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While Jakarta sinks 25 centimeters per year, Indonesia is building a new US$32 billion capital in the Borneo jungle. Nusantara reached 80% of phase 1 in May 2026.
According to a report by NPR, the Garuda palace — the presidential headquarters shaped like a mythical eagle — is already finished. It was inaugurated in October 2024.
Indeed, legislative and judicial buildings are still under construction. The official goal is to deliver them in 2027, according to the Indonesian government.
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While Brazil’s Ferrogrão project has been stalled for 16 years, China is erecting the central tower of the world’s largest trans-sea railway bridge — 29.2 km of high-speed rail between Shanghai and Ningbo.
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According to the company, a 45 m² container house, made with three L-shaped containers, was the first project of its kind they executed, featuring special structural reinforcement and used containers.
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The flat roof of a house features a waterproofed slab, distributed drains, color-coded pipes, and hidden access to prevent leaks, facilitate maintenance, and organize solar panels, air conditioning units, and the water tank.
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WEG inaugurates an industrial paint distribution center, reinforces its presence in Latin America with high-tech anticorrosive solutions, and expands regional service capacity from Bogotá, offering greater agility and proximity to the market in Colombia.
The number of workers at the site has jumped. According to government data, between 150,000 and 200,000 people are currently working — three times more than at the start of the project in 2022.
Likewise, the planned urban area spans 2,560 km². It’s almost the size of the city of Rio de Janeiro but only accommodates administrative and residential functions.
Why Indonesia Needs to Abandon Jakarta for Nusantara
Jakarta has 11 million inhabitants in its central area. According to a study by Wikipedia, over 40% of the city is already below sea level.
Indeed, the megacity is sinking faster than any other major capital in the world. Northern areas record a drop of up to 25 cm per year.
- 11 million inhabitants in Jakarta — central area of the current capital
- 40% of the city below sea level — increasing flood risk
- 25 cm/year sinking — worst rate among global megacities
- 2,560 km² area of the new capital — almost the size of Rio de Janeiro
- US$32 billion projected — total budget in phases until 2045
As a result, the government decided to move the capital over a decade ago. The official transfer law was sanctioned in January 2022 by then-president Joko Widodo.
On the other hand, the transfer can only happen gradually. Federal civil servants are expected to migrate between 2026 and 2030.
What Makes the Nusantara Project Unique Among New Capitals
Other capitals were built from scratch — Brasília in Brazil in 1960, Naypyidaw in Myanmar in 2005. But the new capital is the first carved out of primary tropical rainforest in Asia.
According to an analysis by HKTDC, the urban design uses forest-city principles. About 70% of the area will remain with preserved original vegetation.
Indeed, wide streets with bike lanes, an electric mobility network, and renewable energy are pillars of the project. The budget foresees full integration with autonomous public transport.
Therefore, comparisons with Brasília end there. The Indonesian capital was designed for a humid equatorial tropical climate, not savanna.
Nusantara’s Budget Faces Brutal Cuts in 2026
Despite the optimism of phase 1, state funding plummeted. According to a report by Time, federal funding dropped from US$2 billion in 2024 to US$300 million in 2026.
Indeed, the drop represents an 85% reduction in just 2 years. The change in government from Joko Widodo to Prabowo Subianto brought a new budgetary priority.
On the other hand, the private sector is called upon to fill the gap. International investors were invited to roadshows in Singapore, Tokyo, and Riyadh in 2025.
As a result, the original 2045 timeline may be significantly delayed. Without substantial private capital, the current pace is unsustainable.
The Balik People and the Environmental Impact in Borneo
The Balik people have lived in East Borneo for centuries. As reported by Dezeen, indigenous communities are being displaced by the advancing construction.
Likewise, Arie Rompas, an activist with Greenpeace Indonesia, described the project as “disordered and reckless.” He states that the construction violates the rights of local communities.
According to Greenpeace, virgin forest plots were cleared without proper licensing in 2024 and 2025. Compensation for the Balik people remains under discussion.
Likewise, international NGOs are closely monitoring the case. Environmental audit documents have not yet been made public.
Indeed, the Indonesian government’s response is to argue that 70% of the vegetation cover will be preserved. Critics dispute this estimate.
On the other hand, Balik leaders want a formal guarantee of payment and dignified resettlement before phase 2 of the works proceeds.
On the other hand, Indonesian authorities affirm respect for sacred areas. The government emphasizes the preservation of 70% of the original vegetation cover.
How the New Capital Compares to Other Asian Megaprojects
The most immediate contrast is with China’s railway expansion — accelerated execution and continuous state funding.
According to Linos News, Indonesia follows a hybrid model. Initial public investment and gradual privatization of residential zones.
Indeed, countries facing similar sinking, such as what we see in the Maldives with artificial land, choose another strategy. There, the approach is to artificially raise the ground.
Likewise, Indonesia decided to move to higher ground instead of defending Jakarta. The logistics and eventual cost of keeping the city flooded were unfeasible.
Caveats and What Could Still Delay Nusantara
However, private funding needs to take off for the timeline to be maintained. Without it, phases 2 to 5 may have a reduced scope.
Despite this, the Prabowo government reaffirmed its commitment to the capital transfer. Only direct funding was reduced, not the project’s status.
However, environmental experts continue to warn of the risk of erosion of Indonesia’s Amazonian soils. Borneo has fragile soil when exposed to tropical rain.
On the other hand, local NGOs report changes in the microclimate of the construction region. The removal of vegetation cover raises the average temperature by up to 2°C.
Indeed, analogous projects in Southeast Asia have shown similar impacts. The construction of Naypyidaw in Myanmar in 2005 left visible environmental marks to this day.
Likewise, long-term success will depend on efficient forest management. Indonesian authorities claim to have a detailed plan, however, its implementation still needs to be audited.
Despite this, observers point out that the original timeline was tacitly extended. The government avoids publicly admitting delays because it would change the political narrative.
However, without robust private funding, the dream of the new capital risks remaining incomplete. The case could become another global warning about the limits of urban megaprojects.
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