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Government to only partially fund Makassar-Parepare railway
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State-owned Enterprises (SoE) Minister Rini Soemarno (left), Transportation Minister Budi Karya (center) and acting Jakarta governor Soemarsono inspect the progress of the Soekarno-Hatta Airport train station, in Tangerang, Banten, on March 12. The transportation minister says the government can only partially fund the development of the Makassar-Parepare railway this year because of a tight state budget. (JP/dra)
T
he government will only partially fund the development of the Makassar-Parepare railway in South Sulawesi that may cost Rp 15 trillion (US$1.13 billion).
Transportation Minister Budi Karya Sumadi said Monday that with the 2017 state budget, it could afford financing the construction of 30 kilometers, 20 percent out of the total 146-km. The remaining would be handed over to either state-owned enterprises or private firms, he added.
“[The developer] It should not be [state-owned railway operator] KAI. It can also be carried out by private [firms],” Budi said as quoted by tempo.co.
(Read also: Budget cuts to hit projects)
Budi, however, said the government would support future operation of the railway, such as through public service obligation (PSO).
Under the PSO, it may subsidize trip fares to make them affordable for passengers.
The Makassar-Parepare railway is part of the trans-Sulawesi railway project that will span 1,700-km from Makassar, South Sulawesi to Manado, North Sulawesi. The vast railway network is set to commence operations in 2018. (lnd)
