Indonesia's parliament has approved a bill to relocate the nation's capital from Jakarta to a jungle area of Kalimantan on Borneo island.
The new state capital law, which provides a legal framework for President Joko Widodo's ambitious $44.5 billion mega project, stipulates how development of the capital will be funded and governed.
"The new capital has a central function and is a symbol of the identity of the nation, as well as a new centre of economic gravity," Planning Minister Suharso Monoarfa said.
The new centre will be called Nusantara, a Javanese name for the Indonesian archipelago chosen by the President.
Plans to relocate the government from Jakarta, a bustling megacity of 10 million people that suffers from chronic congestion, floods and air pollution, have been floated by multiple presidents, but none have made it this far.
Jakarta's greater metropolitan area is two times smaller than greater Sydney, but about 30 million people live there.
The annual economic loss due to traffic congestion in Jakarta has been estimated at 100 trillion rupiah ($10 billion).
Work on the new capital is expected to begin in two years.
Nusantara to be a low-carbon tech hub
Jokowi, as the President is known, first announced the plan in 2019, but progress was delayed by the pandemic.
South-East Asia's largest economy has envisioned the new capital as a low-carbon "super hub" that will support pharmaceutical, health and technology sectors and promote sustainable growth beyond Java island.
Critics said the law was rushed through with limited public consultation and environmental consideration.
Nusantara, which follows the creation of new capitals in countries like Brazil and more recently Myanmar, will be led by a chief authority whose position is equivalent to a minister, deputy chair of the bill's special committee, Saan Mustofa, says.
Among those being considered for the position, according to local media reports, are former research and technology minister Bambang Brodjonegoro, and Jakarta's former governor, Basuki Tjahaja Purnama, better known as Ahok.
Water woes in Jakarta
It is not just congestion and pollution presenting a problem for authorities.
Much of Jakarta is also sinking at an alarming rate and it is predicted to face serious water shortages by 2040.
A World Bank report found the city would be 40 to 60 centimetres lower in 2025 compared to 2008 levels.
And without adequate adaptation strategies, the report said the sea would reach the Presidential Palace, which lies 5 kilometres inland.
There are also massive pollution problems in rivers and contaminated groundwater used by the majority of the city's inhabitants.
The city's sinking woes have been exacerbated by decades of wealthier Indonesians boring holes throughout Jakarta to bypass the city's water grid.
Centuries of history in Jakarta's streets
Jakarta began as the port of Sunda Kalapa within the Hindu Kingdom of Pajajaran, which ruled the western half of Java from the 670s.
In the centuries after, the port formed a link between the Indonesian archipelago and European traders alongside other ports such as Aceh and Makassar.
Under Dutch rule, Jakarta, which was known as Batavia, was the capital of the Dutch East Indies from 1621.
In the decades following Indonesia's independence in 1949, Jakarta has grown to become the country's economic capital, and one of the world's largest metropolitan regions.
Nearly 60 per cent of Indonesia's 260 million people live in Java and economic activities have been concentrated there.
ABC/wires
