Government to Invite Investors for High Speed Train in 2008
Monday, 24 July, 2006 | 19:37 WIB
TEMPO Interactive, Jakarta: The government is to invite local and foreign investors to invest in the Jakarta-Surabaya and Jakarta-Bandung high speed train projects in 2008.
The results of the government's analysis have shown that the projects will require funding of US$7.7 billion, or around Rp60 trillion.
“After the revisions to the Railway State Decree are completed, we'll invite all investors who are interested in the projects,” Soemino Eko Saputro, the Director General of Railway at the Department of Transportation, said last week.
The government and the House of Representatives (DPR) are targeting the discussions on the law revision will be finished by 2008.
Saputro explained that foreign investors who are interested are from France and China.
However, as it is still currently against the Railway State Decree to allow private companies to invest, the government is yet to agree to the investors’ wishes.
During the projects, Saputro added, investors may also get involved in the construction of facilities and infrastructure, especially as regards land acquisition.
They will only be allowed to be involve in the construction process so that the government will own the assets.
In addition, the funding will come either from the state budget or foreign loans.
Previously, Indonesian Railway Watch (IRW) had asked the government to re-evaluate its plan.
The reason for this is because it is expected that there will be problems like the decrease in train passengers and tight competition with other means of transport like airplanes.
“It's only the government's dream,” said Taufik Hidayat, the Executive Director of IRW.
This institution has evaluated that people's low purchasing power in terms of railway services will only create financial losses for the government.