Development Planning Ministry: Capital City Relocation to Cost Rp323 – 466 Trillion

President Joko Widodo accompanied by Vice President Jusuf Kalla leads a Limited Meeting on the Follow-up of the Plan to Move Capital City, at the Presidential Office, Jakarta, Monday (29/4). (Photo by: Jay/ PR)

Ministry of National Development Planning (PPN)/the National Development Planning Agency (Bappenas) has projected that the State needs Rp323 to 466 trillion to relocate its capital city from Jakarta to a city outside Java Island.

Minister of PPN/Head of Bappenas Bambang Brodjonegoro asserted that based on the first scheme in which all state civil apparatus of the Central Government recorded in the 2017 database to be relocated to the new capital city, the population in the new capital city will be 1.5 million people consisting of executive, legislative, and judicial members, members of the Indonesian National Police (Polri), members of the Indonesian National Defense Forces (TNI), along with their families.

“The 1.5 million people shall need 40,000 hectares of land in which 5 percent of it will be used for space, 15 percent for economy, 20 percent for infrastructure distribution, 40 percent for settlement, and 20 percent for green open space,” Bambang said.

In the second scheme, if the number of state apparatus to be relocated is resized to around 111,000 people, adding the members of TNI and Polri, along with their families, and 184,000 economic players, the total population of the new capital city will be 870,000, that means it will need 30,000 hectares of land.

“With that consideration, the first scheme is predicted to cost nearly Rp466 trillion or US$33 billion, while the second scheme will require less money, at around Rp323 trillion or US$23 billion,” Bambang explained.

According to the Minister, there are four financing sources of this plan, among others; from the State Budget particularly in developing initial infrastructure and facilities of government offices and the House of Representatives, from the State-owned Enterprises in developing public infrastructures and social facilities, from the Government and Business Entities Cooperation (KPBU) in developing several social facilities, and from private sectors in developing housings and commercial facilities.

The Minister went on to say that the Government will need Rp250 trillion to develop the city based on the first scheme, meanwhile private sector needs Rp215 trillion. In the second scheme, the Government will also disburse more money than private sector for the development.

Bambang added that in manifesting the plan of relocating the capital city, there will be an authority body that is directly responsible to the President. The body will also manage the development investment fund of the new city, and cooperate with the State-owned Enterprises and private sector.

“The authority body will manage investment assets and lease those assets to Government institutions or third parties, and manage the process of transferring the Government assets from Jakarta, fund investment development of the new city, as well as prepare and develop the city, including designing spatial patterns, constructing infrastructure and government facilities, monitoring the process of building infrastructure, and managing and maintaining buildings and other public facilities,” Bambang concluded.(FID/JAY/ES)

Translated by : Rany Anjany Subachrum
Edited by : Muhardi/ Yuyu Mulyani