Jakarta. Indonesia sees the latest developments in the Hajj Village development as a reflection of its close links with Saudi Arabia, but this megaproject comes with what ulemas call “exclusivity risks” if Jakarta is not careful.

Indonesia recently acquired a hotel and land plots spanning 4.4 hectares in Mecca as the Southeast Asian country wants to set up a complex dedicated to its pilgrims close to the Masjid al-Haram. This $500 million conditional purchase deal makes Indonesia the first foreign entity to purchase land in Islam’s holiest city. Foreign Affairs Ministry’s spokesman Vahd Nabyl A Mulachela recently commented on the recent milestones from a diplomatic standpoint.

“It is indeed our interest to build this Hajj Village as Indonesia sends the most Hajj pilgrims globally. … [The Hajj Village] also symbolizes Indonesia-Saudi Arabia’s longstanding close ties,” Nabyl told reporters in Jakarta on Friday. 

The Indonesian Ulema Council (MUI) described the megaproject as an “innovation to the existing Hajj services”, citing that it could be helpful for the elderly pilgrims. MUI senior official Cholil Nafis, however, noted that the Hajj Village could backfire if not careful, even potentially causing exclusivity risks by providing special privileges to Indonesian pilgrims.

“A careless management will only create an exclusive [status] to the Indonesian pilgrims, which sets them apart from those coming from the other parts of the world,” Cholil said, while also warning that the money spent on setting the large Hajj complex might go to waste if not careful.

President Prabowo Subianto declared his Hajj Village ambitions in May. Saudi Crown Prince Mohammed bin Salman (MbS) agreed to the plan about two months later when the retired army general traveled to Jeddah. The leaders recently had a telephone conversation about the Hajj Village. The oil-rich kingdom’s law that regulates real estate ownership by non-Saudis will officially take effect next year.

Prabowo has appointed Danantara to be in charge of the Hajj Village project, particularly in regard to the initial investments and acquisitions. Danantara chief executive officer Rosan Roeslani recently told the press that the Hajj Village would also open its doors for non-Indonesian pilgrims. Given the size of the Hajj contingent, the facilities will prioritize Indonesians over foreigners. In the upcoming Hajj season, Indonesia will send up to 221,000 pilgrims, the largest quota for a foreign country. As many as 2 million Indonesians go on the minor pilgrimage of Umrah each year.

On top of the $500 million acquisition, Indonesia is planning to invest up to $800 million to construct 13 towers and a shopping center on the freshly bought 4.4-hectare land to increase the room capacity. 

Indonesia is bidding for a separate land plot located 2.5 kilometers away from the Masjid al-Haram. Jakarta is competing against 90 bidders, but is among the top 2 contenders, according to Rosan. The winner announcement is slated for no later than January. The bidded land has a fixed price tag of $750 million, thereby bringing the expected investments so far to around $2 billion.