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onstruction of the Jakarta-Bandung high-speed railway project faced further uncertainty on Tuesday as the Transportation Ministry said it would not grant PT Kereta Cepat Indonesia China (KCIC) exclusive rights to operate the 142-kilometer railway.

KCIC, a consortium consisting of China Railway Corporation and four Indonesian state-owned companies, had demanded exclusive rights to the railway to ensure business certainty. However, Transportation Minister Ignasius Jonan insisted such exclusivity would not be granted to the company.

'€œWhy should exclusive rights not be granted? Just read the [2007] Railway Law, which stipulates that no public railways are entitled to such exclusive rights,'€ Jonan said at a press conference, which was also attended by KCIC president director Hanggoro Budi Wiryawan.

The minister, however, left room for negotiations, particularly on the distance between stations built by KCIC and those of other companies that may have an interest in using the Jakarta-Bandung rail track in the future.

Jonan said his ministry was also open to negotiate the length of concession given to KCIC to operate the rail track.

The ministry earlier said the government was considering building a Jakarta-Surabaya high-speed railway next to the Jakarta-Bandung rail track. If the government granted exclusive rights to KCIC, the firm could fully control the track or charge other rail companies using it.

Aside from the arguments on exclusivity, KCIC and the ministry were also of different opinions on the length of the concession.

While KCIC wants the concession be calculated only after the commercial operation of the railway begins, the government says the concession should be calculated from its issuance '€” ie from the start of the railway construction.

Jonan also demanded that KCIC submit a revised feasibility study as a requirement to determine the concession timeline, as well as to include an independent review of the revised feasibility study from a third party.

'€œIn principle, the concession can begin at the same time as the commercial operation. However, there must be a time limit for the construction,'€ Jonan said, adding that KCIC needed to provide a clear length for the construction process.

Therefore, if there were delays in the construction, the lost time needed to be included in the concession period, he added.

KCIC has predicted that fares for the high-speed railway will be around Rp 200,000 (US$14.68), with an expected 28,000 passengers on 50 trips daily. Based on KCIC'€™s calculations, the company will reach break-even point in 40 years, hence the proposed concession period is 50 years.

After the concession period was over, Jonan said, the company would have to hand the project over to the country, debt-free and properly functioning.

Any bank loan the KCIC might use to fund the construction project '€” which will be mostly financed by loans from the China Development Bank, with the rest sourced from KCIC'€™s capital '€” must have been settled within the concession period, he added.

The Jakarta-Bandung high-speed railway has been listed as a priority for President Joko '€œJokowi'€ Widodo'€™s administration and is therefore entitled to special treatment from the government.

Meanwhile, Hanggoro said KCIC was still working on the revision of the feasibility study and the concession deal, adding that they might be ready to be submitted to Jonan within the next month or two.

However, Hanggoro stopped short of commenting on whether the company agreed with Jonan'€™s statement.