East Kalimantan
New capital Nusantara (IKN) rising on $30.3B investment—Independence Day 2024 celebrated here; 6.2% growth from coal/palm oil, indigenous displacement concerns.
On August 17, 2024, Indonesia celebrated Independence Day in a city that didn't exist four years earlier. Nusantara—the new capital rising from East Kalimantan's forests—represents a $30.3 billion bet that Indonesia's future lies outside sinking Jakarta. President Prabowo allocated Rp 48.8 trillion for Phase 2 and ordered 1,700-4,100 civil servants to relocate by 2025. By 2028, Nusantara should function as the political capital; by 2045, the full 256,000-hectare development should be complete.
The province is already rich. Coal and palm oil powered 6.2% GDP growth in 2023, enriching Jakarta-linked elites while leaving indigenous communities with dispossession and ecological damage. The IKN project promises transformation—a smart, sustainable forest city—but critics see repetition: another megaproject displacing local peoples without genuine participation. The apparent slowdown under Prabowo may paradoxically give communities time to organize land protections.
By 2026, the pace of IKN development will reveal whether Indonesia is building a capital or a monument. If investment flows and bureaucracies relocate, East Kalimantan becomes the archipelago's administrative heart. If private funding falls short—80% of the $30 billion was supposed to come from private sources—Nusantara joins the long list of ambitious Southeast Asian projects that never quite materialized. The forest has time; Jakarta doesn't.