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Jakarta Post

KCIC given green light to begin railway construction

  • Farida Susanty and Arya Dipa

    The Jakarta Post

Jakarta/Bandung   /   Mon, March 21, 2016   /  06:48 am

The Indonesia-China joint venture company PT Kereta Cepat Indonesia China (KCIC) is gearing up to start developing the country'€™s first high-speed railway as the Transportation Ministry issued the construction permit for the project on Friday.

The permit, however, only allows KCIC to build the first 5 kilometers of the 142.3-km railway that will connect Jakarta and Bandung, West Java. The company is now working on the necessary documents and plans to apply for the construction permit for the remainder of the project in early April.

Given the number of documents and complexity of the requirements, it is likely to take years for KCIC to fully complete the ambitious project.

KCIC president director Hanggoro Budi Wiryawan said that even though the government had issued the required permits to start the project, KCIC still needed to coordinate with the National Police and regional administrations in the regencies the rail track will pass through.

'€œWe'€™ve already got the permit, but it'€™s not the only one we need,'€ Hanggoro said on Sunday.

He estimated that construction of the first 5 km of the railway could start in one or two weeks. As of Sunday, however, the company was yet to start recruiting workers due to the previous uncertainty regarding the permit issuance.

KCIC, which consists of the China Railway Corporation and a consortium of four Indonesian state-owned companies, including construction firm Wijaya Karya and toll operator Jasa Marga, pocketed three crucial permits last week.

On Wednesday, KCIC secured a concession deal with the Transportation Ministry, which gives the joint venture the right to operate the Jakarta-Bandung railway line for a period of 50 years, starting from May 31, 2019.

The company estimates that it will break even within 40 years.

The concession deal also gives KCIC the authority to approve or disapprove of other high-speed railway operators that intend to use its track, signaling that the ministry had approved its exclusive right demand.

In addition to the construction permit, KCIC was also given the railway infrastructure business permit on Thursday. The permit will be valid for 30 years and can be extended for another 20 years.

With the permit, KCIC is obliged to finish the technical planning, environmental impact analysis (Amdal), land procurement and apply for the railway infrastructure construction permit within three years.

The ministry'€™s director general for railways Hermanto Dwiatmoko said the permit could be revoked if KCIC failed to comply with the requirements or defaulted.

Transportation Minister Ignasius Jonan earlier said the KCIC needed to secure other permits at the regional level, such as the building permit (IMB), as well as purchasing the necessary land.

The company plans to purchase 600 hectares of land for the project, including an area to substitute a production forest area in Karawang, West Java, and an area to substitute a plot of land belonging to the light rail transit (LRT) project in Cikunir, West Java.

The KCIC also plans to build a rolling stock plant in West Java. However, West Java provincial administration secretary Iwa Karniwa said he had not yet received the proposal for the rolling stock plant project.

'€œSo far the consortium has not informed the provincial administration on the exact location of the plant,'€ he said, adding that there had been an ongoing process in Purwakarta.

Previously, Purwakarta regent Dedi Mulyadi offered 1,200 hectares of land for the rolling stock plant to be built in Sukatani or Bungursari.

Based on the agreement, KCIC is obliged to adjust the construction based on the provincial spatial planning (RTRW) recommendations. The company also needs to file a report every three months to the minister and the regional heads.

The Jakarta-Bandung railway project is estimated to cost US$5.1 billion, with more than half of that amount funded by the China Development Bank. It will stop at four stations, namely Halim, Karawang, Walini and Tegalluar.

In accordance with the final agreement, the railway will allow trains to reach speeds of up to 250 km per hour, lower than the previously estimated 350 km per hour.

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