National road construction: Govt revises target
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.
Bisnis Indonesia - Pembangunan Jalan Nasional: Pemerintah Revisi Target
09 June 2021
By: Andi M. Arief
Jakarta – The Public Works and Public Housing (PUPR) Ministry will adjust the national road construction target until 2024 due to the discrepancy between the funding source and the construction cost.
Highways Director General of the PUPR Ministry, Hedy Rahadian, said that the national road construction target would be dynamic.
According to him, the target adjustment will follow the availability of the resources and the situation development.
“The strategic target will be evaluated and adjusted in line with the development of the state’s financing capability,” he said to Bisnis on Tuesday (8/6).
The Highways Directorate General of the PUPR Ministry has two main targets in 2024, which are to operate 4,630.25 kilometres of toll roads and to achieve 97% national road condition.
Moreover, until early 2021, the toll road operation realisation has only reached 2,342.42 kilometres, while the national road condition has only reached 91.27% or 47,017 kilometres.
Hedy previously noted that there were three challenges that must be faced in constructing toll roads in 2021 that boiled down to toll road project funding.
According to him, the cost and the available funds this year are not on the same level.
“With budget constraints for land [acquisition] and construction support, it is not easy [to achieve the 2024 target] as we need more funds,” he said.
His agency needs funds for land acquisition for toll road projects until 2024 worth Rp55.25 trillion. Besides that, Hendy said that his agency required funding up to Rp171.8 trillion for toll road construction services for the next four years.
On the other hand, SOE (State-owned Enterprise) companies are still enthusiastic about constructing toll road projects. For example, PT Hutama Karya (Persero) will request state capital participation from the government to support the construction and the operation of Trans-Sumatra toll road (JTTS).
Hutama Karya Corporate Secretary, Tjahjo Purnomo, said that his company had received Rp6.2 trillion through state capital participation this year for three toll segments of JTTS.
Moreover, the second state capital participation request will be submitted to construct and operate at least nine segments of JTTS.
