IKN Budget Blocked, Government Shifts Focus to Free Nutritious Food Program?

Kapanlagi.com - The development of Nusantara Capital City (IKN) has once again captured public attention after its project budget was blocked by the Ministry of Finance. In a firm statement, the Minister of Public Works and Public Housing (PUPR), Dody Hanggodo, revealed that until now, this ambitious project has not shown significant progress due to funding constraints.

When met at the Senayan Parliament Complex in Jakarta, Dody confirmed that the budget for the IKN project is still in a blocked status. "The realization of the IKN budget seems to be non-existent. Our budget is all blocked, so why ask where the progress is, the budget is not there," said Dody on Thursday (6/2/2025).

This situation raises various questions from many parties regarding the continuation of the project that is expected to become a symbol of Indonesia's progress. So, what will happen to IKN in the future after this concerning budget blockade?

1. Reasons for the Budget Block of IKN

The development of the Nusantara Capital City (IKN) has been hindered by the budget block imposed by the Minister of Finance, Sri Mulyani, causing this ambitious project to be forced to halt from its initial plans.

Dody Hanggodo explained that his ministry is still waiting for further decisions regarding the reopening of the budget. "Just wait, one at a time. I said one at a time first. The budget will be opened, we will discuss again, what is the most important? Eid, let’s take care of Eid first, after that, then what, you know," he said.

In addition, the possibility of an increase in the budget for this project is still under consideration. "That means there is potential for a budget increase, God willing. Yes, if it can be 1,000 trillion, why not? If it can," he added.

2. Plan to Reopen the IKN Budget

After the budget block occurred, the Ministry of Public Works and Public Housing (PUPR) is preparing to resubmit a request for fund disbursement to Sri Mulyani. Dody emphasized that the first step is to obtain approval from the Ministry of Finance to open the budget for the stalled project.

"After that, based on the approval, I will approach the Minister of Finance again. Minister of Finance, it has been approved, right? Please open our budget," he said, describing the steps his ministry will take.

However, before the funds can be disbursed, there will be an in-depth discussion to determine which projects will be the top priority in the development of the National Capital City (IKN), considering that the government also has other urgent focuses that need attention.

3. Free Nutritious Food Becomes a Government Priority?

Previously, Prabowo was known not to prioritize the new capital city. Economic observer from the Strategic and Economic Action Institution (ISEAI), Ronny P. Sasmita, assesses that although the IKN project continues, it is not the main focus of the current government.

"But as we know, it is not the main narrative of Prabowo anywhere in the forums we hear, including meetings with ministers, he does not make the New Capital City his main priority; Prabowo is still talking about free lunch, fiscal efficiency, and food and energy security," he said.

With a limited state budget, the government must choose more urgent priorities, and the free nutritious food program has become one of the prioritized initiatives.

4. Major Challenges in the Continuation of the IKN Project

Although there is still a budget allocated for the development of IKN in the 2025-2029 period amounting to IDR 48.8 trillion, several challenges still overshadow this project. One of them is the uncertainty of funding in the future.

Ronny estimates that there is a high possibility that the scale of this project will be reduced or even not completed on time. "So, I still see the chances of completion as 50-50. If later on Prabowo runs out of funds for his main programs, it could be that in 2026-2027, it will be reduced," he said.

In addition, low interest from private investors also poses a major obstacle. The economic prospects in IKN are still considered unattractive to many entrepreneurs, which makes investment in this area progress slowly.

5. Investment Prospects in IKN Are Still Unclear

The Deputy for Funding and Investment of the IKN Authority, Agung Wicaksono, revealed that investor interest in investing in the Nusantara Capital City (IKN) is very high, but the government will only focus on five main projects for the groundbreaking stage.

"Currently, our calculations (value) might be almost IDR 6.5 trillion. We will sort this out first. There are actually still many (other investors in line), but to maintain focus, we will start with 5 investors, from 5 different sectors," he explained.

However, challenges remain, as some investors still feel hesitant to step into an area that is still dominated by forests and has minimal infrastructure. Ronny added that the low potential for return on investment (ROI) is a consideration that makes many entrepreneurs think twice before investing in IKN.

6. Questions and Answers About the IKN Project

1. Why is the IKN budget blocked?

The blocking is carried out by the Ministry of Finance to reassess the priority scale of the state budget, including a focus on the program for free nutritious food.

2. Is the construction of IKN still ongoing?

Yes, the project is still ongoing, but on a smaller scale and with more selective priorities.

3. What is the total budget that has been allocated for IKN?

The government has allocated Rp 48.8 trillion for the period 2025-2029.

4. Are there any private investors interested in building in IKN?

Some investors have shown interest, but challenges such as infrastructure and low ROI remain obstacles.

(kpl/rmt)