Indonesian court rules Jakarta remains capital until presidential decree issued

The Constitutional Court of Indonesia has rejected a judicial review petition challenging the legal framework governing Indonesia’s planned relocation of its capital city to Nusantara Capital City, reaffirming that Jakarta remains the capital of Indonesia until a Presidential Decree formally authorising the transfer is issued.

The ruling was delivered during a plenary hearing on Tuesday, 12 May 2026, chaired by Chief Justice Suhartoyo.

“Rejecting the applicant’s petition in its entirety,” Suhartoyo stated while reading the verdict.

The case centred on a petition filed by Indonesian citizen Zulkifli, who argued that inconsistencies between Law No. 3 of 2022 on the National Capital City (IKN Law) and Law No. 2 of 2024 concerning the Special Region of Jakarta (DKJ Law) had created legal uncertainty over the constitutional status of the national capital.

The petitioner contended that Article 2 paragraph (1) of the DKJ Law, which changes the status of Jakarta from the “Special Capital Region” to the “Special Region of Jakarta”, conflicted with Article 39 paragraph (1) of the IKN Law, which states that the position and function of the national capital remain in Jakarta until a Presidential Decree formally transfers the capital to Nusantara.

According to the petition, the coexistence of the two laws created what was described as a “constitutional vacuum”. The petitioner argued that Jakarta was no longer normatively recognised as the national capital under the DKJ Law, while Nusantara had not yet formally become the capital because the required Presidential Decree had not been issued.

The petition further stated that such uncertainty could affect the legality of state administrative decisions, governance activities, and public administration.

The Court rejected those arguments, ruling that the provisions of the DKJ Law must be interpreted together with Article 73 of the same law, which stipulates that the law only comes into force upon the issuance of a Presidential Decree concerning the transfer of the capital from Jakarta to Nusantara.

Constitutional Justice Adies Kadir stated that the transfer of Indonesia’s capital city remains legally dependent on the enactment of the Presidential Decree.

“In other words, in the context of the present petition, the effective timing of the transfer of the national capital to Nusantara Capital City depends upon the issuance and enactment of the Presidential Decree in question,” Adies said while reading the Court’s legal considerations.

The Court concluded that there was no legal vacuum or suspended constitutional status, because Jakarta legally continues to function as Indonesia’s capital city until the Presidential Decree is signed.

“Accordingly, based on those legal considerations, and in relation to the applicant’s petition, the Court is of the view that, without the interpretation of Article 39 paragraph (1) of Law No. 2 of 2024 as requested by the applicant, the position, function, and role of the national capital shall remain within the Special Capital Region of Jakarta until the issuance of a Presidential Decree concerning the transfer of the capital of the Republic of Indonesia from the Special Capital Region of Jakarta to Nusantara Capital City,” Adies said.

The petitioner had also argued that the legal uncertainty stemmed not merely from delays in implementation, but from the legislative structure itself. According to the petition, the laws lacked transitional safeguards and guarantees to ensure continuity of the capital city’s legal status during the relocation process.

The petition maintained that the status of the national capital constitutes a fundamental component of Indonesia’s constitutional order and therefore could not be left in an uncertain or undefined legal condition.

Under Article 39 of the IKN Law, the transfer of the national capital is to be formalised through a Presidential Decree. Article 41 further states that Jakarta’s future status after ceasing to serve as the national capital will be regulated under a separate law.

The relocation project involves the construction of Nusantara in East Kalimantan on the island of Borneo. The initiative was launched under former president Joko Widodo as part of a long-term strategy to redistribute economic development and reduce the concentration of population and economic activity on the island of Java.

Speaking during the opening of the 18th Congress of the Central Executive Board of Muhammadiyah Youth in Balikpapan, East Kalimantan, on 22 February 2023, Widodo said the development of Nusantara was intended to promote more balanced national growth.

“Everything is concentrated on Java — 58 per cent of economic GDP and 56 per cent of Indonesia’s population are located on Java. The island has become extremely densely populated, which is why we need equitable development that is no longer Java-centric, but Indonesia-centric,” the President said at the time.

Widodo also stated that the plan to relocate the capital predated his administration. According to him, Indonesia’s first president, Soekarno, had proposed moving the capital to Kalimantan during the 1960s, specifically to Palangkaraya.

“This dates back to Bung Karno in the 1960s. Bung Karno had already intended to move the capital from Jakarta to Kalimantan, specifically to Palangkaraya,” Widodo said.

He added that the relocation project was intended not only to move government institutions physically, but also to transform administrative culture and governance systems.

“So we hope this new capital city will truly become a capital unlike any other in the world,” he remarked.

Widodo previously expressed confidence that the Nusantara project could be completed within 15 to 20 years, with Jakarta continuing to function as Indonesia’s business, tourism, and economic centre after losing its capital status.

The relocation programme has become one of Indonesia’s largest infrastructure undertakings in recent decades. According to publicly disclosed government figures, cumulative state budget spending for Nusantara development had reached Rp147.41 trillion (approximately US$8.5 billion) by the first quarter of 2026.

The figure includes Rp89 trillion (approximately US$5.1 billion) spent during the initial development phase between 2022 and 2024, followed by additional allocations under the administration of President Prabowo Subianto for the 2025–2026 period to complete the core government district.

Former Head of the Nusantara Capital Authority, Basuki Hadimuljono, stated in early 2025 that the initial Rp89 trillion allocation had funded major infrastructure projects including logistics toll-road access, main roads, residential towers for civil servants and defence personnel, clean water and sanitation systems, reservoirs and flood-retention ponds, ministry office complexes, the Presidential Secretariat building, and integrated places of worship.

Official financial reports showed that IKN-related expenditure totalled Rp5.5 trillion (approximately US$317 million) in 2022, rising to Rp27 trillion (approximately US$1.6 billion) in 2023 and Rp43.3 trillion (approximately US$2.5 billion) in provisional audited spending for 2024.

According to the latest publicly available, Ministry of Finance figures released in January 2025, budget absorption for the 2024 fiscal year reached Rp43.4 trillion (approximately US$2.5 billion), or approximately 97.3 per cent of the annual allocation ceiling of Rp44.5 trillion (approximately US$2.6 billion).

To maintain continuity of the project, the government approved a multi-year budgeting scheme for 2025–2029 valued at an estimated Rp48.8 trillion (approximately US$2.8 billion).

Under Indonesia’s National Medium-Term Development Plan, the broader funding structure for Nusantara is projected to include Rp90.4 trillion (approximately US$5.2 billion) from the state budget, Rp123.2 trillion (approximately US$7.1 billion) from state-owned enterprises and private investment, and Rp252.5 trillion (approximately US$14.6 billion) through Public-Private Partnership schemes.

The Nusantara Capital Authority has stated that it has secured investment commitments amounting to Rp225.02 trillion (approximately US$13 billion) through a combination of direct private investment and infrastructure partnership projects.

Following the Court’s ruling, the Authority stated that it respected the constitutional process and said the decision clarified the legal mechanism governing the transfer of the capital.

“The Nusantara Capital Authority respects all constitutional processes taking place at the Constitutional Court as part of Indonesia’s democratic and rule-of-law mechanisms,” said Troy Pantouw, spokesperson for the authority, on Thursday, 14 May 2026.

According to the Authority, development of Nusantara is continuing in accordance with government planning stages, including the construction of basic infrastructure, government districts, business ecosystems, and public services.

“We invite all parties to continue maintaining optimism, stability, and public confidence in the development of IKN as part of efforts to realise a more advanced, modern, and competitive Indonesia,” Troy said.

With the Constitutional Court’s ruling now final and binding, all central government administration and the formal constitutional seat of the Indonesian state remain legally based in Jakarta until a Presidential Decree officially transfers the capital to Nusantara.