Nusantara, the capital Indonesia is carving out of East Kalimantan forest, looks ready for a crowd that has not arrived. ABC correspondents found a presidential palace, offices, apartment towers and wide roads, and very little noise. The plan was 1.2 million residents by 2029. About 10,000 people live in the core so far.

Former president Joko Widodo took the decision in 2019. Building started in 2022, more than 1,200 kilometres from Jakarta, to shift weight off Java and out of a sinking metropolis. The expected cost was about $45 billion. By 2045, a century after independence, the city was meant to hold 1.9 million people.

Jakarta is still the capital in daily life. Greater Jakarta passed 42 million people on UN estimates cited by ABC. About 40% of the city sits below sea level. Traffic and air are heavy, and the north still floods in the rainy season behind a sea wall. The move was meant to ease both crowding and flood risk.

In 2024 Jokowi marked Independence Day at the Nusantara palace after a partial inauguration. That year's budget was about 43 trillion rupiah, roughly $3.5 billion. After Prabowo Subianto took office, the annual allocation fell to 13 trillion in 2025 and 6.3 trillion in 2026. Finance Minister Sri Mulyani Indrawati confirmed the 6.3 trillion figure when the 2026 budget draft was presented in August 2025.

The cut does not halt the site, but it slows it. Prabowo has steered money to other programmes, including school meals. Indonesia's Constitutional Court said in 2026 that Jakarta remains the official capital until the president issues a decree transferring the status to Nusantara. The state secretary had already said the decree waits on infrastructure. A political-capital shift aimed at 2028 is a target, not a completed move.

Ghost city is a reporter's label, not an administrative verdict. Residents and officials reject it. Empty roads and a small core are still facts on the ground. Without people, offices and a decree, Nusantara remains an expensive site with a palace, not the place where the country already decides.

Private investors have come more slowly than the plan promised. Without them, the bill sits on the state budget, just as the palace is cutting it. ABC describes a bet by the world's fourth-most-populous country that is still open: either Nusantara fills, or it stays a capital on the map and empty on the asphalt.

Image: Marwan Mohamad, road works near Istana Negara, Nusantara, CC BY-SA 4.0, Wikimedia Commons; an archive construction shot, not the ABC visit on 19 October 2026.

Sources consulted: Inside the ghost city designed to become Indonesia new capital - ABC News; Sri Mulyani Reveals 2026 Nusantara Capital Budget Drops to Rp6.3tn - Tempo.