Former vice president Jusuf Kalla has called for an inquiry into allegations that the Indonesian government bought 15 Chinese-made MA-60 commuter aircraft for marked-up prices.

He also said the purchase of the aircraft was not connected to a contract with Chinese companies to build power plants in Indonesia as part of the 10,000 megawatt power program.

Asked to comment on the issue after receiving People’s Consultative Assembly chairman Taufiq Kiemas and his entourage at his residence in South Jakarta on Wednesday, Kalla said he had no longer been in power when the 15 planes were handed over to Indonesia.

“We should not create suspicion about the deal, but it is better for the government to carry out an objective inquiry into it because the total price paid to China was higher than the market price,” he said.

Kalla, who is chairman of the Indonesian Red Cross and former chairman of the Golkar Party, revealed that when the deal was signed in 2006, the MA-60 propeller planes produced by Xian Aircraft Co and Ltd cost US$11.2 million per unit, which would imply a total price of around $160 million, but the government paid $220 million through a loan agreement with Exim Bank of China.

Public curiosity over the purchase of the aircraft intensified recently after one of the 15 aircraft, operated by state-owned Merpati Nusantara Airlines, crashed in Kaimana Bay in West Papua last Saturday. All 27 passengers and crew on board were killed in the accident.

Indonesian Development Monitoring executive director Munatsir Mustaman said that officials at the State Enterprise Ministry, the National Development Planning Agency (Bappenas) and the Trade Ministry had committed corruption because the planes’ prices had been marked up to $14.3 million per unit from the previously agreed $11.2 million.

According to reliable sources, Kalla proposed to review the government’s decision to purchase the 15 aircraft because the price was too costly, but finally gave up when China threatened to suspend its involvement in the first stage of the 10,000 megawatt project.

President Susilo Bambang Yudho yono will meet with his ministers today about the Merpati Nusantara crash.

All relevant ministers have been asked to report on the accident, National Development Planning Minister and Bappenas head Armida S. Alisjahbana said on Wednesday.

“I can’t say more. There will be several ministers, including the finance minister and state-owned enterprises minister, who dealt with the aircraft,” she said.

Commission XI deputy spokesman Harry Azhar Azis questioned the procedure by which the government organized the loan to purchase the aircraft for PT Merpati Nusantara Airline, which involved the issuance of a subsidiary loan agreement (SLA) by the government.

“As far as I know, an SLA should be approved by the commission before its issuance. To my knowledge, [state electricity company] PLN as well as others are still asking for our approval,” he said in a meeting between commission XI and parties involved in the purchase of the MA-60 aircraft.

Another commission XI member said that the procedural steps taken by Merpati and the government were against the law.

“There should be a House approval first and then a contract. This violates the law,” he said. (awd)

Popular

To my horror, it’s just a movie!

RI, Australia strengthen partnership on taxing crypto assets

Pentagon chief congratulates Prabowo on being elected President