Sudden Resignations Shake $32 Billion Nusantara Project

The head and deputy head of Indonesia's new capital city authority overseeing the $32 billion Nusantara project have resigned. This development precedes President Joko Widodo's planned celebration at the new capital on August 17. The government is racing to build needed infrastructure for relocating 12,000 civil servants this September.

(Adds quotes and context from paragraph 2 onwards) JAKARTA, June 3 (Reuters) -

The head and deputy head of Indonesia's new capital city authority, who oversee the $32 billion project, have resigned, the state secretariat minister said on Monday. The resignations come ahead of President Joko Widodo's planned celebration at the new capital, called Nusantara, on Indonesia's Independence Day on August 17.

"The President has appointed the public works and housing minister and deputy agrarian minister as the acting head and deputy head," State Secretariat Minister Pratikno said in a surprise announcement from the state palace on Monday. The two officials had been assigned to speed up construction of the new capital, he said. No reason for the resignations was provided.

Bambang Susantono, a former official at the Asian Development Bank who was heading the new capital project, was not immediately available for comment. The development comes amid a lack of private funding for the ambitious new capital being built in a remote and jungled patch of Kalimantan, on the Indonesia part of Borneo island.

The government has been racing to build the infrastructure required for the relocation of the first batch of 12,000 civil servants this September. But the plan has previously been twice delayed, raising doubts about the president's signature project. Nusantara is regarded as a major legacy president Widodo, who will step down this October after serving the maximum two terms in office.

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