Ibu Kota Nusantara: 3 transportation projects continue to be accelerated

  • 06 Jun 2024

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 - Ibu Kota Nusantara: 3 proyek transportasi tetap dikebut

6 June 2024

By Lorenzo A. Mahardhika and Ni Luh Anggela

Bisnis, Jakarta – The Transportation Ministry remains optimistic about the continuation of three transportation projects in Nusantara, despite the recent resignation of two officials from Nusantara Capital City (IKN) Authority (OIKN).

Transportation Minister Budi Karya Sumadi said that the three projects were the Nusantara VVIP airport, an autonomous rail transit system, and electric public transportation provision.

According to him, the development of transportation infrastructure in IKN will remain optimal.

Budi Karya also explained that transportation infrastructure projects in IKN would continue. He believes the change in the OIKN Head and Deputy Head will not hinder their progress.

Bambang Susantono and Donny Rahajoe have officially resigned as the OIKN Head and Deputy Head. The position of Bambang as OIKN Head has been replaced by Public Works and Housing (PUPR) Minister Basuki Hadimuljono as Acting Head. Meanwhile, the position of Donny has been filled by Agrarian Affairs and Spatial Planning Vice Minister Juli Antoni.

“I think Basuki has the capacity to complete projects [in IKN],” he said at a work meeting with House of Representatives (DPR) Commission V at the parliamentary complex in Jakarta on Wednesday (5/6).

Currently, the Transportation Minister stated that one of the transportation projects accelerated was the VVIP airport. Budi Karya said that the construction progress of the VVIP airport has reached around 50%.

The VVIP airport will have a runway spanning 3,000 metres, capable of accommodating Boeing B777 aircraft.

Budi Karya said that he submitted a proposal to President Joko Widodo (Jokowi) titled Nusantara. However, Budi Karya cannot ensure if this name will be used for the VVIP airport.

The autonomous rail transit (ART) system project has also been greenlighted by Jokowi. Budi Karya is targeting to conduct a trial run for the ART system on 17 August 2024. “However, only one trainset will operate as there will be a tender later,” he stated.

The next project is electric vehicle procurement. He said that electric vehicles would be used for public transportation as well as official vehicles for officials working in IKN.

A spokesperson for the Transportation Ministry, Adita Irawati, added that transportation infrastructure development in IKN would continue. “All projects in IKN are still in progress and proceeding as planned,” Adita stated.

She said that the construction of the VVIP airport in IKN would continue for both the airside and landside. She said that the construction of the airside was carried out by the PUPR Ministry, while the construction of the landside, including terminals, is carried out by the Transportation Ministry.

She continued that the Transportation Ministry has coordinated with IKN Authority Facilities and Infrastructure Deputy Silvia Halim regarding the ART system trial run commencing in August 2024.

The ART system trial run can be carried out after the completion of the west side of Jalan Sumbu Kebangsaan in Central Government Core Area (KIPP) in IKN by the PUPR Ministry.

The Transportation Ministry is planning to purchase three trainsets from China for the ART system in IKN.

Railways Director General of the Transportation Ministry Risal Wasal said that each trainset comprised of three carriages, with Indonesia planning to purchase nine carriages in total. However, he is reluctant about mentioning the cost required to implement the plan. “In the initial phase of the ART system, we will purchase three trainsets from China,” Risal said.

During the occasion, Budi Karya disclosed that the Transportation Ministry has proposed an indicative budget ceiling of Rp24.76 trillion for 2025, marking a 35.85% decrease compared to the budget allocation in 2024.

Budi Karya said that several programmes accommodated in the indicative budget ceiling included the implementation of urban mass transportation in Medan and Bandung, availability payments for Makassar-Parepare Railway, support for IKN, and the development of National Tourism Strategic Areas (KSPNs).

BTN in Nusantara

In Nusantara, the President is conducting the sixth series of groundbreaking ceremonies, which includes a project by PT Bank Tabungan Negara (Persero) Tbk in IKN.

Jokowi appreciates BTN’s step to establish an office in IKN. Their reason is the significant need for investment financing in the property sector there.

BTN will join the list of bank state-owned enterprises (SOEs) in IKN that have carried out a groundbreaking ceremony. The President hopes the economic transformation from IKN development can be achieved on schedule.

“The crucial aspect is ensuring that the economic transformation we aim for through the development of Nusantara Capital City is achieved according to schedule,” Jokowi stated.

Bank BTN President Director Nixon L.P Napitupulu stated that the construction of BTN’s office was set to be completed at the end of 2025.

“We are expecting it to be completed at the end of 2025. Hopefully it can be completed,” Nixon said to the media.

Nixon revealed that the construction of the project on 9,000 square metres of land amounted to around Rp113 billion, including the land and building. He is targeting the building to operate in 2026 at the latest.

During the occasion, BTN also signed a memorandum of understanding with IKN Authority. This cooperation covers potential cooperation in the development of a housing financing programme for both landed houses and flats in IKN, as well as potential collaboration in the development of financing programmes for non-housing and other banking services in IKN.

“The presence of BTN in IKN is expected to bolster mortgage agreements, given that most housing developers in East Kalimantan have already cooperated with BTN,” he stated.

BTN is the last bank SOE to conduct a groundbreaking ceremony in IKN.

On Tuesday (4/6), the President inaugurated a groundbreaking ceremony for Astra Biz Centre and Nusantara Botanical Garden in IKN.

During the inauguration, the President stated that investing in IKN was an investment in a future that will would yield abundant results.

IKN will be increasingly more expensive after all investments in IKN have yielded abundant results. IKN will be more expensive after all infrastructure projects have operated, including toll roads, ports, and airports.

The toll road connecting Balikpapan-IKN will be completed soon. When the toll road is opened, traveling between Balikpapan and IKN spanning 57 kilometres will only require 50 minutes, not 2 hours.

At the same time, Jokowi also inaugurated the groundbreaking ceremony for the international doctorate programme campus of Universitas Gunadarma in IKN worth Rp75 billion.

Universitas Gunadarma’s international doctorate programme campus will cooperate with numerous international universities in France, Slovakia, and Sweden.

Besides inaugurating the groundbreaking ceremonies for the three projects in Nusantara, the President also inaugurated Sepaku Semoi Dam in Tengin Baru Village, Sepaku Subdistrict, North Penajam Paser, East Kalimantan.

Sepaku Semoi Dam is vital as it is a source of raw water and drinking water in IKN and its vicinity.

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