Government Immediately Completes Incentive Design For Private Investors In IKN

Head of the Archipelago Capital Authority (IKN) Bambang Susantono. ANTARA/HO-Secretpres Press Bureau/Muchlis Jr/aa.

JAKARTA - The government is preparing an incentive scheme, both fiscal and non-fiscal, to attract funding for infrastructure development in the National Capital City (IKN) of the Archipelago, East Kalimantan.

"The incentives prepared must attract investors, but of course they must not violate the applicable provisions," said the Communication and Information Coordinator of the Nusantara IKN Transition Team, Sidik Pramono, quoted by Antara, Friday, June 17.

Sidik did not disclose the incentive scheme. He said the government would soon finalize a draft regulation on the incentives and announce it to the public.

"There are many incentives, I can't mention them yet. Hopefully they will be issued in the near future," he said.

In addition to finalizing regulations regarding incentives, said Sidik, currently the Head of the IKN Authority, Bambang Susantono and the Deputy Head of the IKN Authority, Dhony Rahajoe, are currently intensively meeting potential investors for the development of the archipelago.

Bambang at the World Economic Forum (WEF) in Davos, Switzerland, in May 2022, also intensively promoted IKN Nusantara to leaders of global companies.

"A number of potential investors from various countries, from various business fields, have expressed their interest in contributing to IKN development," he said.

Sidik said the IKN Transition Team is optimistic that many foreign investors or private companies will be interested in funding the IKN development because of the smart, sustainable and green city concepts that will be built at IKN.

"With a good IKN concept like that, and also the seriousness of the government, it will attract many investors to IKN," he said.

The Minister of National Development Planning/Head of Bappenas, Suharso Monoarfa, previously said that the government is currently preparing the guidelines needed by investors to participate in investing in IKN, including incentives and disincentives.

"They will definitely ask what the guidelines are like. So, let us direct the President more firmly. So, the President has directed us and in the next two weeks, hopefully all the regulations will be completed," said Suharso, Monday (13). /6).

The government targets to start physical development at IKN Nusantara in semester II-2022. The IKN development is divided into three stages, of which the first stage is the development of core infrastructure, including the Presidential Palace, MPR/DPR Building, government offices, TNI-Polri headquarters, and housing until 2024.

Meanwhile, the second phase of IKN development will be carried out in 2025-2035 and the third phase in 2035-2045.

In total, the government needs a budget of IDR 466 trillion to build IKN Nusantara. Of the total budget of Rp466 trillion, the government plans for 19-20 percent of the APBN, while the rest will come from investment and partnerships with the private sector.