East Kalimantan development direction: Adaptively welcoming Nusantara Capital City

  • 20 May 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 - Arah pembangunan Kaltim: Adaptif sambut IKN Nusantara

20 May 2024

By M. Mutawallie Syarawie

All stakeholders in East Kalimantan must organise to welcome Nusantara Capital City (IKN) in the third quarter of 2024. Numerous efforts must be carried out to optimise the role of East Kalimantan in sustaining the new capital city.

East Kalimantan is entering a new stage as it faces upcoming changes following the construction of IKN.

The province that is also known as Benua Etam needs to carry out numerous transformations to optimise the opportunities from IKN.

East Kalimantan Chamber of Commerce and Industry (Kadin) Chairperson Dayang Donna Faroek emphasised the importance of adaptation and preparation, particularly for Balikpapan and North Penajam Paser Regency that will directly interface with IKN.

He explained that the impact of IKN development would be expansive. For example, housing for 3 million people is forecasted to be required in Balikpapan.

“It must be determined which region will be made as a housing area. So, business players can prepare themselves,” he said in his official statement last week.

Therefore, he suggests revising the regional spatial planning (RTRW) to be smartly prepared by taking into account development areas and green open spaces.

“The most important thing is to reorganise road segments to reduce traffic congestion. Additionally, a housing area needs to be mapped out to accommodate a surge of newcomers, which could otherwise lead to traffic congestion and a housing deficit,” he explained.

Dayang revealed that business players in East Kalimantan were also preparing themselves to adapt to the changes.

“We need clarity on the areas designated for commercial purposes, such as residential zones, shipping centres, agricultural areas, schools, and other commercial-related spaces,” he stated.

With appropriate preparations and strategies, he added that East Kalimantan was expected to be ready to face challenges and seize opportunities presented by Nusantara development.

“As previously mentioned, Balikpapan and North Penajam Paser will directly interface with IKN, requiring both regions to make adjustments. In the future, Kutai Kertanegara may also need to adapt, especially in subdistricts along the coast,” he added.

Meanwhile, Balikpapan Local Government has initiated discussions to revise the RTRW for 2023/2043.

Acting Balikapan Land and Spatial Planning Agency Head Muhammad Farid Rizal stated that his agency has completed an important stage, which includes recommending the basic map and validating the strategic environmental assessment (KLHS).

“We are currently completing the administrative requirements, which include the spatial planning forum discussion and public consultation,” he stated.

He added that the RTRW revision also involved coordination with the IKN Authority and discussions with Balikpapan Regional Legislative Council (DPRD).

“The end result will be a regional regulation that addresses the RTRW of Balikpapan,” he stated.

He mentioned that the RTRW was revised every five years to adapt to evolving development dynamics, including new policies and requirements resulting from population growth and infrastructure expansion.

“For example, with the establishment of IKN in East Kalimantan, several changes and adjustments will be necessary. A five-year evaluation is appropriate to assess these developments,” he explained.

Based on the KLHS, Balikpapan Local Government is committed to developing a city that is not only continuously growing but also environmentally friendly through the ongoing revision of the RTRW.

“We will continue to adapt and innovate in accordance with our analysis. We will also establish an intersectoral collaboration with the Agrarian and Spatial Planning Ministry/National Land Agency (ATR/BPN),” he explained.

Traffic

On the other hand, Planosentris Urban Study Centre Director Farid Nurrahman highlighted major and crucial activities in the city that have led to increased traffic, resulting in continuous congestion and suffocation of the city.

According to him, Balikpapan Local Government must conduct a scientific analysis on the trend of vehicle increase over the last five years as a basis for effective planning.

“The increase in the number of roads in Balikpapan is still insufficient. It is important to see road connectivity as vehicle growth always surpass road growth,” he stated.

He explained that it was essential to implement traffic engineering based on passenger movement triggers and establish collaborations with the private sector, such as with Pertamina to manage traffic flow in refinery areas.

Farid said that relocating industrial estates to North Balikpapan and constructing toll roads were productive steps.

However, he added that there was still a requirement to prepare long-term alternative routes.

“Regarding long-term alternative routes, Balikpapan can learn from other major cities, such as Jakarta that has constructed a toll road in the city, Surabaya that has constructed an outer route, and Yogyakarta that has constructed a ring road,” he explained.

He hopes that Balikpapan Local Government will align its regulations with the national plan to prepare new routes and revise the RTRW, strengthened with comprehensive planning.

Meanwhile, Balikpapan Transportation Agency is currently preparing new regulations and urban transportation routes to sustain IKN.

Balikpapan Transportation Agency Head Adwar Skenda Putera emphasised that the city needed adaptive transportation regulations to support its role as the main gateway to IKN in East Kalimantan.

“Balikpapan has become one of the cities partnering with IKN. Therefore, the city must be organised, including its urban transportation,” he explained last weekend.

He is planning to introduce new routes that will integrate urban transportation with housing and residential areas, similar to the system in Jakarta.

According to him, in the future, major roads will be designated for mass transportation to minimise conflicts between different modes of transportation.

Besides that, his agency is also planning to add more facilities to Semayang Port to support mass transportation.

Regarding this matter, his agency has issued a circular letter to prevent conflicts between online drivers and urban transportation.

“So, please adhere to the regulations in the city. You may enter, but do not act as you please,” he said.

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