Telkom to build more phone lines but below set target

JAKARTA (JP): State-owned telecommunications operator PT Telkom said over the weekend that the company and its partners would install at least 1.4 million telephone lines this year but would still not achieve the government's five-year target.

Telkom's marketing director, Dadad Kustiwa, said in Semarang, Central Java, that the monetary crisis would make it difficult for Telkom and its five private partners to install eight million telephone lines in the current Sixth Five-Year Development Plan, which ends in March 1999.

"The monetary condition is not favorable for telecommunications companies, including Telkom, because most investment is still made in U.S. dollars," he told Bisnis Indonesia daily.

The rupiah has lost more than 60 percent of its value against the dollar since early July, when the crisis began.

In 1996, the government raised its telephone installation target from five million to eight million telephone lines for the plan, including 6.7 million fixed-telephone lines and a network capacity for 1.3 million mobile telephones.

Telkom and its private partners have installed about four million lines since the beginning of the plan in April 1994.

The five private firms were awarded 15-year concessions by Telkom to install 2.2 million lines from January 1996 to March 1998, but had only installed 1.1 million toward the end of 1997, Dadad said.

"The figure is far below the target set by the government," he said.

In January 1996, Telkom handed over the management of its telecommunications networks in Sumatra, Kalimantan, West and Central Java, Sulawesi, Maluku, Irian Jaya and Nusa Tenggara to five companies under joint-operation contracts.

In addition to installing telephone lines, the five firms are required to manage them and existing lines until 2010. Telkom is to install, operate and manage at least three million lines in Greater Jakarta and East Java.

The five private firms, each a joint venture between domestic and overseas operators, are PT Pramindo Ikat Nusantara, which is responsible for installing 500,000 new lines in Sumatra; PT Aria West International, 500,000 lines in West Java; PT Mitra Global Telekomunikasi Indonesia, 400,000 lines in Central Java; PT Daya Mitra Telekomunikasi Mitratel, 237,000 lines in Kalimantan; and PT Bukaka Singtel, 403,000 lines in eastern Indonesia.

The president of PT Mitra Global Telekomunikasi Indonesia, Eddy Hadijanto, said his company had installed 270,000 lines since 1996, below the target of 400,000 lines set by the government.

"There are 130,000 more telephone lines to be installed. But it will be difficult to reach this due to the economic crisis," Hadijanto said.

Minister of Tourism, Post and Telecommunication Joop Ave said separately on Friday that Indonesia had 7.9 million telephone lines as of the end of 1997, comprising 6.9 million fixed- telephone lines and a network capacity for 1 million mobile phones.

He said that he was optimistic that Telkom and its partners could install more than five million lines by the end of the plan. (gis)