More than two hours by air from Jakarta, and another two-hour drive from Balikpapan airport, a new city is appearing the middle of Borneo Island’s vast rainforest.

Next August, Indonesian President Joko Widodo will shift some government functions to the new capital, Nusantara. Widodo plans to hold next year’s Aug. 17 Independence Day celebration outside the new presidential palace, just before his term ends in October 2024.

With only a year to go before the relocation, a senior government official recently expressed big ambitions for the relocation: to make the new capital an economic hub by attracting a nucleus of businesses from various industries, including renewable energy and health care.

“It is not just about wanting to relocate the capital. We don’t just want a place for government functions,” said Danis H. Sumadilaga, “We want to create a new economic growth center.”

Sumadilaga heads the task force overseeing infrastructure development implementation at Indonesia’s Ministry of Public Works and Housing. He spoke to reporters in late July during a media tour of the construction site organized by Japan International Cooperation Agency (JICA), which has provided technical advice on the city’s construction.

Sumadilaga said the government is trying to attract businesses in areas such as renewable energy, health care, education and agriculture, although he also stressed the current capital, Jakarta, will continue to develop.

After his reelection as president in 2019, Widodo announced plans to move the capital, citing Jakarta’s overcrowding and pollution, as well as the need for a growth engine in the eastern half of the far-flung island nation. In an interview with Nikkei Asia last November, Widodo vowed to build “a fintech center” in Nusantara, adding that the government would offer “very competitive investment incentives there.”

The relocation is scheduled to take place in five phases through 2045. Sumadilaga said that for the first phase, including the core government area covering 66.71 sq. kilometers, 36% of the construction had been completed, including some stretches of toll roads and the presidential office. The pillars of a main building were visible at the construction site. He said building work would be 70% completed by the end of the year.

Although Sumadilaga acknowledges the challenge of “rising cost” for construction materials in the wake of the Ukraine war, he maintained that the project is “on schedule.”

The Indonesian government estimates the population of Nusantara will reach 60,000 next year, rising to 2 million by 2040 and more than 4 million in 2060. The city will have a land area of 2,561 sq. kilometers.

Envisioned as a “green and smart global city,” the megaproject is central to Widodo’s vision of pushing Indonesia into the ranks of developed nations and fulfilling its zero-carbon pledge by 2060. A short film shown during the July media tour featured images of a futuristic, well-connected city equipped with modern public transport and surrounded by lush rainforest.

To turn the plan into reality, Indonesia has called on foreign governments and companies to invest in building the new capital and is offering incentive packages as a sweetener. Of the 466 trillion rupiah ($30.8 billion) in expected construction costs, plans call for 80% to be funded by the private sector and rich-country governments.

So far, no big, concrete pledges of foreign investment have materialized. But Sumadilaga said Indonesia has received about 300 letters of intent, of which about 30 are moving toward investment. Foreign companies from China, South Korea, Singapore and Japan have expressed interest in taking part, Sumadilaga said.

More recently, Widodo and Chinese President Xi Jinping, during their recent bilateral meeting in China, agreed to work together to build the new capital. China is also ready to expand cooperation in areas such as electric cars and smart cities, according to China’s Foreign Ministry.

Meanwhile, Takehiro Yasui, the head of JICA’s Indonesia office, told reporters during the July visit that “Japan has an advantage [in offering support]” to build an environmentally friendly city, citing the country’s technological expertise.

South Korean technology, meanwhile, is going into the Sepaku Semoi dam, which is being constructed in the middle of oil palm plantations and aims to provide clean water for Nusantara and nearby areas. According to local officials, the areas will be the first to offer drinkable tap water.

“[We are] eagerly waiting for the day” to drink the water next year, one local official said.