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Government urges private sector to be involved in railway projects

This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content.

Investor Daily - Pemerintah dorong swasta terlibat di proyek perkeretaapian

11 January 2019

 

Jakarta — The Transportation Ministry is urging the private sector to participate in the construction of railway projects in the country. So, railway projects are not solely handled by the government, but also by the private sector.

“I hope the private sector can take part in the operation scheme, so development related to railways is not only handled by the government,” revealed Transportation Minister Budi Karya Sumadi after attending One-Year Review of Airport Train in Jakarta, Wednesday (9/1) evening.

Two railway construction projects which involve the private sector and is currently underway are Jakarta – Bogor – Depok – Bekasi (Jabodebek) Light Rail Transit (LRT) and Makassar – Pare-pare Train.

“We also have given two pilot projects which are currently ongoing, namely Jabodebek Train for which we assigned PT Kereta Api Indonesia to borrow [money] from the private sector with a certain interest rate to make investment and we will pay through availability payment. This is already running and this is the format which relies not only on the government, but also on the private sector,” explained the Minister.

In addition, he went on to say that the construction of Makassar – Pare-pare Train has also been carried out in some segments and the winner has been announced. “I was quite surprised because many private companies are willing to make contribution to Jabodebek Train project, such as from Korea and Japan,” he added.

The Minister explained access to the train also need to be backed by intermodal integration. In the future, a transportation integration scheme will be developed to further facilitate the citizens.

“Later, once Jabodebek Train is already completed, the train from Dukuh Atas can carry passengers with different destinations and with only Rp12 thousand, passengers can travel to Cibubur. And then, MRT Train will begin operation in February, so people from Lebak Bulus can take this train to go to Dukuh Atas. From Dukuh Atas, [they] can take Airport Train if they want to go to Soekarno Hatta. If the two transportation modes can be connected in Dukuh Atas, I’m sure that the occupancy rate of Airport Train can exceed 60%,” said the Minister.

At the moment, train is becoming increasingly popular among people, therefore the Minister will continue to improve train operation by, for instance, increasing the capacity of Commuter Line from the current 1.2 million passengers to 2 million passengers. In addition, the number of platforms and train cars will also be increased. The Ministry hopes they can be completed soon within two years.

Furthermore, the Minister also said the currently ongoing project is Jakarta – Surabaya Semi-Fast Train which has been approved to be built soon. “The next project which is also underway is Jakarta – Surabaya Train, we’re in discussion with Japan to finalise the feasibility study (FS) so the construction can start. Japan will provide a loan for us. The construction has been approved, so later Jakarta – Surabaya can be covered in only 6 hours [by train], while with [toll] road access, [it can be covered in] 9 – 10 hours, so this will facilitate and give alternative [transportation] modes to people,” said the Minister.

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