URBAN LIFE IN INDONESIA: GROWTH, PROBLEMS, JAKARTA, NOW THE WORLD'S BIGGEST CITY

URBAN LIFE IN INDONESIA

urban population of Indonesia: 58.6 percent of total population (2023); Rate of urbanization: 1.99 percent annual rate of change (2020-25 estimate). Major urban areas — population: 11.249 million Jakarta (capital), 3.729 million Bekasi, 3.044 million Surabaya, 3.041 million Depok, 2.674 million Bandung, 2.514 million Tangerang (2023) [Source: CIA World Factbook, 2025]

In many Indonesian cities, large numbers of people live in small houses made of stone, wood, or bamboo, often clustered tightly together in crowded urban villages or compounds. Access to clean water and proper waste disposal is frequently limited, and in densely populated areas—especially in Java’s major cities—homes are packed closely side by side. By contrast, cities experiencing less pressure from rural migration, such as Padang and Manado, have generally managed urban growth more effectively. Jakarta has been ranked on lists of the worlds most expensive cities, which are based on criteria based on a relative cost of living comfortably for expats. Most residents live in world far removed from that of expats. [Source: Clark E. Cunningham, Countries and Their Cultures, Gale Group Inc., 2001]

Jakarta is now the world;s largest city (See Below). Between 2001 and 2006, 77 buildings with 30 stories or more were completed, under construction or proposed. But infrastructure and development have not been able to keep pace with the population demands. A lot money earmarked for infrastructure projects has been siphoned off by corrupt officials. Since the 1990s, Indonesia has been overwhelmed with malls. Most cities of any size have one and large cities have several. As is the the case in developed countries, malls have become havens for the middle class and hang out spots for young people.

Growth of Indonesia’s Cities

A significant trend in Indonesia in the past 50 years has been urbanization. Between 1970 and 1990 the percentage of the population living in urban areas rose from 17 percent to 31 percent. In 2011 the urban population of Indonesia was 50.7 percent of total population. The rate of urbanization: was estimated to 2.45 percent annuallly from 2010 to 2015. The alrgest cities in 2015 were Jakarta, with 9.769 million people; Surabaya 2.787 million; Bandung 2.429 million; Medan 2.118 million; Semarang 1.573 million; Palembang 1.455 million/

While Indonesia's population was largely rural in the middle of the twentieth century, by the beginning of the twenty-first century, approximately 20 percent lived in towns and cities, with only three in five people working in agriculture.[Source: Clark E. Cunningham, Countries and Their Cultures, Gale Group Inc., 2001]

Cities on both the outer and inner islands have grown rapidly, and there are now twenty-six cities with populations exceeding 200,000.' As in many developing countries, Indonesia's population is still young. The above patterns are national, but there are ethnic and regional variations. Population growth rates vary across different areas due to factors such as economic conditions, standard of living, nutrition, the availability and effectiveness of public health and family planning programmes, and cultural values and practices.

Surveys showed that the movement toward urban areas, particularly those in Jawa Barat Province, southwestern Sulawesi, and Kalimantan, among other areas, stemmed not from the innate lure of the cities but from the lack of employment in the countryside. Migrants seemed to view the pollution, crime, anonymity, and grinding poverty of the city as short-term discomforts that would eventually give way to a better life. For high school and college graduates with no prospects for employment in the rural areas, this may in fact have been a correct assumption. But for those migrants without capital or qualifications, the main hope for employment was in the so-called informal sector, which offered work such as street vending, scavenging, and short-term day labor. Many migrants also cultivated tiny but nutritionally important gardens. [Source: Library of Congress]

Jakarta Named the World’s Largest City in 2025

A United Nations report that came out in November 2025 listed Jakarta as the world’s largest city with 41.9 million people living there, followed by Dhaka in Bangladesh, with to 36.6 million, with Tokyo in third with 33.4 million people. Jakarta rose from second place to replace Tokyo, which had been named the world’s largest city in the UN’s most recent assessment published back in 2000. [Source: Lyndal Rowlands, Al Jazeera, November 26, 2025]

The World Urbanization Prospects 2025 report from the United Nations Department of Economic and Social Affairs also found that the number of megacities — urban areas with more than 10 million inhabitants — has increased to 33, four times more than the eight megacities that existed worldwide in 1975.

Jakarta suffers from a number of problems, including rising sea levels, with estimates suggesting that as much as a quarter of the city could be submerged by 2050. The situation has become so severe that the Indonesian government has begun developing a new purpose-built capital, Nusantara, located in East Kalimantan on the island of Borneo.

Even as government functions shift to Nusantara, Jakarta’s population is expected to continue growing. The United Nations projects that an additional 10 million people could be living in the city by 2050. This rapid growth will intensify existing challenges, including inequality and the rising cost of living. Public frustration over these conditions has already surfaced, with large protests highlighting the struggles of low-income workers, including app-based motorcycle drivers and delivery riders.

The UN’s latest urban assessment also reflects changes in how cities are defined, aiming to address inconsistencies across countries. In most cases, the report measures individual urban areas rather than combined metropolitan regions, with only a few exceptions. Under the updated definition, a city is considered a “contiguous agglomeration” of one-square-kilometer grid cells, each with a population density of at least 1,500 people per square kilometer and a total population of at least 50,000.

Distribution of Indonesia’s Urban Population

Indonesia’s urban population is distributed very unevenly, with nearly 70 percent concentrated on Java, making it by far the most urbanized region in the country. A striking share—about one-fifth of the nation’s total urban population—lives in the Greater Jakarta area alone. [Source: Tommy Firman, Jakarta Post, September 20, 2014; Firman is a professor of urban and regional planning at the Bandung Institute of Technology (ITB) and a senior research fellow at the Ash Center for Democratic Governance and Innovation, Harvard Kennedy School]

Within Java, provinces such as Jakarta, West Java, Banten, and Yogyakarta all have highly urbanized populations, with more than 65 percent of residents living in urban areas. Outside Java, several provinces—including Riau Islands, East Kalimantan, Bali, Bangka Belitung Islands, North Sulawesi, and North Sumatra—also experienced rapid urban growth between 2000 and 2010, partly driven by regional autonomy policies.

Even so, many provinces—particularly in eastern Indonesia—still have relatively small urban populations. Overall, the relationship between urbanization and economic development is only moderate, indicating that higher urban population levels do not always directly correspond to higher regional income.

The number of large cities has grown significantly over time. In 1950, Jakarta was the only Indonesian city with more than one million people, but by 2014 that number had risen to 12. Notably, seven of these cities—including Jakarta, Tangerang, South Tangerang, Bekasi, Depok, and Bogor—are part of the Greater Jakarta region, underscoring its dominance as Indonesia’s primary “primate city.”

Urban development on Java has increasingly taken the form of expansive urban corridors linking major cities, such as the Jakarta–Bandung, Yogyakarta–Semarang, and Surabaya–Malang belts. In these areas, the distinction between rural and urban areas is becoming less clear. At the same time, population growth in central cities like Jakarta has slowed, while surrounding area —such as Bogor, Tangerang, Bekasi, and Depok—are experiencing rapid expansion.

Smaller and mid-sized cities, with populations between 100,000 and one million, could play a key role in balancing development. If properly planned, they may serve as important links between rural and urban areas, helping to distribute growth more evenly across the country.

Decentralization of Indonesia’s Urban Areas

Much urban growth has been in mid-sized cities. Jakarta’s population has experienced a rate of increase of about 1 percent a year, but there were signs of decentralizing trends in the early twenty- first century. For example, much growth has occurred in the greater Jakarta metropolitan area, known as Jabodetabek (for Jakarta — Bogor — Depok — Tangerang — Bekasi), home to an estimated 24.3 million in 2007, rather than in Jakarta proper. [Source: Library of Congress]

While the capital enjoyed a disproportionate amount of the nation’s resources in technology, health care, wealth, and political power during the Suharto era, after 1998 provincial governments began to demand a larger share. On January 1, 2001, a rapid decentralization program began that placed more authority at the level of the regency (kabupaten, a subprovincial but nonmunicipal unit of government) and municipality (kota). This process reportedly was going well in the mid-2000s.

“The transformation of a well-established pattern of urbanization may have been possible because, as anthropologist Pauline D. Milone observed in the mid-1960s, Jakarta has never been a true primate city in terms of being the only center for economic, political, administrative, higher education, and technical functions in the way that, for example, Bangkok has been for Thailand. In Java, Surabaya has always been a major import-export center and has long been home to an important naval station, and Bandung has been a center for transportation, higher education, and industry. Nonetheless, in terms of population growth and as a symbol of the centralization of power in the nation, Jakarta has grown steadily in size and importance.

Urban Development and Economic Growth in Indonesia

Urbanization is widely seen as closely linked to economic development, and as it continues to accelerate, the key challenge for Indonesia is managing this process so it supports broader social and economic progress. [Source: Tommy Firman, Jakarta Post, September 20, 2014]

A 2011 study by the World Bank found that between 1970 and 2005, every 1 percent increase in Indonesia’s urban population corresponded to about a 2 percent rise in per capita GDP. However, this impact was significantly lower than in countries such as Thailand and Vietnam, where the gains reached 8 and 10 percent, respectively, and also trailed China and India, where the figure was around 6 percent. The study concluded that Indonesia has not fully capitalized on urbanization as a driver of economic growth.

The Greater Jakarta area plays a dominant role in the national economy, generating roughly a quarter of Indonesia’s GDP (excluding oil and gas). Other major metropolitan areas—including Surabaya, Bandung, Semarang, Medan, and Makassar—together contribute about 15 percent.

Interestingly, the World Bank study found that intermediate cities, with populations between 500,000 and one million, tend to have the most efficient agglomeration economies. In contrast, many smaller cities (100,000 to 500,000 people) have struggled, experiencing declining productivity and even population loss. These challenges are often linked to limited infrastructure, shortages of skilled labor, and weak connections to major markets, ports, and larger urban centers.

At the same time, smaller towns and mid-sized cities outside Java are growing more rapidly than those on the island. These areas are becoming important hubs of economic activity, particularly in resource-based sectors such as palm oil, timber, coal, and oil and gas. Regions like North Sumatra, Riau, Riau Islands, and East Kalimantan have seen notable increases in their urban populations.

Despite this growth, urban development in Indonesia remains heavily concentrated in major cities—especially Jakarta, Surabaya, Bandung, and Semarang, along with Medan. However, the expansion of urbanization beyond Java may also reflect the positive effects of regional autonomy, which has given local governments greater authority to plan and manage development in their own areas.

Housing in Indonesia

Housing remains a serious challenge across Indonesia, affecting both urban and rural areas. In the countryside, many homes fall below even basic standards. By the late 1990s, only about 20 percent of residences had access to piped water, and by 2000, just two-thirds of the population had access to improved sanitation. In the mid-1990s, the country had 44.8 million dwellings, yet demand has continued to outpace supply. Each year, an estimated 735,000 new households require housing, creating a growing backlog that results in overcrowding and inadequate living conditions. Natural disasters—such as floods, earthquakes, droughts, and forest fires—along with local conflicts, have further worsened the situation, leaving over a million people displaced or homeless. [Source: Worldmark Encyclopedia of Nations, Thomson Gale, 2007]

Since 1974, the government has launched several major initiatives to address these challenges, focusing on both new construction and the rehabilitation of low-income housing and slum areas. One of the most significant efforts was the Kampong Improvement Program (1974–1993), which upgraded urban settlements and improved living conditions for more than 36 million people. By 2006, this approach evolved into the Urban Environment Upgrading Program, placing greater emphasis on community participation rather than centralized government control.

In 1990 alone, 210,000 new housing units were completed, and the total number of dwellings stood at 44.9 million by the mid-1990s. Housing construction, however, has struggled to keep pace with demand. In 1990, about 210,000 new housing units were completed—far short of annual needs. To accelerate development, the government introduced the One Million Houses Development Program (Satu Juta Rumah) in 2003, encouraging collaboration among local governments, private developers, and community groups. Additional plans have aimed to improve substandard housing and expand access to affordable homes, including a target to build over 1.3 million subsidized units between 2005 and 2009.

Migrations in Indonesia

Net migration rate: -0.7 migrant(s)/1,000 population (2025 estimate). The net migration rate in 2014 was -1.18 migrant(s)/1,000 population (154th in the world). [Source: CIA World Factbook, 2025 +]

Indonesians, particularly Javanese, are sometimes stereotyped as highly immobile, rarely venturing beyond the confines of their village environment, but this image may be due to a lack of clear data and an extraordinarily complex pattern of movement in the population. By the early 1990s, out-migration had become a common response to overcrowded conditions caused by population growth. Some of these resettlements resulted in conflicts with the indigenous populations, and by the late 1990s, many transmigrants were fleeing conflicts in Aceh, Kalimantan, Maluku, Sulawesi, and Timor. As a result, by 2000 the government’s long-standing Transmigration Program was discontinued. [Source: Library of Congress *]

Many communities, particularly in Sumatra, have a long tradition of sending young adult males on merantau (cyclical out-migration) as a means for them to gain experience and income and reduce household expenses. Since the 1970s, however, interprovincial migration has increased dramatically for all regions. In addition, the financial crisis of 1997 — 98 resulted in a major increase in migration overseas in search of work, and the violence in Aceh, Kalimantan, Maluku, Sulawesi, and Timor has resulted in some 1.2 million internally displaced persons, about half of whom are living in refugee camps. According to the 2000 census, some 7.1 million of all Indonesian males living in urban areas (16.6 percent of this population category) were migrants. Among individual localities, Jakarta led with 42.6 percent of its male population being migrant, followed closely by Kalimantan Timur Province, with 41.3 percent, and Papua and Riau, each with 39.0 percent. The proportion in rural areas was much less; overall, only 6.1 percent of males in these areas nationwide were emigrants. Kalimantan Timur and the province of Riau had the greatest proportions, with 30.7 percent and 28.2 percent, respectively. *

Indonesians were also engaging in what demographers call circular migration and other kinds of commuting in greater numbers than ever before. This trend was linked in part to the steep increase in the number of motor vehicles, from 3.0 per 1,000 population in the 1960s to 26.2 in 1980, 46.3 in 1990, 78.1 in 2000, and 132 in 2007. With the widespread availability of public bus transportation connecting cities and villages, many workers commute 50 kilometers or more daily to work. Others live away from their homes for several days at a time in order to work. The World Bank has estimated that 25 percent of rural households have at least one family member working for part of the year in an urban area.

In part because of increasing migration, Indonesians of different ethnic backgrounds and occupations are increasingly intermingling. They more frequently find themselves in circumstances in which they cannot rely on kin and village networks for social support, and so they look to government services for help, particularly in the areas of education and health care.

Need for a National Urban Development Policy in Indonesia

Indonesia faces a pressing need for a coherent national policy on urban development and urbanization—one that directly addresses widening regional disparities, particularly the challenge of fostering new urban growth centers in eastern parts of the country. In the late 2000s, the government introduced the Rencana Tata Ruang Nasional (National Spatial Development Plan) to encourage more balanced development. However, its impact has been limited, largely because it has not been consistently aligned with investment strategies and infrastructure planning. [Source: Tommy Firman, Jakarta Post, September 20, 2014]

In practice, investment and infrastructure projects have continued to concentrate on Java—especially in the Greater Jakarta area—further widening the gap between the capital and other regions. This imbalance has reinforced Jakarta’s dominance while leaving many other cities struggling to keep pace.

To improve coordination, the government established the Badan Koordinasi Penataan Ruang Nasional (BKPRN) at both national and regional levels. Yet its effectiveness has been undermined by competing policies, particularly those related to investment and infrastructure, which often overlook or fail to address regional inequality.

A more effective national strategy would need to go beyond simply redistributing urban growth. It should also tackle broader challenges such as environmental sustainability, urban livability, poverty reduction, and the strengthening of governance and institutions. Crucially, it must also prioritize more balanced urbanization across the country, especially by supporting development in eastern Indonesia, where growth has lagged behind.

Image Sources: Wikimedia Commons

Text Sources: “Encyclopedia of World Cultures Volume 5: East/Southeast Asia:” edited by Paul Hockings, 1993; “Culture and Customs of Indonesia” by Jill Forshee, Greenwood Press, 2006; National Geographic, New York Times, Washington Post, Los Angeles Times, Smithsonian magazine, Encyclopedia.com, Library of Congress, Indonesia Tourism website (indonesia.travel), Indonesia government websites, Live Science, The Conversation, The New Yorker, Time, BBC, CNN, Reuters, Associated Press, AFP, Lonely Planet Guides, Google AI, Wikipedia, The Guardian and various websites, books and other publications.

Last updated April 2026