Small firms want telecoms role

JAKARTA (JP): Medium and small-scale telecommunications firms are keen to participate in the government's project to establish five million new telephone lines before the end of the current five-year development plan, an executive said yesterday.

Three million of the targeted lines, to be installed in Greater Jakarta and East Java, are to be installed by the state- owned domestic telecommunications operator PT Telkom, while the other two million are to be installed in other parts of the country by private companies under joint operating contracts with Telkom.

The government has selected five consortia, whose members signed joint-venture agreements in Bandung on Wednesday, to install the two million lines before the end of the sixth five- year plan, which will end in March 1999.

"The consortia are likely to look for major contractors for their projects and they apparently prefer to assign foreign companies," said Chairman of the Indonesian Association of Domestic Telecommunications Firms (Apnatel), Rahardjo Tjakranigrat.

The winners of the joint operating contracts are the Pramindo Ikat consortium, which is to install 516,000 lines in Sumatra; the Tiga-A consortium, (500,000 lines in West Java); the Mitra Global Telekomunikasi Indonesia (440,000 lines in Central Java); the Daya Mitra Malindo consortium (237,000 lines in Kalimantan); and the Bukaka Singtel consortium (403,000 lines in the eastern provinces).

The projects will start in Jan. 1996 under 15-year contracts which will expire on Dec. 21, 2010.

As required by the government, each of the consortia is led by a domestic firm and each consortium is providing 40 percent equity for its project.

"Even though the consortia are led by domestic firms, we know some of them are looking for foreign firms as their main contractors," Rahardjo said.

He suggested that the government require each of the consortia to divide their projects into five or six packages which could be carried out by medium and small-scale telecommunications-related firms.

"Apnatel is ready to support the projects by appointing a special team to coordinate cooperation," he said.

He said that by establishing partnerships with medium-sized and small companies to carry out projects the consortia could save 15 percent of the projects' projected cost.

Thomas B. Subijakto, a top executive of Pramindo Ikat, said that the appointment or non-appointment of small and medium-sized firms for work on the projects would depend wholly on the quality of their services. (icn)