been struggling to court the private sector, including foreign investors, to participate in the 466 trillion rupiah (S$40 billion) administrative capital project, of which only 20 per cent will be funded by the government. The capital will be located in East Kalimantan’s Penajam Paser Utara, about 2,000km from Jakarta.

The lease concession has been hailed by Indonesian property developers.

Mr Paulus Totok Lusida, Real Estate Indonesia chairman, said the concession offer will attract investors as the central district areas are very strategic, adjacent to the presidential palace, with nice views and greenery.

“Jakarta will remain crowded and good for business. Everywhere else when a country moved its administrative capital, the original capital city got even more crowded because it became a purely trade and metropolitan city. Look at Kuala Lumpur, which today has more crowds and jams,” Mr Totok told The Straits Times.

But he noted that there has been an oversupply of Jakarta’s office space for several years, and the coronavirus pandemic – which saw many employees working from home – has further dented demand. He forecast the oversupply will last for at least two years.

Mr Totok said the concession offered will be on a build-operate-transfer (BOT) arrangement, where investors may develop or renovate existing buildings and operate them for 20 to 30 years before returning them back to the government if no extension is requested.

Foreign investors are allowed to engage in the BOT agreement as long as they have a locally incorporated company, he added.

When contacted by ST, Ms Merry Morfosa, head of the Jakarta administration department in charge of spatial planning, declined to give details on possible concession terms, saying that they were for the national government to decide.

But she stressed: “There is no regulation now that would block transferring of state land for private use.”

In early 2022, the government said that the United Arab Emirates and Saudi Arabia were interested in investing in Nusantara, although no contract was signed.

Also, Tokyo-based SoftBank had pledged interest but later backed out. The government said it could not meet the bank’s terms.

On Monday, Malaysian Prime Minister Anwar Ibrahim said his government will take a positive approach and seek ways so that the development in Nusantara would also benefit his country, especially Sabah and Sarawak which are nearer to the proposed Indonesian capital.

Eleven letters of interest by Malaysian companies operating in sectors that include electronics, health, sewage treatment, construction and property have been signed.

Mr Widodo, who has 1½ years left to his second term as president, announced the plan to build a new administrative capital in the middle of a vast Kalimantan rainforest following the 2019 presidential polls, after his then rival Prabowo Subianto unilaterally claimed victory.

Observers noted that announcing a long-term plan like building a new capital was an elegant way for an incumbent president to assert victory as it conveyed a message that he would still be around to carry out such a long-term plan.


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