State-owned railway operator PT KAI and airport train operator PT Railink have secured funds from four major lenders to finance the construction of the much-awaited Soekarno-Hatta International Airport railroad.

The companies signed on Monday two syndicated loan facilities with state-owned lenders Bank Negara Indonesia (BNI), Bank Rakyat Indonesia (BRI), Bank Mandiri and private lender Bank Central Asia (BCA).

The amount of loans channeled to KAI stands at Rp 1.45 trillion (US$112 million) and will mature after 14 years.

Each bank will equally disburse Rp 362.27 billion to KAI. The facility itself carries a Jakarta Interbank Offered Rate (JIBOR) plus an annual interest rate of 3 percent.

Meanwhile, the loans to Railink '€” a joint venture between KAI and airport operator PT Angkasa Pura II (AP II) '€” amount to Rp 612 billion.

Similar to the facility provided to KAI, the facility to Railink will mature after 14 years and carries a JIBOR plus 3 percent annual interest rate as well. Each bank will disburse Rp 153 billion to Railink.

There is a four-year grace period within the 14-year tenor offered in both facilities, according to the loan details.

KAI finance director Kurniadi Atmosasmito said that funds from the loans would cover 84 percent of the project costs that KAI was currently in charge of. '€œThe rest of the costs will be financed by our own cash flow,'€ he said in a press conference.

According to the project design, the airport track will connect Manggarai train station in South Jakarta with Soekarno-Hatta International Airport in Cengkareng, Banten province, northwest of Jakarta.

The whole track will run across a 36.3-kilometer line, but at present, only a 24.2 km long track exists.

KAI is responsible for acquiring land for the additional 12.1 km track, expanding existing stations to facilitate travelers and developing new railway signals.

It plans to renovate Manggarai Station and equip it with a separate underpass and platform. It is also looking to expand the Sudirman train station in Central Jakarta and add a specific section to accommodate the travelers.

'€œWe partnered with the local administration, the BPN [National Land Agency] and AP II for the land [clearing] matter. Problems surrounding it have been solved. We are now waiting for the BPN to issue the land certificate,'€ Kurniadi said.

Railink president director Heru Kuswanto, meanwhile, said the company could now finance 85 percent of the total costs, supported by the facility. It has ordered 10 trains, each equipped with six cars, to serve the track.

'€œConstruction of the trains will take 14 months to complete,'€ he said, adding that operations of the new railway were expected to commence in 2016.

If realized, the Soekarno-Hatta will become the second airport in the country with its own railway, after the Kualanamu International Airport in Deli Serdang, North Sumatra province.

Kurniadi said that there were plans to develop railway tracks for other airports as well, but added that no definite plan was in place.

Separately, AP II finance director Andra Y. Agussalam said that the company had allocated as much as Rp 140 billion to establish a train station within the Soekarno-Hatta airport complex.

He added that construction was under way and ensured that it would be completed before the whole railway project concluded.

'€œPart of the construction will also include automated people movers that will transport travelers from one terminal to the others,'€ Andra said.

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