Government may change joint operation deals in telecoms sector
Government may change joint operation deals in telecoms sector
JAKARTA (JP): The government may change the 15-year contracts
awarded to five companies to install and operate the country's
telecommunications networks outside Jakarta and East Java before
they expire in 2010, sources said yesterday.
Telecommunications industry sources said that the government
had prepared an amendment to the telecommunications law,
including an article dealing with the joint-operation schemes
awarded to the five companies.
"There will possibly be a policy to change the build, operate
and transfer plan in the joint-operation scheme to a build,
operate and own plan," one of the sources said.
The sources said that the law revision would lead to a change
in status for the five companies into a joint venture with PT
Telkom.
In October 1995, Telkom awarded 15-year joint-operation
contracts, popularly called KSO, to five Indonesian-foreign joint
ventures to install 2,256,487 telephone lines and operate them
along with existing lines.
In January 1996, Telkom officially handed over the management
and operation of the telecommunications networks outside Jakarta
to the five companies.
The five companies include: PT Pramindo Ikat Nusantara, which
is responsible for installing some 516,000 new telephone lines in
Sumatra; PT Aria West International, which will install 500,000
lines in West Java; PT Mitra Global Telekomunikasi Indonesia,
which will install 400,000 lines in Central Java; PT Daya Mitra
Malindo, which will install 237,000 lines in Kalimantan; and PT
Bukaka Singtel which will install 403,000 lines in the country's
eastern region covering Sulawesi, Maluku, Irian Jaya and Nusa
Tenggara.
The five projects are part of the government's program in
telecommunications development during the current Sixth Five-Year
Development Program which will end in March 1999.
Each of the joint-venture companies is responsible for
operating and managing telephone lines in its contract area for
15 years starting January 1996. They were each given only three
years to install the number of new lines specified in their
contracts.
During the contract period, the private firms are required to
pay minimum telkom revenues. A 30-percent portion of total
revenue will also go to Telkom.
But secretary-general of the Ministry of Tourism, Post and
Telecommunications Jonathan L. Parapak said over the weekend that
the government had not thought about altering the status of KSO
contractors.
Director General of Post and Telecommunications Djakaria
Purawidjaja said that under the telecommunications law the
involvement of private operators in the Indonesian
telecommunications industry was permitted only on condition that
such firms cooperated with state-owned companies under a joint-
operation, joint-venture or management agreement.
"There was the revenue-sharing scheme applied to the cellular
business, but it has been changed to a joint-venture scheme. Such
a scheme is the closest possibility of being adapted to KSO
contractors, but there has never been any discussion about that,"
he said.
The five KSO contractors, which held a regular meeting here
yesterday, refused to comment.
"We don't have any comment or information at this stage,"
spokesman for Aria West, Lawrence Chandra, said. (icn)