A tale of two systems in Jakarta's transport<\/p>\n
This is the first of two articles on transportation in Jakarta by
\nHeru Dewanto, who heads the Center for Technology and Industry
\nDevelopment. He is also CEO of the Jakarta-based Rekainfra
\nInternational company which is among the consultants for the
\ncity's mass transit project.<\/p>\n
JAKARTA (JP): Those who have visited the Indonesian capital
\nand have been trapped in the battlefield of Jakarta's traffic
\nwould agree: This city -- with a projected population of over 12
\nmillion by the year 2015 -- is heading for total gridlock in a
\nfew years if measures are not taken to address its urban
\ntransportation management.<\/p>\n
For years, extremely severe congestion and low levels of
\nservices have been taken for granted by Jakartans. Part of the
\nsolution is the introduction of efficient, cost effective and
\naffordable public transportation systems which will encourage the
\nmove of the commuting workforce from roads to rail, thus easing
\nthe burden on the existing road system.<\/p>\n
This can further be assisted by, among other things, added
\ncapacity and a comprehensive traffic management system.<\/p>\n
The provision of mass transit in our developing cities has
\nbeen our main concern for many years -- the provision of a safe,
\nreliable, quick and comfortable means of transportation combining
\nthe convenience of private cars and the compact movement of
\npublic transit.<\/p>\n
The basis of the development for Jakarta's mass transit was
\nthe Consolidated Jakarta Mass Transit Network -- based on three
\nstudies that prepared alternative forecasts of mass transit
\npassenger demand in Greater Jakarta. These were the studies of
\nthe Integrated Transport System Improvement by Railway and Feeder
\nServices in 1990, the Jakarta Mass Transit System Study and the
\nTransport Network Planning and Regulation project both in 1992.<\/p>\n
The studies differed in their emphasis but resulted in
\nslightly different networks for Jakarta's mass transit.<\/p>\n
Though the network has been prepared since 1994, the question
\nlies in the ways of providing it. Financial constraints of the
\ngovernment have led to a major shift toward private provision.<\/p>\n
Private infrastructure is mostly being financed through
\nlimited or nonrecourse project finance techniques in which the
\nlenders do not have recourse to the parent company but instead
\nrely primarily on the cash flow generated by the project.<\/p>\n
This results in the project-company asking the government to
\nhelp mitigate both the commercial and sovereign risks. Compared
\nto other infrastructure, mass transit is associated with an even
\nmore complex risk structure. The state would thus need to provide
\ndirect or indirect financial support to maintain financial
\nviability and to attract the private sector.<\/p>\n
The private sector's reluctance to fund this sector is caused
\nby critical issues -- higher market risks, extremely huge initial
\ncapital costs, long-term investment, complex operation and high
\noperating costs.<\/p>\n
Also, there is reliance on operating subsidy, complex
\nrelations between the rail system and civil works, the low level
\nof willingness of the user to pay, a long payback period and huge
\nland requirement. Mass transit would be dependent upon related
\ninfrastructure development, and would moreover have to face
\nunequal competition with highways.<\/p>\n
The mass transit project thus needs new approaches. Private
\ninvestment in mass transit needs to become financially viable
\nwith either at least some budget support, significant increase in
\nfares or a government subsidy.<\/p>\n
Just before the onset of the economic crisis Jakarta had two
\ncompeting developments for mass transit in which both would share
\nthe north-south corridor of Jakarta city: the subway and the
\nJakarta Integrated Toll Road and light rapid transit (LRT),
\nwidely known as the triple-decker.<\/p>\n
The development of each appeared surprisingly stimulating, as
\nif the two were highly profitable investments that could attract
\ntwo private groups of companies. Given the lack of legal and
\nregulatory framework for private participation in this area, that
\nsituation could only be explained by the fact that the
\ncompetition was not based on a solid fundamental structure of
\nprivate provision on mass transit, but more on competing
\npolitical powers, reflecting the situation at that time.<\/p>\n
However, efforts of the two groups of companies in promoting
\nmass transportation for Jakartans should be appreciated.<\/p>\n
The next concern was the Jakarta railway network. If two lines
\nof the network were to be developed, they should have represented
\nthe two most prioritized lines. The urban rail master plan ought
\nto have been the basis for any development and it should have
\nbeen the government who decided which lines were most needed. The
\ncity should not allow any private initiatives to simply pick
\nroutes or make their own routes.<\/p>\n
The original idea of the triple-decker was to provide a mass
\ntransit system that was as far as possible independent of any
\ndirect or indirect government funding and\/or subsidies. This
\nwould be partly achieved by internal subsidy from toll road to
\nLRT. It was expected to be a solution to the age-old problem of
\nroad versus rail, and capital\/operating costs of public
\ntransportation versus revenue.<\/p>\n
This would be achieved by the combination of an LRT system and
\na toll road, both forming a common transportation corridor.
\nHowever, the minimum requirement for initiating this concept
\nwould be that both means of transportation should be designed for
\na common route as the bottom line. The concept could not be
\ndeveloped simply by attaching a toll road route to the planned
\nmass transit route.<\/p>\n
As the name triple-decker suggests, it was to be a structure
\nwhich, in part, consisted of levels, of which the topmost was a
\nsix-lane toll road. The next level was a double tracked LRT. This
\ncombination would result in minimized land requisition, optimized
\nstructure form and eventually reduced cost compared to if each
\nsystem were to stand separately.<\/p>\n
The combination concept would require integration of legal
\naspects as in the past, regulations not available to accommodate
\nprivate investment in two different means of transportation.<\/p>",
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