Investment in Railways Outside Java Requires Rp 1,200 Trillion
The government is promoting the development of the railway network outside Java Island as part of efforts to strengthen national connectivity. Coordinating Minister for Infrastructure and Regional Development Agus Harimurti Yudhoyono stated that the project requires substantial investment of up to Rp 1,100 to Rp 1,200 trillion until 2045.
According to Agus, the development includes the construction of new networks and the reactivation of routes, with a total addition of around 14,000 kilometres to be built in Sumatra, Kalimantan, and Sulawesi.
“The figure is indeed large, but this is a long-term investment for Indonesia’s future. We cannot rely solely on the state budget,” said Agus, quoted from a written statement on Wednesday, 22 April 2026.
He stated that the project is a direct mandate from President Prabowo Subianto within the framework of the National Priority Work Programme (PKPN), particularly for the infrastructure and connectivity sector. The government is encouraging creative financing schemes, including collaboration with the private sector, to realise the project.
Agus assessed that developing the railway network outside Java is important to reduce logistics costs, lessen inter-regional disparities, and increase economic competitiveness. Currently, the contribution of railways to national mobility is still relatively small, at around 4 percent for passenger transport and 1 percent for logistics.
“However, railways have advantages in terms of efficiency and emissions. Their contribution to greenhouse gas emissions is even less than 1 percent,” he said.
He also highlighted the significant disparity in investment between road and railway development. According to him, this situation needs to be corrected so that national transport development is more balanced.
The General Chairman of the Democrat Party added that in its implementation, each region has different challenges. Sumatra needs strengthening of existing networks, Kalimantan requires building from scratch, while Sulawesi needs integration with industrial areas and flagship commodities.
However, several major challenges still loom over the project. Executive Director of the Institute for Transportation Studies (Instran) Deddy Herlambang assessed that land acquisition is one of the main obstacles, especially for projects with new routes. “Because there are many new routes, the projects are hampered by land acquisition,” he said.
In addition, he emphasised the importance of environmental impact analysis (AMDAL) so that development does not cause conflicts with the community. Deddy also reminded the government to be cautious in funding schemes given the large investment needs.
Meanwhile, Chairman of the Railways Division of the Indonesian Transport Society (MTI) Aditya Dwi Laksana assessed that developing railways outside Java is indeed important for equity. However, he reminded that the main challenges remain in land procurement and financing.
He added that the government needs to ensure sufficient demand, both from passengers and logistics, so that the project does not become stranded. Experiences from several suboptimal projects in Java serve as important notes for future development.
“If using a government and business entity cooperation scheme, the government must prepare clear business calculations,” said Aditya.