By Stefanno Sulaiman
SUKARAJA, Indonesia (Reuters) - As plans by&nbsp;Indonesia's&nbsp;president to build a&nbsp;new&nbsp;$32 billion&nbsp;capital&nbsp;city on Borneo island&nbsp;slowly start to take shape, the once sleepy settlement of Sukaraja is being rapidly transformed.
Headman Rizki Maulana Perwira Atmadja, 38, said&nbsp;land&nbsp;prices around his village - 10 km (6 miles) from where a presidential palace is being built - had jumped four-fold.&nbsp;Some&nbsp;farmers had "suddenly bought a&nbsp;new&nbsp;car" after selling part of their palm or rubber plantations, he said.
His own business, a guest house and a cafe in front of palm trees, has also thrived with an influx of workers, Rizki said. He has rented out rooms for constructions workers while&nbsp;nearby, several homes have been turned into shops.
Four years after President Joko Widodo announced plans for a&nbsp;new&nbsp;capital, a site spanning&nbsp;nearly 260,000 hectares (642,474 acres) named Nusantara, construction is picking up pace in its central area. While&nbsp;some&nbsp;may be&nbsp;cashing in,&nbsp;others&nbsp;fear the transformation.
Yati Dahlia, 32, of the area's indigenous Balik tribe, has been trying to purchase&nbsp;land&nbsp;somewhere&nbsp;nearby, knowing her current home is located where government buildings are due to be built.
But she said prices had soared to 700 million rupiah to 1.2 billion rupiah (around $45,500 to $78,000) for a similar size plot just outside Nusantara's main area, up 10 times the government compensation for her&nbsp;land&nbsp;and a blue plywood shack where she now sells food.
"We feel like (the government) is killing us slowly," said Yati.
She and other members of the tribe are appealing for more, but many Balik people do not have proper documents for their&nbsp;land, which reduces leverage during negotiations with the government, Yati said.
Some&nbsp;people have also refused to move because they feel the&nbsp;land&nbsp;is their identity, said Balik tribe leader Sibukdin, 60.
"We only ask the government to give us special attention," said Sibukdin, who uses one name.
'FOR SALE SIGNS'
The project, being built in an area largely made up of forest interpersed with logging concessions, plantations, coal mines and villages, is envisioned as a green, smart city, but has been hit by delays due to the pandemic, while Japan's Softbank Group, which had promised funding, exited last year.
However, Jokowi, as the president is popularly known, has been adamant that his flagship plan to replace congested Jakarta is needed to spur economic growth in less developed parts of Southeast Asia's largest economy, outside the main island&nbsp;of Java.
This prospect of future growth has driven a&nbsp;land&nbsp;boom, with 'For Sale' signs every few kilometres (miles) along a dusty road just outside the designated city centre.
Land&nbsp;prices in places&nbsp;near&nbsp;a water reservoir had risen over 16-fold, said Junaidin, the village chief of Tengin Baru, a settlement of around 4,000 people within Nusantara's development zone.
In a bid to contain&nbsp;land&nbsp;speculation, Indonesian authorities have frozen administrative approval for&nbsp;land&nbsp;sales, though Junaidin, who goes by one name, said people had been conducting sales under the table.
Bagus Susetyo, head of the East Kalimantan chapter of the Real Estate Indonesia assocation, said transactions without&nbsp;land&nbsp;certificates were weak and could be cancelled if authorities ordered a crackdown.
He said large property companies had not sought to acquire&nbsp;land&nbsp;banks in Nusantara due to the moratorium on permits.
LAND&nbsp;SPECULATION
Numerous large projects in the country have faced delays due to&nbsp;land&nbsp;acquisition issues, including other key Jokowi projects such as a China-funded $7 billion fast-train project in Java and Jakarta's mass rapid transit railway.
However, the Nusantara authority said&nbsp;land&nbsp;speculation should not affect development plans as compensation for&nbsp;land&nbsp;would be measured fairly by an independent party.
"The government doesn't decide (prices) on its own, the same way that the residents can't decide for themselves. If price disputes happen, it will be resolved through the courts," the authority's secretary Achmad Jaka Santos Adiwijaya told Reuters.
During a visit in February, President Jokowi said all problems related to&nbsp;land&nbsp;acquisition have been resolved and payments to locals would be made this month, according to a statement from his office.
Jokowi has set an ambitious deadline for construction.
In the first half of 2024, Nusantara will be declared the&nbsp;capital. Key government buildings, including a palace and a presidential office, must be ready by August that year. More than 16,000 civil servants, police and military officers will move in from Jakarta next year.
More than 7,000 workers are currently at the site, with thousands expected to reinforce later in the year.
There has also been an influx of people from other areas seeking work.
Alpian, 55, who quit his job at a coal mine in another part of Borneo to sell clean water from a dispenser in the soon-to-be&nbsp;capital&nbsp;area, said he was earning twice what he used to make.
"More and more water is needed.. the supply from the state firm is not enough," Alpian said from the back of his silver pick-up truck.
($1 = 15,360.0000 rupiah)
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(Reporting by Stefanno Sulaiman; Writing by Gayatri Suroyo; Editing by Ed Davies and Raju Gopalakrishnan)

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Some cash in on land boom near Indonesia's new capital, others despondent