National Strategic Projects: Government proposes additional IKN budget
This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.
Bisnis Indonesia - Proyek Strategis Nasional: Pemerintah usul tambahan anggaran IKN
4 December 2024
By Alifian Asmaaysi and Artha Adventy
Bisnis, Jakarta – The Ministry of Public Works is continuing the development of basic infrastructure projects in the new capital city, Nusantara, by proposing an additional budget for 2025.
Public Works Minister Dody Hanggodo stated that this plan is outlined in a proposal to increase the budget by Rp60.6 trillion for the 2025 fiscal year.
Dody explained that part of the additional budget will be allocated to support the development of the new capital city, Nusantara, and the new autonomous region of Papua.
"For 2025, we intend to propose an addition of around Rp60.6 trillion, primarily to support the development of Nusantara and Papua, due to the expansion of the provinces there," he said during a working meeting with Commission V of the House of Representatives in Jakarta on Tuesday (3/12).
In his presentation, he explained that the Ministry of Public Works is proposing an additional Rp14.87 trillion to support the development of IKN Nusantara.
A budget of Rp9.9 trillion will be allocated to support the construction of roads within the Government Core Area (KIPP), the construction of the IKN Access Toll Road, and the duplication of the Pulau Balan Short Span Bridge II.
Additionally, Rp4.96 trillion will be allocated to complete the construction of the Drinking Water Supply Systems (SPAMs), sanitation, government office buildings, and office buildings for the Defence Ministry, Police, and the National Intelligence Agency in IKN.
Specifically, support for the new autonomous region of Papua is budgeted at Rp4 trillion. Of this, Rp845 billion will be used for the construction of national roads and access roads, while Rp3.15 trillion is planned for the construction of DPRD, MPR, and Governor buildings.
Additionally, the extra budget will be used for the implementation of presidential instructions (Inpres) amounting to Rp28.55 trillion. This allocation will be used for the realisation of Inpres aimed at expediting the provision of irrigation systems to support national food self-sufficiency, with an amount of Rp7.36 trillion.
Further support for the execution of Inpres will also be allocated to the implementation of the Inpres on Regional Roads, amounting to Rp15.07 trillion, and the Inpres on accelerating water supply and domestic wastewater management services, totalling Rp118.43 billion.
Lastly, Rp13.18 trillion will be allocated for other strategic activities, including the construction of toll roads, SPAMs, sanitation, and dams.
The Expert Staff to the Minister of Public Works for Technology, Industry, and Environment, Endra S. Atmawidjaja, stated that the development of IKN is part of 53 agendas supporting the flagship programmes of other ministries and agencies. "This is included in the Ministry of Public Works' quick wins for 2024-2025," he said recently.
In the presentation shared, the IKN development programme includes eight main agendas to be constructed. These include the completion of the presidential office, the IKN toll road segment from KKT Kariangau to Simpang Tempadung, and the construction of the Ministry of State Secretariat office. Additionally, there are plans for offices for Coordinating Ministries 1, 3, and 4, as well as an integrated waste treatment site in the Government Core Area (KIPP) of IKN and the IKN toll road segment from Sp Tempadung to Pulau Balang Bridge.
The Coordinating Minister for Infrastructure and Regional Development, Agus Harimurti Yudhoyono (AHY), stated that President Prabowo is indeed aiming for the construction of the KIPP within IKN to be completed within 4 to 5 years.
"The target for the next 4-5 years is for it to fully function as the new centre of government. This is what President Prabowo hopes for," he asserted.
In this initial stage, AHY mentioned that Prabowo's government will accelerate the construction of IKN infrastructure as a centre for the legislature and judiciary. Additionally, there will be accelerated support for the development of the IKN ecosystem to ensure it is accommodating for officials and civil servants (ASN) who will begin working there.
"Not only will the construction of offices be accelerated, but also the supporting housing facilities must be prepared for the civil servants and residents who will manage and operate IKN in the future," he emphasised.
Airport readiness
Transportation Ministry Spokesperson Elba Damahuri mentioned that the operation of Nusantara Airport in IKN is still pending the readiness of the Nusantara Capital City Authority (OIKN).
Currently, Nusantara Airport in IKN can be used for VVIP guests of OIKN. However, transforming it into a commercial airport will require a lengthy process, taking at least two years.
"It is ready to operate and can be used for the VVIP guests of the Authority. We just need to wait for the readiness of the OIKN," Elba said.
Transportation Deputy Minister Suntana stated that the adjustment of the status of Nusantara Airport will depend on the development of the community's dynamics. He mentioned that the airport was originally planned to serve domestic flights, but it has evolved to include international flights as well.
"It is dynamic and situational. An airport develops from serving passengers to handling cargo and other services. We need to observe how this evolves over the next one or two years," Suntana stated.
Nusantara Airport in IKN has received the code WALK from the International Civil Aviation Organisation (ICAO).
According to data from the Air Transportation Directorate General, the IKN airport, named Nusantara International Airport, is open to the public.
The airport is intended for domestic flights. The data also indicates that the airport has a 3C specification for its airport service unit. It is operated by the Air Transportation Directorate General.
In contrast, the Housing and Settlements Ministry has stated that 30 housing towers for civil servants in Nusantara will be completed this year.
Housing and Settlements Ministry Director General Iwan Suprijanto explained that the 30 towers will become operational this year.
"There are 30 towers being completed this year," he explained at Babakan Karet Permanent Housing III in Cianjur on Thursday (21/11).
The construction of the civil servant housing towers has been delayed from the initial target. The government initially aimed to complete 47 towers in IKN by 2024.
Iwan explained that the construction did not go according to plan due to the preparation for the implementation of the 79th Indonesian Independence Day ceremony in IKN on 17 August 2024.
"They will operate on a functional basis this year, but 47 towers should have been completed. This is because construction and other activities were delayed," he added.
In detail, in 2025, the Housing and Settlements Ministry will continue construction with an additional 21 housing towers for civil servants and defence and security officers in IKN.
"Next year, there will be four more towers for the Indonesian National Armed Forces (TNI) from the initially planned 17 towers. So, the contract has been increased to 51 towers for civil servants and defence and security officers," he added.
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