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Jakarta Post

Java railway projects postponed amid budget cuts

  • Farida Susanty

    The Jakarta Post

Jakarta   /   Mon, June 13, 2016   /  10:18 am
Java railway projects postponed amid budget cuts

People in crowded Java may not be able to enjoy railway improvements just yet, as the government has postponed pipeline projects in the center of the country’s economic activities due to a state budget cut.

Instead, President Joko “Jokowi” Widodo has told the Transportation Ministry to prioritize railway projects outside Java, such as the ongoing trans-Sumatra and trans-Sulawesi projects.

The ministry will see Rp 3.7 trillion (US$277.2 million) of its original Rp 48.4 trillion budget allocated from the 2016 state budget cut on account of an expected tax income shortfall.

“Based on the President’s principal, the Java railway projects should be sacrificed for the ones outside of Java right now,” said Prasetyo Boeditjahjono, the ministry’s director general for railways.

President Jokowi’s administration is prioritizing railway construction to improve interconnectivity. The country has 5,196 kilometers worth of railways, most of
which were built under the Dutch colonial government, as railway construction received low priority in the past.

That has discouraged people from traveling on trains, with the total number of rail passengers increasing but only in Greater Jakarta, while in other parts of the archipelago the number has declined. On the other hand, air travel has gained momentum with skyrocketing passenger numbers, according to Central Statistics Agency (BPS) data quoted by recent research published by Bank Mandiri.

To up the game in rail transportation, the government aims to build 3,258 km of new railway tracks by the end of 2019, which will cost about
Rp 233 trillion, covering trans-Sumatra, double-track railways in southern Java, trans-Sulawesi, trans-Kalimantan and trans-Papua.

But the expected drop in state income from taxes against the backdrop of weak global and domestic activities has resulted in the railway plans falling short.

Double-track railway construction projects in the southern Java will be postponed, such as the Madiun-Kedungbanteng and the 76-km Kroya-Kutoarjo section. All Java railway projects, except for the 95-km Solo-Madiun section, were initially slated to commence this year and finish by at least 2019.

Railway development focus is now on trans-Sumatra and trans-Sulawesi, Prasetyo said, as the trans-Papua railway is also likely to see a groundbreaking delay owing to land procurement issues.

For the trans-Sulawesi megaproject, focus will be placed on the 145-km Makassar-Parepare section in South Sulawesi and the Manado-Bitung section in North Sulawesi, which are slated to finish construction by 2018.

“Makassar-Parepare was hampered by land procurement issues, but we aim to have at least half of the railway, 70-km, to be connected by 2017,” Prasetyo said, adding that construction had commenced on a 16-km section.

The trans-Sulawesi railway project, with six routes spanning 1,513 km, will require Rp 64.81 trillion. Meanwhile, the trans-Sumatra project, covering 1,520 km tracks, is estimated to cost Rp 77.6 trillion.

For trans-Sumatra, the government will focus on the Binjai-Besitang and Rantauprapat-Duri-Dumai tracks, as well as the Prabumulih-Kertapati double-track railway, among others.

Minister Ignasius Jonan previously said half of the 80-km revitalization plan for the Binjai-Besitang section had been completed in March.

As for railway construction financing, less than 27 percent will be covered by the state budget, while the remaining funds will be sought from the private sector.

China’s export and import bank has expressed interest in funding Indonesia’s railway development plans, having offered Rp 80 trillion for the trans-Sumatra and trans-Sulawesi railway projects.

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