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apan’s multi-billion-dollar deep sea port project in Patimban, West Java, has hit a new snag after the government slashed the limit of foreign loans that are allowed for the national strategic project.

The US$3.08 billion project was initially planned to receive $2.2 billion through a Japanese loan, while the remaining was to have come from the government. However, the National Development Planning Agency (Bappenas) slashed the limit of foreign loan participation into the project to just $1.7 billion, at least until 2019.

Bappenas’ deputy of development financing, Wismana Adi Suryabrata, said that the move was taken for administrative reasons, because the agency’s “Blue Book”, which lists foreign loans for government projects, will only apply until 2019.

Meanwhile, the Japanese loan for the rest of the construction phases after 2019 will be included in the next Blue Book.

“Basically it’s just work phases,” said Wismana. The Patimban project is divided into three phases, with the first having a port capacity of 3 to 4 million total equivalent units (TEUs) slated for completion in 2021. At the end of the project, Patimban port is expected to have a capacity of 7.5 million TEUs.

The Patimban deep-sea port project in Subang, West Java, is aimed at supporting the flow of goods to and from industrial estates in regencies east of Jakarta, such as Bekasi and Karawang, which are occupied by many Japanese companies.

It will serve as an alternative port to the already congested big ports, such as Tanjung Priok in Jakarta, the country’s largest port and a hub for more than 50 percent of goods shipped in and out of Indonesia. The government expects the new port to provide more ease in the distribution and traffic of the goods shipped in the country, which are plagued by staggering logistics costs.

During a bilateral meeting on the sidelines of the G7 summit on May, President Joko “Jokowi” Widodo also extended a guarantee to Japan Prime Minister Shinzo Abe that Japan could develop the project.

Japan has been conducting a feasibility study on the port since July, adding to the previous feasibility study on the project done by the Transportation Ministry because it deemed the Asian economic powerhouse as having no concrete plan for the port, despite high expectations from the previous bilateral agreement done by both of the countries’ leaders.

The Japanese Embassy’s counselor for information and culture, Kenichi Takeyama, said that Japan had not yet decided whether the port was feasible economically as the study was still ongoing.

“We have not even started with the investment calculation. That is still so far ahead,” he said, adding that the loan agreement had not been discussed as the current progress was limited to a physical study.

The government itself previously expected to sign the loan agreement for the project in April 2017. The project may get a soft loan, called Special Terms for Economic Partnership (STEP), with a 0.1 percent interest rate.

Transportation Ministry port director Mauritz HM Sibarani said that until now the government had not allocated its portion of the funding in the draft of the 2017 state budget in which Transportation Ministry would obtain Rp 48.7 trillion ($3.6 billion).

“We don’t even know how much of a loan we would get from Japan,” he said over the phone on Thursday.

Mauritz added that Japan itself had not finished the detailed engineering design (DED) for the project that would yield an exact investment figure. “I cannot answer before they finish the DED,” he said when asked about the government’s investment proportion in the project after Bappenas’ decision to slash the foreign loan limit for it.