WhereIsAtlas · Cities

What Happened to Nusantara, Indonesia's $32B Jungle Capital?

Indonesia decided to move its capital from a sinking Jakarta into the Borneo jungle. A $32 billion bet that is now a partly-built, deeply contested city.

Moving a capital was a legitimate idea for a sinking Jakarta, but the $32 billion rainforest mega-project has been undercut by environmental cost, delays and politics - a reminder that even the grandest national project has to survive the ground it was built on.

A capital in the jungle

Few countries have ever tried to build a brand-new capital from scratch in the middle of a rainforest. That is exactly what Indonesia announced in 2019: Nusantara, a planned city in East Kalimantan on the island of Borneo, intended to replace a Jakarta that is crowded, congested and literally sinking into the sea.

The price tag was enormous - around $32 billion - and the ambition even larger: move the center of a 270-million-person nation into the jungle. The story of what happened next is one of monumental vision colliding with rainforests, budgets and politics.

Why Jakarta had to go

Jakarta has a genuinely existential problem: it is sinking, in places by many centimeters a year, while sea levels rise. Parts of the city sit below sea level, and it floods with growing regularity. Add crushing congestion and the issue of an ever-growing megacity, and the case for a new capital was easy to argue.

The idea of moving the capital has historic roots - it dates back to Indonesia's first president, Soekarno, in the 1940s. But it took the sinking crisis to push it into action.

The $32 billion plan

Indonesia formalized the move with a 2022 law and broke ground on Nusantara in East Kalimantan. The blueprint was a 'green' smart city carved out of the forest, with government offices, homes and infrastructure designed to house a capital while looking nothing like sprawling Jakarta.

The cost, projected at around $32 billion, was to come from state money, private investment and public-private partnerships. The site was chosen for being central, earthquake-safe and far from the sinking coast.

The forest, the cost and the critics

But the jungle fights back. Clearing rainforest for a capital drew sharp criticism from environmentalists, and the clearing of a landscape that many indigenous communities call home became a flashpoint. Costs ballooned and the distance between the stated ambition and the reality on the ground widened.

There was also political pushback - a sense that a nation still grappling with basic infrastructure should not be pouring tens of billions into a vanity capital in the woods.

A slow, contested opening

To prove the project was real, Indonesia held part of its Independence Day ceremony at Nusantara in August 2024. But occupancy lagged far behind the plan, with officials and civil servants slow to relocate, and the city looked more like a construction site than a working capital.

President Prabowo publicly reaffirmed his commitment on a January 2026 visit, yet progress remains far behind schedule and the controversy has not gone away.

Where does it end?

Nusantara today is a genuine either/or: a bold nation-building project that is partly built and running years late, or an expensive cautionary tale about building a city in a rainforest amid a budget crunch. Even its defenders concede it is far from done.

The honest answer to 'what happened to Nusantara?' is that it is happening - slowly, expensively and under a cloud. Whether it becomes Jakarta's successor or a monumental what-if is still being written.

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