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tate-owned airport operator Angkasa Pura II (AP II) has signed a loan agreement with state-run banks to finance a number of expansion projects for its airports, including a new international terminal.

Under the agreement, AP II obtained a non-syndicated loan facility worth a total Rp 2.1 trillion (US$156.5 million) from Bank Mandiri, Bank Negara Indonesia (BNI) and Bank Rakyat Indonesia (BRI) to finance expansion projects at several airports and the newly expanded Terminal 3 of Soekarno-Hatta International Airport in Tangerang, Banten.

AP II president director Budi Karya Sumadi said on Wednesday that the company, which manages 13 airports in the western part of Indonesia, was planning to expand and renovate several sites in a bid to increase connectivity between cities in the region.

This year, the company has the expansion of at least four airports in the pipeline with support from state-owned construction companies.

The company will need Rp 60.1 trillion by 2021 to support its expansion plans, with Rp 41 trillion of the total allocated for projects at Soekarno-Hatta airport, including the new Terminal 3 Ultimate.

The company expects that Soekarno-Hatta, which is the country'€™s largest and busiest international airport, will be able to compete with its counterparts in neighboring countries, such as Suvarnabhumi International Airport in Bangkok, Thailand, and Kuala Lumpur International Airport in Malaysia.

'€œSoekarno-Hatta airport has relatively small funds to compete with its counterparts in neighboring countries, but we will keep trying to improve its competitiveness as a major transit airport in the future,'€ Budi Karya said.

As part of the efforts, AP II will be ready to operate the first phase of the expanded Terminal 3 Ultimate in May as the construction has reached 93.9 percent completion, according to the company'€™s data.

The 42.2-hectare terminal will have a capacity of 15 million passengers in the first phase and 25 million passengers upon its full operation, which is expected to begin in February next year.

The expanded terminal is intended to ease traffic at the crowded Soekarno-Hatta airport, which can officially only accommodate 25 million passengers annually, yet currently welcomes over 62 million passengers each year.

National flag carrier Garuda Indonesia will move its flights to the new terminal by May, accompanied by SkyTeam international airlines, including Air France, China Airlines and Korean Air.

Speaking at the signing event, State-Owned Enterprises Minister Rini Soemarno said Terminal 3 Ultimate should have a level of quality on par with Singapore'€™s Changi International Airport, which is currently the largest transit airport in the ASEAN region.

Meanwhile, the president directors of the three state-owned banks said the loan for AP II was part of their commitment to supporting the country'€™s infrastructure development, which is also one of the major contributors to their total loans.

Bank Mandiri president director Budi Gunadi Sadikin said the lender had disbursed Rp 35 trillion in infrastructure loans as of last year, with Rp 3.2 trillion going to airport expansion projects.