After seeing its proposal for an earlier railway project shunted into a siding after requesting a sovereign guarantee, Japan has been invited to submit a proposal for a new medium-speed, double-track railway line linking Indonesia’s two largest cities, Jakarta and Surabaya.
The proposed Jakarta-Surabaya railway project is expected to cut travelling time from the current 11-hours to just six-hours, with trains travelling at speeds of between 180 to 200 kph (111-124mph). In addition to reducing the passenger travel time the new Jakarta-Surabaya railway will also speed up the transfer of goods from the port city of Semarang on the north coast of Java to Surabaya.
Despite being five times the distance of the $5.5 billion, 156km (96.93 miles) high-speed Jakarta-Bandung railway project that Japan lost to China last year, the 725km (450mile) Jakarta-Surabaya railway project is expected to cost just $3 billion.
Last year Japan, historically one of Indonesia’s largest foreign investors saw its bid for the Jakarta-Bandung high-speed railway project sidelined in favour of rival China when it stipulated a government guarantee was necessary. In response Indonesia awarded the $5.5 billion project to China Railway International Co. Ltd., a subsidiary of China Railway Group Ltd., and Indonesian state-owned enterprises, who didn’t require such an undertaking.
Indonesia Minister of Transport Budi Karya Sumadi told Reuters, ‘”We are giving the priority to Japan”’, adding that the project could include building a new line, upgrading existing tracks and supplying the rolling stock.
Last week Luhut Pandjaitan, Indonesia’s Coordinating Minister for Maritime Affairs, made a visit to Japan to discuss several topics including the Jakarta-Surabaya railway project with Japanese officials. His meeting seems to have been effective with both governments announcing they will conduct a joint survey expected to be completed in the first quarter of 2017.
Describing the Jakarta-Surabaya railway project – which will see the elimination of some 1,000 level crossings – as being part of the government’s efforts to revitalise vital infrastructure, Mr Pandjaitan said, the medium-speed Jakarta-Surabaya railway ‘”will have a tremendous impact on our economy”‘.
Construction could be carried out through a Japanese-Indonesian partnership, with Japan possibly funding the project via a low-interest loan. Between 2010-2015 Indonesia received over $14 billion in inbound Japanese foreign investment, with the Indonesia Investment Coordinating Board (BKPM) saying than half of it going into the transportation sector, according to .
However, speaking with The Jakarta Globe, Mr Sumadi said Indonesia is unlikely to give a sovereign guarantee for this Jakarta-Surabaya railway project either. ‘”We have had a lot of cooperation with foreign investors, and we’ve been delivering. There’s actually no need for a guarantee”‘, he said.
- Indonesia Asks Japan to Work on Jakarta-Surabaya Train Project (Jakarta Globe)
- Gov`t Invites Japan to Develop Medium-speed Train (Tempo Inti Media TBK)
- Indonesia asks Japan to work on Jakarta-Surabaya train project (Reuters)
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