The Asian Development Bank is optimistic the first installment of soft loans for the Integrated Citarum Water Resources Management Project (ICWRMP), approved Dec. 4, will benefit many people, says an ADB engineer.
The first US$50 million tranche of the loan will largely be earmarked to improve 54.2 kilometers of the West Tarum Canal in Karawang and Bekasi regencies in West Java beginning next year.
The loan is the first from the ADB to Indonesia in the form of a multitranche loan facility (MLF) since the multilateral lender first provided assistance to the country in 1969. The first tranche provides $30 million in soft loans and $20 million in commercial loans.
The ADB commitment is to lend $500 million for ICWRMP over the next 15 years. MLFs are used to finance long-term projects with manageable benchmarks, reducing transaction costs for the borrowing country, spokesperson for ADB Indonesia, Ayun Sundari, told The Jakarta Post over the phone in Jakarta.
In Bandung, Christopher Morris, senior water resources engineer at ADB's Southeast Asia regional office, said the West Tarum Canal project topped ADB's list of priorities because it was relatively easy to carry out and residents living along the river could immediately benefit from the project, especially those in Karawang, Bekasi and Jakarta.
"Within the framework of this project, the government and community will be able to work together to create productive, healthy, and clean catchment areas and rivers," Morris told journalists Thursday.
Immediate benefits provided by the project include the provision of additional water volume for the irrigation of 25,000 hectares of farmland in Karawang and Bekasi and additional clean water supply for 200,000 households in Jakarta.
Morris said 872 residences and 20 government facilities would benefit from the project.
Addressing eminent domain issues, Morris said every property affected was state-owned and no evictions would take place. He said land compensation would be provided by the provincial administration under strict supervision by the ADB.
Morris said ADB had also prioritized restoration efforts along the upper reaches of the Citarum, the longest river in West Java. Fifteen restoration projects are to be funded out of the first tranche.
Other projects include biodiversity and water supply restoration along the Citarum river basin areas, water management in south Bandung, public sanitation projects and construction of waste facilities.
"The loan agreement covers all aspects including environmental protection and resettlement," Morris said.
Separately, the head of West Java's section of state-owned forestry company Perhutani, Komarudin, said compromised land in the Citarum river basin areas had reached 728,000 hectares, 600,000 ha of which lie within Perhutani's jurisdiction.
Forest conversion in the upper courses of the Citarum, Komarudin said, was the main cause of worsening floods in the Bandung basin area.
"As long as the upper reaches of the Citarum are unforested and still used for growing vegetables, floods will prevail," said Komarudin.
"We see no other way to overcome the floods except to buy the land and reforest it."
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