In a significant move, Indonesia's parliament has bestowed special status upon Jakarta, designating it as the country's economic hub, as preparations for relocating the capital to Nusantara on the island of Borneo gather momentum.

Reported by Reuters, Jakarta's new designation comes amid the city's struggles with overpopulation, congestion, sinking land due to excessive groundwater extraction, and escalating air pollution. Home to over ten million people, Jakarta's infrastructure strains under the weight of rapid urbanization, with even minor rainfall resulting in flooding.

The decision to move the capital to Nusantara in East Kalimantan, Borneo province, represents one of outgoing President Joko Widodo's flagship projects, aimed at alleviating Jakarta's burdens and redistributing economic opportunities across the Java archipelago. With an estimated budget of $32 billion, the construction of the new capital is poised to reshape Indonesia's administrative landscape.

Under a law passed on March 18, a unified council will oversee development efforts in both Jakarta and the emerging capital. Interior Minister Tito Karnavian outlined plans to bolster Jakarta's competitiveness on the global stage, fostering economic growth and enhancing its contribution to Indonesia's GDP.

Despite the impending relocation, Jakarta will retain its status as the capital until a presidential decree formalizes the transition. However, preparations for the move are well underway, with Indonesia set to celebrate its Independence Day in Nusantara on August 17. Moreover, by year-end, thousands of government officials are slated to relocate to the new capital, marking a significant milestone in Indonesia's administrative evolution.