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High-speed railway project sees slow equity contribution
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Megaproject: President Joko "Jokowi" Widodo (center) gestures as he inspects a model of the high-speed train which will connect the capital city of Jakarta to the country's fourth largest city, Bandung, during the groundbreaking ceremony for the construction of its railway in Cikalong Wetan, West Java, on Jan. 21. (AP Photo/Dita Alangkara)
W
ith only a few days remaining before year-end, state railway operator Kereta Api Indonesia (KAI) stated that it was yet to fully transfer its equity contribution for this year for the construction of the 142.3-kilometer high-speed railway connecting Jakarta and the West Java capital of Bandung.
KAI is a member of the consortium of Indonesian firms that have formed a joint venture Kereta Cepat Indonesia China (KCIC) with their Chinese counterparts. The KCIC is in charge of building the Jakarta–Bandung high-speed railway.
Equity transfer from consortium members is required to help the consortium secure the loan from the Chinese Development Bank (CDB), which is expected to cover around 75 percent of the US$5.1 billion worth of investment needed to complete the project.
(Read also: Indonesia’s first high-speed railway may be costlier on design change)
Speaking to The Jakarta Post on Wednesday, KAI finance director Didiek Hartantyo said the company was supposed to transfer Rp 478 billion ($35.4 million) this year, but so far had only managed to transfer around 40 percent of the figure.
“The other state-owned enterprises [in the consortium] also did the same thing,” he said, mentioning construction firm Wijaya Karya and toll road operator Jasa Marga as examples.
KAI, Didiek continued, was expected to transfer another Rp 956 billion for the joint venture equity. (hwa)
