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Prabowo is confident state budget can finance IKN, his nutrition program

The development of the new capital is expected to cost some Rp 466 trillion (US$30.1 billion), while the nutritional improvement program would require Rp 400 trillion a year.

Novan (The Jakarta Post)
Jakarta
Fri, January 5, 2024

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Prabowo is confident state budget can finance IKN, his nutrition program Defense Minister and presidential candidate Prabowo Subianto greets residents when visiting Zainul Hasan Genggong pesantren (Islamic boarding school) in Probolinggo, East Java, on Dec. 2, 2024. (Antara/Irfan Sumanjaya)
Indonesia Decides

Presidential candidate Prabowo Subianto says that the state budget can cover both the National Capital City (IKN) project and his nutritional improvement program, which would include free lunches and milk for school-age children along with nutritional assistance for pregnant women.

Antara has reported that the development of the new capital is expected to cost some Rp 466 trillion (US$30.1 billion), while the nutritional improvement program would require Rp 400 trillion a year.

Prabowo said the IKN budget was not a one-year expense.

"The cost for the IKN seems substantial. Rp 400 trillion equals $30 billion. Is it in one year? Is it in five years? Is it in 10 years?” Prabowo asked, as quoted by kompas.com.

“Now if we construct the IKN in 15 years, that means it needs $1.5 billion per year [sic].”

Prabowo added that the current infrastructure budget was nearly Rp 300 trillion.

"Rp 440 trillion sounds like a lot, but Indonesia can [afford it]. Even now, Rp 500 trillion of the state budget is for social aid, and another Rp 600 trillion is for education," Prabowo said on Thursday, as quoted by Antara.

"My question is whether feeding kids counts as social aid. And, secondly, can feeding children at school be allocated to the education budget?"

As a part of his nutritional improvement program, Prabowo plans to provide free milk for children. He wants the program to reach 82 million children and says the government would need to provide 40 million liters of milk.

To achieve this, "we might have to import 1 or 1.5 million cows", said Prabowo. "These cows will give birth in two years, so we will have 3 million."

He also discussed the possibility of an increase in state funds once the government implemented better tax and non-tax revenue systems.

He said Indonesia currently had a tax ratio of 12 percent, while neighboring countries such as Vietnam and Thailand both had tax ratios of 18 percent.

Prabowo said that if Indonesia could achieve the same tax ratio as Thailand and Vietnam, the government would have an additional $90 billion for the state budget.

"And the government is working toward realizing that through digitalization, efficiency and so on. We do have great potential," he said.

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