JAKARTA – Back to August 2019, when President Joko Widodo first announced his intention to build a new capital city for Indonesia. The capital city would be moved from Jakarta to a forest area in Penajam, North Paser in East Kalimantan. The new city would be named IKN Nusantara.
In the future, Nusantara is expected to become a leading region to boost the economy outside Java, especially in Eastern Indonesia. Although there were many skeptical comments from the beginning, Jokowi was unmoved. The mega project continued amidst criticism, from the very expensive financing to environmental issues.
Law No. 3 of 2022 concerning the National Capital was passed by the House of Representatives (DPR) in a flash, after being discussed for only 43 days. There were not many public consultations, focus group discussions, and the like. The law established the IKN Authority Agency which is tasked with preparing, building, relocating, and managing the new capital city area.
The new law on the National Capital is in the gray area of decentralization policy in Indonesia. The leader of the Archipelago will be appointed directly by the President and there is no legislative body. This means that residents with Nusantara ID cards will not participate in regional elections to elect leaders and people's representatives there.
Not many have criticized the condition of the IKN without democracy. In fact, the election of regional heads and legislatures is one of the main characteristics of the decentralization policy, which has emerged since the democratic transition in 1998.
Semi-Authoritarian Principle
It seems strange that the DPR did not question that the IKN Nusantara would not have a regional legislative body. The council members immediately passed the National Capital Law without any objections.
In fact, there were many complaints from the surrounding indigenous communities that they were not involved in the IKN Nusantara plan. The role of the community was actually reduced by Presidential Regulation Number 62 of 2022, which was ratified on April 18, 2022.
The role of the community will later be determined through an unclear "community forum". This fact makes it difficult not to conclude that the government indeed intends to avoid public oversight of the IKN Nusantara.
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The direct appointment of the leader of the IKN Nusantara and the absence of legislators in the governance of the new capital city, shows the government's semi-authoritarian attitude. The reasons for efficiency and meritocracy are just a cover, so that the semi-authoritarian principle is not clearly visible.
Any decision-making related to the IKN will indeed be fast. However, eliminating the direct role of the community ensures that the IKN is not a city intended for all Indonesian people.
Only the political and business elite and die-hard supporters of the government will enjoy the IKN Nusantara later.
Dystopia
Urban planning expert from the University of Queensland, Australia, Dorina Pojani, wrote a book entitled Trophy Cities. The book was published during the COVID-19 pandemic in 2021. In her book, Pojani states that most new cities built after the 20th century experienced planning errors,
"Most new capital cities built after 1900 experienced major planning errors. "These cities end up being boring, overpowered, underserviced, wasteful, and overpriced," Pojani wrote in his book.
Pojani also mentioned that before the 20th century, there were only 40 capital cities in the world. However, after that the number jumped to 200 capital cities, and is still growing today.
"The scope of failure is broad. The new capital cities are more monumental spaces, rather than friendly and useful. Instead of being a shared space, the new capital cities are full of social and ethnic disparities. In short, the new capital cities are becoming dystopias, frightening places," Pojani wrote again.
Although it was reported that Jokowi involved many urban planning experts, Pojani was not included.
It cannot be concluded that the IKN Nusantara will become a dystopia, but its development does seem to be stalled. Although access to it for the media, especially foreign media, is very limited, the gaps in the irregularities in the development of the IKN are still leaking.
The resignation of the Head of the IKN Authority Agency, Bambang Susantono and his deputy Dhony Rahajoe is a sign that there are problems in the development of the prospective new capital city.
Investment Problems
The development of the Indonesian National Capital, which costs almost IDR 500 trillion, is rumored to be funded by foreign investors. The use of the state budget through the APBN is said to be very minimal. In fact, until now foreign investment is still zero.
Bloomberg in late 2022 made a report stating that not a single foreign investor has entered into an investment contract in the Indonesian National Capital.
"Not a single foreign party, either state or private, has signed a binding contract to fund the project," wrote the Bloomberg report.
In January 2020, it was reported that SoftBank Corporation from Japan was ready to provide a loan of 40 billion US dollars for the development of the Indonesian National Capital. The bank's corporate staff was brought in to explore, but returned with only a "no, thank you" statement.
Jokowi's efforts to seek a loan from Australia also failed, even though it was reported that the Kangaroo Country had funds of 3.5 trillion Australian dollars ready to be distributed. Jokowi's efforts to China, South Korea, and several European countries have also not yielded results.
"The investment that has entered the IKN now in the first phase is all PMDN investment. There has been no PMA (foreign investment) that has done a groundbreaking," said Minister of Investment/Head of BKPM, Bahlil Lahadalia in a meeting with Commission IV of the DPR on June 11, 2024.
Jokowi's visit to the United Arab Emirates in July has also not resulted in any investment for the IKN. Of the eight memorandums of understanding signed between Indonesia and the UAE, none are related to the IKN.
Meanwhile, many predict that funding for the IKN Nusantara will later be taken from Jakarta. Even though it no longer has the status of the National Capital, Jakarta will remain the center of the national economy. The management of the former capital city will be carried out by the Agglomeration Area Council, which is responsible to the Vice President of the Republic of Indonesia, Gibran Rakabuming Raka.
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