Subway cut in length and delayed again<\/p>\n
JAKARTA (JP): The capital's repeatedly delayed subway project,
\nscheduled to begin next year, will be postponed again until the
\nyear 2000, deputy governor for development affairs Budiardjo
\nSoekmadi said yesterday.<\/p>\n
Budiardjo gave no specific reasons for the new delay and said
\nthe budget for the project had been substantially cut, along with
\nthe length of the planned construction.<\/p>\n
The subway, which was originally supposed to cover a 14.5
\nkilometer stretch between Blok M in South Jakarta and Kota in
\nWest Jakarta, has been cut to 12 kilometers in length.<\/p>\n
Under the new plan, the subway will stretch from Jl. Fatmawati
\nin South Jakarta to the National Monument park in Central
\nJakarta.<\/p>\n
This will allow the budget to be cut from US$1.5 billion to
\nUS$1.2 billion.<\/p>\n
Itochu Corp. of Japan will still undertake construction work
\non the project, despite the significant changes which have been
\nmade.<\/p>\n
\"The central government has agreed to the project in principle
\nbut it will be discussed further by a joint team from the city
\nadministration and the transportation ministry which will be set
\nup as soon as possible,\" Budiardjo told the media after a meeting
\nwith Itochu representatives and central government officials at
\nthe City Hall.<\/p>\n
The meeting was also attended by Minister of Communications
\nGiri Suseno Hadihardjono.<\/p>\n
Last month, upon his return from a controversial trip to
\nManila, Governor Sutiyoso announced that the project would start
\nnext year with Itochu as the main developer. The Japanese company
\nreplaced a consortium of Indonesian, Japanese and German
\ncompanies called the Indonesia Japan Europe Group (IJEG).<\/p>\n
Sutiyoso said IJEG's proposal for the project cost \"too much
\nmoney and used too much high-tech equipment\".<\/p>\n
He chose Itochu because they came in with a bid of $1.5
\nbillion to do the work. IJEG submitted a proposal with a budget
\nof $2.4 billion.<\/p>\n
The cooperative agreement between the city administration and
\nIJEG, in which Itochu led the Japanese companies, was signed in
\nAugust 1995.<\/p>\n
The project was initially scheduled to start in April last
\nyear but was delayed because of the monetary crisis.<\/p>\n
Budiardjo said that the project would be financed by a soft
\nloan from Itochu and the Japanese government at an interest rate
\nof 0.75 percent per annum with an option to repay it over 40
\nyears.<\/p>\n
He said the central government would help to pay back the
\nloan. (ind)<\/p>",
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