Indonesian President Joko Widodo said Monday "everything was still in progress" during a visit to the country's planned new capital, the flagship of his two terms in office but which has been plagued by delays.

The capital is due to move from traffic-clogged and sinking Jakarta to the planned city of Nusantara in East Kalimantan province, but the project is months – even years – behind schedule.

Widodo was expected to attend a flag ceremony in Nusantara on August 17 to mark Indonesia's Independence Day and has invited VIPs including ambassadors and key investors to the event.

But the overall project is way behind schedule and a first wave of thousands of civil servants due to move to the city in September has already been postponed by several months.

"We came here to check the latest progress on the development... particularly the construction of the palace," Widodo said in a statement.

"I see that everything is still in progress."

The president, First Lady Iriana Widodo, and several officials arrived in Nusantara on Sunday, along with a number of Indonesian social media influencers. They rode along an under-construction toll road that connects the Nusantara with the nearest city, Balikpapan.

The government aims to have 1.9 million people living in Nusantara by 2045, importing a wave of human and industrial activity into the heart of Borneo.

Environmentalists have warned that the planned city will speed up deforestation in one of the world's largest stretches of tropical rainforest.