ADB Provides US$150 Million Loan to Linknet to Strengthen Indonesia's Digital Infrastructure
Strengthen Indonesia’s Digital Infrastructure, ADB Provides US$150 Million Loan to Linknet
Asian Development Bank (ADB) has provided a loan of US$150 million to PT Link Net Tbk (Linknet) to support the improvement of digital infrastructure in Indonesia and improve the quality of broadband services.
Linknet is one of the broadband service providers in Indonesia, with the majority of its shares owned by Axiata Group Berhad, a telecommunications and digital services company focused on mobile and broadband services in the Asia region.
The financing will be used to strengthen Linknet’s financial condition while supporting continued investment in the fiber-optic-based broadband market, and this step is also in line with the company’s strategy which is now focusing on the business-to-business (B2B) business model.
Head of ADB Representative for Indonesia, Bobur Alimov, stated that this cooperation confirms ADB’s role as a strategic partner in supporting Indonesia’s digital transformation agenda.
“By supporting the expansion of Linknet’s digital infrastructure services, we aim to provide inclusive and fair access and unlock the potential of the country’s digital economy, which is estimated to reach 366 billion US dollars by 2030,” he said in a statement, Tuesday, March 10.
Through this agreement, the public and business actors will find it easier to access various digital technologies.
Meanwhile, the investment made by Linknet includes the expansion of the fiber-to-the-home (FTTH) network nationwide, namely high-speed internet services that are directly connected to the home via fiber optic cable.
In addition, Linknet will also develop an open-access wholesale model, which is expected to improve the quality of broadband services, encourage productivity, and expand participation in the digital economy, especially for micro, small, and medium enterprises (MSMEs).
This cooperation also supports Indonesia’s commitment to climate issues through the use of energy-efficient technology and the improvement of the quality of network assets.
Since 2015, the mobile broadband industry in Indonesia has experienced quite rapid growth, however, the adoption, access, and price of broadband services, especially fiber optic networks, are still lagging behind compared to some neighboring countries.
To overcome this, the government is preparing sector policies aimed at simplifying the licensing process and standardizing the cost structure to create healthier competition in the optical fiber broadband industry.
Meanwhile, Linknet Chief Executive Officer, Kanishka Gayan Wickrama, said that his party welcomed cooperation with ADB in this strategic project to strengthen support for Indonesia’s digital economic growth.
“This financial agreement will allow us to provide more efficient and faster services to our customers. This will also allow us to access long-term financing to align with our strategic and operational shifts,” he said.