Plan to import buses from China delayed

JAKARTA (JP): The city administration's plan to import cheap buses from China will likely be delayed until the Ministry of Industry and Trade agrees to lower the import duty, an official has said.

The City Land Transportation Agency chief, Buyung Atang, told The Jakarta Post on Saturday that until now, the ministry had yet to agree to lower the import duty from 40 percent to 10 percent (of the price of the bus).

As part of its efforts to improve public transportation services, the administration plans to purchase 3,000 buses, comprising 54-seat buses and 26-seat minibuses from the People's Republic of China. The prices of the vehicles are Rp 250 million (US$29,760) and Rp 160 million each.

The city administration has officially asked the Ministry of Industry and Trade for (tax) special treatment. Governor Sutiyoso also has plans to meet Minister of Industry and Trade Luhut B Panjaitan to discuss the matter.

According to regulations, it is the Ministry of Finance that has the authority to approve or reject the special tax treatment proposed by the Ministry of Industry and Trade following the administration's request.

The administration has appointed private company PT Dayu Bahtara Kurnia to oversee the purchase and the shipment of the Chinese-made vehicles.

"We cannot proceed with the plan to purchase the buses," Buyung said. The buses were previously expected to arrive in December.

However, Buyung said he was still upbeat that the approval for the special import duty would be issued "hopefully before the end of this year. We hope that the first 1,000 buses will arrive in December."

Currently, there are 3,584 public buses which have been operating for between 15 years and 20 years in the city. The old buses belong to 14 private companies, which are obliged to improve their fleets. The companies would be burdened by the high import duty for the Chinese buses.

In a related development, the Organization of Land Transportation Owners' Jakarta chapter chairman Aip Sjarifuddin said a taxi fare hike would most probably come into effect before the fasting month, which starts on Nov. 27.

"Maybe the effective date will be in the second week of November," Aip told the Post.

"As soon as the governor approves our proposal (on the fare increase), a joint meeting with the 32 taxi companies will be held," Aip said. (dja)