Govt eyes water transportation system

Mustaqim Adamrah ,  The Jakarta Post ,  Jakarta   |  Thu, 08/28/2008 10:12 AM  |  Business

The government is inviting the private sector to assist it in developing an integrated system of river and railway-based transportation systems across the archipelago.

"We aim to develop a river transportation system by connecting rivers to rivers, rivers to a port, etc.," Dedy Supriadi Priatna, a deputy at the National Development Planning Agency (Bappenas), said Wednesday in a seminar.

"The government also plans to develop and manage an integrated system of land transportation and railway-based transportation and combine both systems with a river transportation system."

The water infrastructure development projects form parts of the 2005-2009 national infrastructure program which requires a massive US$65 billion in investment -- although none of the funds have been allocated to waterway projects.

According to Dedy, the government invested Rp 19.68 trillion ($2.14 billion) in 2005, Rp 34.32 trillion in 2006, Rp 44.13 trillion in 2007 and Rp 61.92 trillion in 2008, and has proposed Rp 62.58 trillion for next year, to finance the projects across the archipelago.

"The government is short more than $40 billion, which it hopes can be filled in by the private sector," he told the seminar attended by representatives of local administrations, including South Sumatra, Central Kalimantan and Papua, as well as water transportation experts.

In a region seeing the kind of development envisioned by the government, a river transportation system would ship products from, for example, mining, plantation and forest sites to a port, Dedy said.

To guarantee that rivers used in an integrated transportation system were sustainable, local administrations should engage private partners for river maintenance and management.

"We are in dire need of huge investment from the private sector to carry out these plans," he said.

To lure potential investors, Dedy said, the government was offering a set of possible incentives, including tax cuts, interest subsidies, revenue shortfall guarantees and ease in the issuance of permits.

Poor infrastructure has long been blamed for impeding business development and, hence, economic growth. With numerous big rivers running across the country's largest islands, the government hopes to see river infrastructure development boost local economies.

Copyright © 2008 The Jakarta Post - PT Bina Media Tenggara. All Rights Reserved.