PT KAI eviction plan opposed
Yuli Tri Suwarni, Bandung
With their departure just a matter of time, thousands of people living on unused land across the country that belongings to state railway company PT KAI have been struggling for fair compensation.
PT KAI is studying the possibility of inviting developers to cooperate under a build-and-operate (KSO) arrangement, which will allow the private sector to lease the plots under a long-term contract.
Revenues from the scheme would be needed to cover the firm's Rp 134 billion (US$15.7 million) in annual losses. Its deficit as of the first semester of 2003 stood at Rp 85.06 billion, according to KAI director Omar Berto.
The losses were mainly attributed to fierce competition that has faced PT KAI, particularly after many airline companies lowered fares and overland cargo companies improved services.
The plots, covering a total of 670,000 square meters, are located in 24 towns, including Bandung, Jakarta, Surabaya and Bukittinggi in West Sumatra.
Twenty developers have shown interest in the plots offered by PT KAI. In Surabaya, they have proposed construction of a shopping center on Jl. Semut Baru, Jl. Johar and Jl. Gundih and shopping and office blocks in the old Semut, Pasar Turi and Wonokromo railway stations.
In Semarang, developers plan to build a container terminal on Jl. Ronggowarsito and a hotel in the former Lawangsewu building.
A super block on 135,000 square meters of land, consisting of apartment blocks, a hotel and a shopping mall, will also be built in Bandung, plus renovation of a hotel and a mall on a 65,000 square meter plot of land to replace Bandung station.
The projects, however, are facing resistance. Protests from people who have been living on the company's land have been commonplace.
Hundreds of residents in Kebon Jeruk subdistrict in Bandung have, since early May, been demanding higher compensation for their departure. The squabbling is dragging on although the developer has obtained the required permits and the Environmental Impact Assessment (Amdal) certificate.
The developer has offered Rp 125,000 per square meter for a nonpermanent building and Rp 210,000 per square meter for a permanent building.
A resident, Rahmat, 50, who has been living in the area for about 40 years, said the compensation was too small to buy a plot of land or build a house in another area.
He said he had spent tens of millions of rupiah on building his house. Some of his neighbors claimed even to have spent Rp 100 million.
"PT KAI should at least pay half the amount the residents have spent on their housing," he said.
PT KAI spokesman Noor Hamidi took the complaints lightly.
"They should thank the developer for being willing to pay compensation. We could just confiscate the land if necessary. Those people have signed an agreement," said Hamidi.
He said the residents had leased the land for only Rp 1,600 per square meter per year, which he said was a derisory amount.
Without much effort, PT KAI stands to gain Rp 55.1 billion for leasing 17 hectares of land in Kebon Jeruk under a 34-year contract, after evicting 1,500 families.
He said as the railway transportation business was no longer lucrative, the firm was trying to benefit from its assets as their main money-spinner. The additional income could cover the losses in the railway operations.
"We must do our utmost to keep the railway service intact. Middle- and lower-income people who depend a great deal on train services would bear the brunt if we were unable to operate anymore," he said.