The government has announced that it was considering asking state construction firm Adhi Karya, contractor of the light rail transit (LRT) project in Greater Jakarta, to also invest in the project due to the cash-strapped budget.
Coordinating Maritime Affairs Minister Luhut Binsar Pandjaitan said the government was looking for a “flexible way to fund the LRT”.
“So Adhi Karya may not just be the one driving it forward [as the contractor], but also as an investor,” he said on Tuesday.
Luhut reiterated that the project should be finished by 2019, even though the government so far has not come up with a solution for paying Adhi Karya back.
According to a recently revised 2016 Presidential Regulation on the LRT, the government has appointed Adhi Karya to build the project and will fund the LRT from the Transportation Ministry’s budget.
The regulation stipulates that all process until the contract signing must be completed within 120 days or four months from the regulation being passed in July 2016.
However, neither party has signed the contract as the legal basis of the budget disbursement until now, leaving Adhi to rely on its internal cash. (bbn)