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Jakarta Post

Infrastructure funds planned for capital

The 30 million residents of Greater Jakarta can hope to enjoy improved mobility in the future with the government agreeing to accelerate infrastructure development through a 10-year plan worth Rp 571 trillion (US$40

Sausan Atika (The Jakarta Post)
Jakarta
Thu, March 21, 2019

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Infrastructure funds planned for capital

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div>The 30 million residents of Greater Jakarta can hope to enjoy improved mobility in the future with the government agreeing to accelerate infrastructure development through a 10-year plan worth Rp 571 trillion (US$40.8 billion) in Jakarta and its satellite cities.

President Joko “Jokowi” Widodo said the government approved the plan after it was proposed by the Jakarta administration during a limited Cabinet meeting on Tuesday, following a similar meeting held in January.

The infrastructure projects cover transportation, clean water and sanitation, housing and flood control.

Jakarta Governor Anies Baswedan said on Wednesday that to realize the plan, in particular for transportation infrastructure development, multiple institutions would need to be involved, including state-owned companies and regional administrations outside Jakarta, thus requiring the government’s involvement.

The aforementioned institutions include state-owned commuter line operator PT KCI and state-owned airport operator PT Railink.

“Yesterday we talked about the need for [transportation] integration. Therefore, we need the government’s involvement because it is the President who will allocate the authorities,” Anies said.

When asked about the financing scheme, he said the projects would be funded by a variety of methods with the largest portion likely to come from loans.

“We haven’t reached there [discussion on financing] yet. Some of the funds will be from loans, some from the state-budget, but the largest portion will be from loans,” he said.

Anies expressed optimism the city administration would be able to pay off the loan. “For instance, Jakarta could pay off a 30-year loan with such a value,” he said.

The governor explained that the proposed budget would be allocated for, among other sectors, the transportation sector, including for the development of 231 kilometers of MRT tracks.

The MRT tracks will include the development of MRT Jakarta phase two that is expected to run from Hotel Indonesia traffic circle station in Central Jakarta to Kota in West Jakarta, as well as the east-west MRT line from Ujung Menteng in Central Jakarta to Kalideres in West Jakarta and the 100 km loop route, according to city-owned transportation company MRT Jakarta.

The projects will also include more than 120 km of LRT tracks and the elevation of 27 km of the existing commuter line railway.

The acceleration plan is also aimed at achieving 100 percent clean water supply coverage from the current 60 percent, expanding the domestic sewerage system as planned in the Jakarta Sewerage System project, building housing and improving flood control mechanisms.

The city administration was currently preparing a task force to follow up the planned projects, Jakarta economic and finance secretary assistant Sri Haryati told The Jakarta Post on Wednesday.

“The administration will establish a task force that will cooperate with related ministries [which] might establish their own teams as well,” she said. “[Task forces] will discuss the regulations, financing, technical aspects, etc. Pak Jokowi has asked the ministries to support [the projects].”

Jakarta Council Deputy Speaker M. Taufik from the Gerindra Party said he supported the idea but said the plan should be discussed with the City Council, particular in regards to the financing scheme.

“Yes, [I support] integration but it must be clear what falls under the authority of the central government and the Jakarta administration,” he said.

Taufik cited the MRT Jakarta financing scheme as an example in which the funding was shared by the government and the administration but with the latter being required to carry the burden of the subsidies.

Infrastructure Society chairman Harun Alrasyid Lubis warned that all relevant stakeholders needed to work hard if they wanted to realize such massive projects.

He highlighted Presidential Regulation No. 55/2018 on the Greater Jakarta transportation master plan, which lays out the goal to have 60 percent of commuters use public transportation. To reach the target, he said the government would need to construct more than 100 km of railway per year to carry 1 million more passengers per day.

“To add 1 million passengers to the daily carrying capacity each year for a total of 10 years seems impossible,” he said. “Therefore, there must be other efforts to help reach the target such as electronic road pricing [ERP], parking controls and transit-oriented developments [TOD].”

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