The presidential palace is supposed to resemble a garuda—a giant mythical eagle—when finished. For now, however, the form remains vague, the half-finished shell of the building still encased by cranes and scaffolding. Drive up onto a ridge that overlooks the city, and you see blobs of construction connected by dirt roads but otherwise adrift in a sea of green eucalyptus, on what was until recently a pulp and paper plantation.
Welcome to Indonesia’s new capital—Nusantara—which is supposed to be inaugurated on Aug. 17, the country’s independence day.
President Joko Widodo, known as Jokowi, announced plans for it just five years ago, shortly after securing a second term, and seems keen to create facts on the ground before he leaves office. Like all new capitals, it is being billed as a symbol of national unity and the future. Official cant proclaims it a “smart forest city”—a futuristic green abode of artificial intelligence, clean energy, and flying taxis, unlike the crowded and polluted current capital, Jakarta.
Whether aspirations can live up to reality is questionable. Private investment is supposed to provide 80 percent of the some $30 billion in funding needed. So far, the government has invested around $3.4 billion and the private sector $2.5 billion, according to officials. In early June, Bambang Susantono, the head of the Nusantara Capital City Authority, and his deputy, Dhony Rahajoe, both resigned, suggesting government dissatisfaction with the pace of the project.
When I visited in mid-May, it wasn’t just the palace that looked distinctly half-finished. Officials showed off concrete skeletons, confidently declaring that they would be fully functioning hospitals by August. A thick pall of dust hung over everything, stirred up by the trucks that rolled along the construction site’s dirt roads. The project has also been hit by accusations of environmental destruction and of grabbing Indigenous land.
Located in the Bornean province of East Kalimantan, Nusantara will be far from traditional centers of power in Java but in an area already heavily marked by development. Nearby is the busy oil port of Balikpapan, the provincial capital of Samarinda, and hundreds of thousands of hectares of monocrop plantations. Nusantara’s urban core is being built on a huge eucalyptus plantation.
The environment has been transformed by decades of felling, planting, and associated forest fires. “This was already a disaster area,” said Willie Smits, an environmental consultant for the capital authority.
“Renewing the relationship between man and nature, that’s the narrative that we propose,” said Sibarani Sofian, the Indonesian architect behind the masterplan for the city’s core urban area. Government plans mandate that 65 percent of the 260,000 hectares controlled by the capital authority be forested. The city is supposed to be zero-carbon by 2045, 15 years before Indonesia’s national goal of 2060.
The urban core itself will be wrapped around “green fingers.” Making use of the bumpy terrain, construction will only take place at a certain band of elevation, leaving green spaces above and below. This, Sibarani explained, will allow wind and water to circulate freely as well as guarding against the kinds of catastrophic floods that recently hit Dubai. The effect should be islands of apartments connected by walkable green pathways and public transport that are supposed to account for 80 percent of travel.
Yet, Sibarani said, it can be tricky reconciling ecomodernist ideas with politicians’ understanding of development. The insertion of a huge road running to and from the presidential palace, reportedly inspired by Jokowi’s visit to Moscow, is a case in point. “In Indonesia, as a developing country, when you have a city that has a big road, that is equal to modernization,” Sibarani said.
Environmental promises look shaky when scrutinized. Can the city really generate all its power from zero-carbon sources by 2030, as is stated in its net-zero plan? No, said Pungky Widiaryanto, the director of forestry and water resources for Nusantara. A solar power plant is being built, but the city is also being plugged into the coal-heavy regional electricity grid.
Hitting the goal of having 65 percent of the area covered by forest will also mean a massive program to reforest 120,000 hectares currently given to agriculture, mining, or plantations. Prior to the announcement, the area now under the capital authority’s control was losing about 4,000 hectares of primary forest every year. Now, Pungky said, this is down to 1,000 hectares per year with plans for a total end by 2030.
Data from Global Forest Watch suggests that the rate at which humid primary forest is being lost has declined sharply in the two regencies—midsize administrative districts—that the capital area overlaps with. These declines in the rate of loss have been markedly larger than declines at a national and provincial level. Still, Pungky said, reforesting will be an extremely complex job.
Fathur Roziqin Fen, the regional director of the Indonesian environmental NGO Walhi, is deeply skeptical about these environmental promises. Dust is thick in the air around the construction site, painting trees gray and creating lung problems for locals. Clay exposed by digging is washing into mangroves and silting up Balikpapan Bay.
A toll road from Balikpapan to Nusantara has cut through a protected mangrove that shelters orangutans, proboscis monkeys, and sun bears. “How can they make future commitments when they’re committing violations now?” Fathur said.
In Balikpapan Bay, Mappaselle, formerly a fisherman who moved from Sulawesi and now heads a local environmental NGO, pointed out areas of mangrove along the borders of the capital city that have been cleared by companies and land speculators. He said the trend started after the new capital was announced and that many of the figures laying claim to the areas are politically connected.
Tens of thousands of people already live in the new capital area. More seem likely to arrive. Part of the chaos of Jakarta today is the ongoing breakneck urbanization and poverty that prompt new arrivals to throw up houses, shops, and entire neighborhoods on unoccupied land.
Stopping a similar dynamic in Nusantara will mean keeping people out—or clearing them off. In early March, nine locals were arrested for resisting orders to abandon land they had farmed to make way for a VVIP airport that will serve the new capital.
“It’s a dilemma for us,” said Pungky, discussing relocating people. “They always say the government is very cruel, the government is not accommodating us.” He added that they are trying to resolve the issues through dialogue and education. And if that doesn’t work? “Then we do law enforcement.”
One official, speaking on background, worried that the recent resignation of the officials leading the project might herald a harder line on land conflicts. The new head of the project, Basuki Hadimuljono, who is Indonesia’s minister of public works and public housing, has singled out land acquisition as an area that he plans to make rapid progress.
Reporting has framed land conflicts as a clash between Indigenous groups and developers. But decades of migration has created an ethnic mix. In 2010, Javanese were the single-biggest ethnic group in East Kalimantan, mixed with groups from Sulawesi, a legacy of government-sponsored programs to resettle inhabitants of crowded islands.
Smits is vocally skeptical about many of the groups claiming land rights around the capital area. “It’s really the Wild West. People, they come up with groups, say we are adat [traditional community] and put up signboards saying this is traditional land—which is basically bullshit because there was nobody here,” he said. “Everybody is trying to get a piece of the pie.”
Land ownership is always a tricky business in Indonesia. The constitution puts unclaimed land at the disposition of the state, and much of the land in the area has been let out as concessions to companies. Locals can use historic residence of an area to make their own claims. But the process is often time-consuming, unpredictable, and subject to local political pressures.
Locals say compensation is quite generous if you can prove title, though disbursement can be slow. Those who cannot prove ownership—with 2,086 hectares in the capital area still having “unclear” status—have more problems. Members of Indigenous groups get the short end of the stick. “The majority of Indigenous people here don’t have legal standing, although they’ve inherited the land for hundreds of years,” said Pandi, a leader of the local Balik group that gives its name to Balikpapan.
In the late 2010s, many Balik began the slow process of trying to formally register their claims, but this was not completed by the time the new capital was announced. Now all new claims have to be approved by the capital authority. Pandi and others are still waiting. Ironically, Pandi said, more recent migrants who arrived as part of government programs are more likely to have proper documentation.
The injustice is felt sharply. “Before there was company here, before there was country here, there was already a village here,” said Arman, a local Balik man who works with an Indigenous rights group. Moves that limit access to forest areas in the name of conservation also seem little more than a cover for business for him, who said locals face strict laws on exploiting forest resources while companies freely exploit the land on a massive scale
In other cases, claims to indigeneity are at least partly a legal tactic. The village of Telemow was formally incorporated in 2010 on plantation land. Legal skirmishing began in 2017 when the company that owned the land sent documents asking locals to acknowledge they were on company land. In 2020, the company reported 27 residents to the police, accusing them of using the land without permission, an escalation that village head Mohamed Munif sees as linked to the announcement of the capital project.
Telemow inhabitants are pushing back and claiming rights to the land based on past inhabitation, arguing that the local Paser Indigenous group has long used the land. However, Munif admitted that while some inhabitants were Paser, the village was ethnically mixed, with residents from all over Indonesia. He himself moved from Java in 2012 to escape “problems and debts” and now runs a computer and digital printing business.
Munif said there are some cases of the sorts Smits describes but usually people originate from and have a history in the area from their grandparents: “There’s a lot of land here that their grandparents didn’t properly take of administratively. But when [the capital area] got announced, they returned to take care of it. There are people who really are victims.”
As some locals take advantage of the project, others are left behind. Twenty-year-old Tanto has started a business printing plastic banners displayed around the construction site. Others cater for workers. But internal statistics seen by Foreign Policy show that of the 15,092 employees of the capital authority, just 2,693 were locals. Locals consider the wages offered too low to be worth their while, said Ivan Wowiling, the pastor of a local Pentecostal church. The daily wage for a construction worker is around 150,000 rupiah, a little over $9.
Tanto said the local community is split 50-50, with older people more skeptical. Arman is one of them. He said even the road being built through his neighborhood, part of the push to upgrade local infrastructure tied to the capital project, is a mixed blessing. “We have lots of small kids here. But once the big road is done, traffic will come speeding through to the capital.” He gestured around. “So when people talk about development, you have to ask, who is it for? Who is it benefiting?”
