Jakarta. President Joko “Jokowi” defended his decision to build an entirely new capital during a historic cabinet meeting on Monday, saying that the move could spread economic activities from Java.

For the first time in history, the government held a cabinet meeting at the new capital Nusantara, locally known as Ibu Kota Negara or IKN. As Jokowi and his ministers gathered indoors at the Garuda Palace to discuss strategic matters, many of the city’s projects outside were still under construction.

Jokowi started the cabinet meeting by saying that not many countries could build a city from scratch. Indonesia is trying to move its capital from the crowded Jakarta to Nusantara. Jokowi is hoping that this capital relocation can help spur inclusive growth in the archipelagic Indonesia. Economic activities have been heavily concentrated on Java island, and Jokowi wants this to change.

“I’m pretty sure the [new capital Nusantara] can drive economic growth for East Kalimantan, specifically Balikpapan and the regency of North Penajam Paser,” Jokowi told his ministers.

“The reason behind this capital relocation is because we want equitable economic development. The Java island makes up 58 percent of our national gross domestic product [GDP], and that is why we want regions outside Java to also see economic activities,” Jokowi said.

Java has also become way too populated.

Indonesia is home to 270 million people, according to the 2020 national census by the Central Statistics Agency (BPS). There are almost 48.3 million people currently living in West Java, whereas the eastern part of the island boasts around 40.7 million in population size. Jakarta, which lies on the northwest coast of Java, has 10.6 million people, while the population in Banten reaches 11.9 million. Central Java has 36.5 million residents. Yogyakarta -- a special region also located in Java -- has almost 3.7 million people.

“As many as 56 percent of our population live in Java island, so that’s something we factor in when moving the capital. … And we know how Jakarta has become overcrowded,” Jokowi said.

Early government estimates reported that Indonesia would need $33 billion to build Nusantara, but the government is only planning to pay for 20 percent of the total costs. Jokowi wants investors to cover the rest of the funding under a public-private partnership scheme. According to Jokowi, Nusantara has garnered investments worth a total of Rp 56.2 trillion (around $3.5 billion) to date.

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