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Categories Skip Nav Destination Article navigation PROCEEDINGS OF THE 3RD INTERNATIONAL CONFERENCE ON CONSTRUCTION AND BUILDING ENGINEERING ICONBUILD 2017 Smart Construction Towards Global Challenges14–17 August 2017Palembang, Indonesia Previous Article Next Article Research Article November 14 2017 Aleksander Purba; 1Civil Engineering Department, Faculty of Engineering, Lampung University, Jalan Sumantri Brojonegoro No 1 Gedung Meneng, Bandar Lampung 35145, Indonesia Search for other works by this author on Fumihiko Nakamura; 2Graduate School of Urban Innovation, Yokohama National University, 79-1 Tokiwadai, Hodogaya-ku, Yokohama 240-8501, Japan Search for other works by this author on Chatarina Niken DWSBU; 3Civil Engineering Department, Faculty of Engineering, Lampung University, Jalan Sumantri Brojonegoro No 1 Gedung Meneng, Bandar Lampung 35145, Indonesia Search for other works by this author on Muhammad Jafri; 4Civil Engineering Department, Faculty of Engineering, Lampung University, Jalan Sumantri Brojonegoro No 1 Gedung Meneng, Bandar Lampung 35145, Indonesia Search for other works by this author on Priyo Pratomo 5Civil Engineering Department, Faculty of Engineering, Lampung University, Jalan Sumantri Brojonegoro No 1 Gedung Meneng, Bandar Lampung 35145, Indonesia Search for other works by this author on AIP Conference Proceedings 1903, 060004 2017 Split-Screen Views Icon Views Article contents Figures & tables Video Audio Supplementary Data Peer Review Open the PDF for in another window Tools Icon Tools Search Site High-Speed Railways HSR is currently regarded as one of the most significant technological breakthroughs in passenger transportation developed in the second half of the 20th century. At the beginning of 2008, there were about 10,000 kilometers of new high-speed lines in operation in Asia and Europe regions to provide high-speed services to passengers willing to pay for lower travel time and quality improvement in rail transport. And since 2010, HSR itself has received a great deal of attention in Indonesia. Some transportation analysts contend that Indonesia, particularly Java and Sumatera islands need a high-speed rail network to be economically competitive with countries in Asia and Europe. On April 2016, Indonesia-China consortium Kereta Cepat Indonesia China KCIC signed an engineering, procurement, and construction contract to build the HSR with a consortium of seven companies called the High-Speed Railway Contractor Consortium. The HSR is expected to debut by May 2019, offering a 45-minute trip covering a roughly 150 km route. However, building, maintaining and operating HSR line is expensive; it involves a significant amount of sunk costs and may substantially compromise both the transport policy of a country and the development of its transport sector for decades. The main objective of this paper is to discuss some characteristics of the HSR services from an economic viewpoint, while simultaneously developing an empirical framework that should help us to understand, in more detail, the factors determining the success of the HSR as transport alternative based on current experiences of selected Asian and European countries. REFERENCES de Rus, Economic evaluation of the high-speed rail, University Carlos III de Madrid, pp. 2–3, 2012. Campos, G. de Rus and I. Barron, Economic analysis of high speed rail in Europe Fundacion BBVA, 2009. Levinson, Mathieu, D. Gillen and A. Kanafani, The annals of regional science, 31, pp. 212–213, 1997. de Rus and G. Nombela, Journal of transport economy and policy, 411, pp. 3–23 2007. de Rus and Working paper 590, Institute for Transportation Studies, University of Leeds, 2007. A. Nash, Enhancing the cost benefit analysis of high-speed rail Paper given at the symposium on the environmental and other co-benefits of developing a high-speed rail network in Berkeley California, 2010. Hirota, Japan the Shinkansen effects, Transports, 310, pp. 678–679, 1985. Nakamura and T. Ueda, Proceeding of Fifth World Conference on Transport Research, 3, Yokohama, Japan, 1989 pp. 95– G. Cho and J. K. Chung, Korea Research Institute for Human Settlements, Special Report 12, pp. 7–13, 2008. Korea Transport Institute KOTI, Modularization of Korea’s Development Experience Construction of high-speed rail in Korea Ministry of Strategy and Finance, Republic of Korea, 2012. Shima, Japan Railway and Transport Review, pp. 40-46, 2007. Barrow, International Railway Journal 2015. Ollivier, J. Sondhi and N. Zhou, China Transport Topics No. 9, pp. 1–2, 2014. Lou and A. Gui, Morgan Stanley Research, pp. 4-10, 2011. Commission EU, High-Speed Europe A sustainable link between citizens Report by Directorate-General for Mobility and Transport, Luxembourg, 2010. presentation at TEMPO conference 18-19 May Oslo, 2010. Vickerman, The Annals of Regional Science 31, pp. 21–38, 1997. Leheis, High-Speed train planning in France, lessons from Mediterranean TGV-line World Academy of Science, Engineering and Technology 20, 2009. International high-speed railway system summary, Spain, pp. 1–2, 2010. high-speed railway system summary, Germany, pp. 1-4, 2010. Galenson and Associates TGA, High Speed Rail Passenger Services World Experience and Applications, 2011. Patuelli, International research society for public management conference, University of Birmingham, pp. 6-8, 2015. dello Stato Italiane, Piano industriale 2014-2017. Italian Railways, Business plan 2014-2017, 2013. p. Commission, EU transport in figures Statistical pocketbook, 2014. This content is only available via PDF. © 2017 Authors.2017Authors TheSOEs are being led by PT Wijaya Karya Tbk to develop the high-speed rail project. The Indonesian consortium comprises PT Wijaya Karya, a construction company, railway operator PT Kereta Api Indonesia, toll-road builder PT Jasa Marga, and PT Perkebunan Nusantara VIII, a plantation company. Benefits of Jakarta to Bandung high-speed rail
Basic Information Name Jakarta–Bandung High-Speed RailwayLocation Jakarta to Bandung, West Java Province, IndonesiaType of Project TransportationProject Developers PT Kereta Cepat Indonesia China KCIC, a 60–40 joint venture between a consortium of Indonesian state-owned enterprises SOEs through PT Pilar Sinergi BUMN PSBI and a consortium of Chinese SOEs through Beijing Yawan HSR Co. Ltd. PSBI comprises PT Wijaya Karya, PT Perkebunan Nusantara VIII, PT Kereta Api Indonesia, and PT Jasa Yawan HSR comprises China Railway International Co. Ltd a subsidiary of China State Railway Group Co. Ltd, CR, China Railway Group Limited known as CREC, Sinohydro Corporation Limited a subsidiary of Power Construction Corporation of China, CRRC Corporation Limited CRRC, and China Railway Signal and Communication Corporation CRSC. Main Contractors High-Speed Railway Contractor Consortium HSRCC, a consortium between Indonesian company PT Wijaya Karya 30% and several Chinese companies 70%, including China Railway International Co. Ltd, CREC, Sinohydro Corporation Limited, China Railway Design Corporation another subsidiary of CR, CRRC Sifang Co. Ltd a subsidiary of CRRC, and Financiers China Development BankCost billion USD estimate as of 2021, from an initial estimate of billion USDProject Status Under construction Project Outline The idea of a fast train project in Indonesia dates back to 2011, when the Japanese International Cooperation Agency JICA together with the Indonesian Ministry of National Development Planning Bappenas carried out a feasibility study for a possible Jakarta–Surabaya HSR, the first phase of which would connect Jakarta to Bandung. The Jakarta–Surabaya medium–high-speed railway was listed as a priority project in 2013. The original plan did not explicitly mention the Jakarta–Bandung HSR, but it suggested the Jakarta–Cirebon route via Bandung section would be prioritised in part due to its higher economic internal rate of return. However, when President Joko Widodo Jokowi came to power in 2014, he shelved the plan to build the railway and reallocated the budget to development projects outside Java. Much to the surprise of everyone, not least the Japanese, in March 2015, Jokowi asked both Japan and China to bid for the Jakarta–Bandung section of the railway. In September 2015, both countries presented their proposals, which were relatively balanced. The Japanese proposed five stations along a 140-kilometre track that is part of the Jakarta–Cirebon route, while the Chinese side planned eight stations along a 150-kilometre track. Though China had a higher interest rate of 2% compared with Japan’s China offered a longer maturity period for the loan 50 years as opposed to 40 years, a shorter time frame for completion of the project, and waived the state guarantee. After a fierce bidding war between China and Japan over the project, which China won, Indonesian Minister of State-Owned Enterprises Rini Soemarno was given a mandate to determine the fate of the railway, including the establishment of the joint-venture company to lead the project. In September 2015, a state-owned fast train consortium was formed, named PT Indonesia China Fast Train or Kereta Cepat Indonesia China, KCIC. KCIC is a consortium of Indonesian and Chinese SOEs. Indonesia is represented by PT Pilar Sinergi BUMN Indonesia PSBI, a consortium of four SOEs—namely, PT Wijaya Karya 38%, active in construction, PT Jasa Marga 12%, toll road builder, PT Kereta Api Indonesia 25%, railways, and PT Perkebunan Nusantara VIII 25%, plantations. Meanwhile, the Chinese side is represented by a consortium led by Beijing Yawan HSR Co. Ltd, which comprises China Railway International Co. Ltd, CREC, Sinohydro Corporation Limited a subsidiary of Power Construction Corporation of China, China Railway Design Corporation, CRRC Corporation Limited, and China Railway Signal & Communication Corporation. The initial deal included debt financing from the China Development Bank CDB—for 75% of the total billion USD cost—which was granted with a 10-year grace period and a 2% interest rate for the dollar-denominated loan. The remaining 25% of the project’s cost will be funded by equity provided by KCIC. After the establishment of KCIC, the railway route was revised. The train was expected to reduce the 142-kilometre trip between Jakarta and Bandung from three hours to less than 40 minutes, with a maximum speed of 350 km/h. Four main stations are planned along the route Halim East Jakarta, Karawang West Java, Walini West Java, and Tegalluar West Java. Project Developer Project Contractor Soon after the establishment of KCIC, the ground-breaking ceremony for the Jakarta–Bandung HSR was held in Walini, West Java Province, in the presence of President Jokowi, on 21 January 2016. However, the project was already embroiled in controversy, with critics expressing concerns over the risk of default and the irregularities in the concession of the building permit. Then Transport Minister Ignasius Jonan did not attend the ceremony, and instead became one of the staunchest critics of the project. On 26 January, Jonan revealed that he had not issued the railway infrastructure operation permit as his ministry was still waiting for the required documents and negotiating basic terms for the concession agreement with KCIC. Despite the lack of permits and support from key ministries and lawmakers, in late January 2016, Jokowi issued a regulation containing a list of about 200 strategic projects including the HSR, signalling the strong backing of and attention from his office for this project. Many pundits believe that by backing the project, Jokowi was attempting to build his political legitimacy, with the project connecting the two largest metropolitan areas and located in the most populated province in Indonesia, cementing Jokowi’s claim to be the country’s Infrastructure Father’. From this point of view, China’s initial commitment to complete the project before 2019 was critical to Jokowi’s government as it provided the president with political capital for his campaign for re-election that year. After several delays, including a stoppage owing to the COVID-19 pandemic, construction of the railway fell way behind schedule. As of December 2020, the project was said to be 64% complete. In April 2021, Indonesian media quoted senior management at KCIC as saying the project would be operational by the end of 2022. In May 2021, President Jokowi inspected the project during his visit to West Java Province and announced the project was 73% complete, with trial runs expected to commence at the end of 2022. Source Drawn by the author. Project Impacts Land The delay in loan disbursement was one of the main factors that impeded construction of the HSR from 2016 to 2018, due to inadequate preparation in the land acquisition According to local nongovernmental organisation NGO Indonesian Forum for the Environment Walhi, project construction has caused flooded roads, landslides, and damaged houses in part due to shoddy management and poor environmental protection procedures. As the planned route of the railway cuts through important water catchment areas, mountainous regions, and agricultural areas, the project has also impacted water supplies and caused environmental stress to the surrounding impact Due to poor preparation and multiple technical challenges, the project has incurred cost overruns. In 2017, the budget swelled from billion USD to billion USD. Economists and policymakers have questioned the viability of the project, worrying it will drag Indonesia into a debt trap. Employment and labour rights The project was expected to create 39,000 jobs—both casual and permanent—during its three-year construction phase, but no data are available to show whether this promise has been fulfilled. Meanwhile, for its operation, KCIC is set to offer 2,400 local jobs and the recruitment process was under way as of April 2021. The Jakarta–Bandung HSR has led to various concerns regarding the financial sustainability of the KCIC and Indonesian SOEs in general. With Indonesian finance accounting for a major share of total investment in the project 60%, economists and policymakers voiced concerns about whether the country was at high risk of falling into debt distress. This was especially so because the Indonesian SOEs joining the consortium are debt-heavy entities and, before the inception of KCIC, were already struggling to meet their repayment obligations. To develop these major projects, the SOEs are frontloaded with debt and will only get cash flow back years into the future, which is why delays are so costly. Some Members of Parliament called on the government to halt the project amid increased concerns that a bailout would be necessary should KCIC default on its debt. In particular, Prabowo Subianto, a challenger to Jokowi’s presidency during the 2019 general election, built his campaign on the claim that Indonesia’s economic shortfalls were due to Chinese exploitation, and he even staged a protest against the HSR. As part of the campaign, Prabowo’s team promised to renegotiate—if not cancel—the project, claiming that Indonesia must get a better deal’, given that Chinese investment had eroded national interests. During the COVID-19 pandemic, pundits and the media regularly questioned the project’s sustainability. In June 2020, the Jokowi government began discussions with Japan to join the project and suggested integrating the Chinese-built HSR with a separate Japanese-funded railway project linking Jakarta and Surabaya along a different route. Some in the Indonesian Government argued that only by integrating the two projects could they both become economically viable. However, integration would be difficult as the Japanese-built section uses a different railway gauge and speeds. The restructuring of KCIC management and the appointment of a new chief executive in March 2021 have been interpreted as clear signs of the worsening financial outlook for the company. Adding to this, the following month, Indonesian SOEs also suggested that China take up a larger stake in the project to bear the cost overrun. This remains unresolved and, according to the corporate secretary of KCIC, who was quoted by Reuters in April 2021 Until now, details regarding additional unexpected costs are still being discussed and negotiated at the shareholder level. Also, consultations between the Government of Indonesia and China are continuing.’ According to an interview conducted by the author with one human resources manager, KCIC has employed a majority of local staff in the construction of the project, but top-level management is mostly dominated by Chinese expatriates, despite the fact the Indonesian side has a 60% share in the consortium. KCIC also claimed it has provided vocational training for domestic staff and local engineers to become the first HSR technicians’ in Southeast Asia. While generating more than 2,400 job opportunities, the project has faced multiple problems and technical challenges in its construction phase. In April 2016, vendors tasked by KCIC to carry out land investigations—including five Chinese nationals—were detained by the Indonesian Air Force for trespassing at the Halim Perdanakusuma Airport. In October 2019, a construction mishap caused Indonesia’s state-owned Pertamina oil pipeline to erupt in flames. In January 2020, the breach of an embankment allegedly caused by KCIC led to flooding in the West Bandung Regency. In March 2020, flooding caused by improper landfill and waste dumping blocked the Jakarta–Cikampek toll road, which is one of the busiest routes in the greater Jakarta region. These incidents have sparked public suspicion about the quality of the project’s technical assessment, given the environmental impact assessment AMDAL was completed in just seven days before the ground-breaking ceremony, according to NGO Walhi, which has been questioning the AMDAL submitted by KCIC since early 2016. Following the recent construction mishaps and environmental degradation caused by the project, Walhi staged a series of protests demanding the Indonesian Government and KCIC reassess the project, but they have been met with no response. The project continues without any further information being made public about plans to revisit the AMDAL or actions to minimise the risks. The land acquisition process has been no less problematic. Although KCIC secured a concession for the project in April 2016, progress was slow in the first two years. The inadequate preparation of land acquisition procedures and the involvement of ill-informed Chinese companies that overlooked the complexity of landownership in Indonesia have led to many controversies. There was a tendency on the part of the Chinese companies to assume public ownership of all land, as is the case in China. Moreover, the CDB made funding conditional on Indonesia securing all the land needed for the railway, making the delay even more challenging. Acquisition of land for the project finally reached 99% in late 2019, after the Indonesian Government intervened in the process. In-Depth Sources Belt and Road Podcast. 2021. Easy Money is Rarely Easy Jessica Liao on Infrastructure Financing and Export Credit Agencies.’ Belt and Road Podcast, 21 January. Link. Camba, Alvin. 2020. Derailing development China’s railway projects and financing coalitions in Indonesia, Malaysia, and the Philippines. GCI Working Paper 008. Global Development Policy Center, Boston University. Link. Friends of the Earth US. 2017. Investing in a Green Belt and Road? Assessing the Implementation of China’s Green Credit Guidelines Abroad. Washington, DC Friends of the Earth US. Link in English; Link in Chinese. Liao, Jessica C. 2020. Easy Money and Political Opportunism How China and Japan’s High-Speed Rail Competition in Indonesia Drives Financially Risky Projects.’ Panda Paw Dragon Claw, 21 December. Link. Liao, Jessica C. and Saori N. Katada. 2020. Geoeconomics, Easy Money, and Political Opportunism The Perils under China and Japan’s High-Speed Rail Competition.’ Contemporary Politics 271 1–22. Lim, Guanie, Chen Li, and Emirza Adi Syailendra. 2021. Why Is It So Hard to Push Chinese Railway Projects in Southeast Asia? The Role of Domestic Politics in Malaysia and Indonesia.’ World Development 138. Link. Salim, Wilmar and Siwage Dharma Negara. 2016. Why is the high speed rail project so important to Indonesia? ISEAS PerspectiveNo. 16. Singapore ISEAS–Yusof Ishak Institute. Link. Tritto, Angela. 2020. Contentious Embeddedness Chinese State Capital and the Belt and Road Initiative in Indonesia.’ Made in China Journal 51 182–87. Featured Image Credits muhammadpascalfajrin CC, on
JakartaBandung High Speed Railway Tentang Kami WIKA adalah satu-satunya kontraktor asal Indonesia yang dipercaya dalam pembangunan Proyek Kereta Cepat Jakarta-Bandung. Presiden Joko Widodo menunjuk WIKA secara langsung sebagai kontraktor yang mengerjakan KCJB, hal ini membuktikan kualitas WIKA sebagai kontraktor BUMN tidak diragukan lagi. Rome, June 6 Reuters - A Webuild-led consortium has won a tender worth billion euros $ billion to build a section of a new high-speed railway line in Sicily, the Italian construction group said on leads the consortium with a 75% stake, while Italian partner Ghella holds the remaining 25%.Under the contract, the consortium will build 30 kilometres of railway between Palermo and Catania - the two main cities in Sicily, an island that has long suffered from poor transport said the new line would cut travel times between Palermo and Catania from three hours to contract announced on Tuesday was awarded by Rete Ferroviaria Italiana RFI, part of state-controlled railways group Gruppo Ferrovie dello Stato Italiane.$1 = eurosReporting by Federica Urso, editing by Alvise Armellini and Jason NeelyOur Standards The Thomson Reuters Trust Principles. On30 July 2019, IKM has been successfully awarded by HSRCC (HighSpeed Railway Contractor Consortium) for the most remarkable commercial project located in Bandung area : Jakarta-Bandung High-Speed Rail. IKM's contractual scope includes the whole EPC works for HSRCC headquarter base camp, steel structure workshop, landscape etc.
Connect 6ix will operate and maintain the Ontario Line for 30 years. The Ontario Line will be a new rapid transit line with 15 stations. Credit Sophia Hilmar from Pixabay. Infrastructure Ontario and Metrolinx have selected Connect 6ix team to design, construct, finance, operate and maintain the Ontario Line Rolling Stock, Systems, Operations, and Maintenance RSSOM package. This contract is valued at C$9bn $ including C$ $ for capital costs. The remaining C$ $5bn will be used for short-term construction financing and transaction costs, train costs, and 30-year operations and maintenance, lifecycle, and long-term financing. The Connect 6ix team includes the applicant lead, Plenary Americas, Hitachi Rail, Webuild Group Salini Impreglio Canada Holding, and Transdev Canada, as well as design teams such as Hitachi Rail and IBI Group Professional Services Canada. It also includes the construction teams Hitachi Rail, Webuild Group Astaldi Canada Design & Construction and Impreglio Civil Works, and NGE Contracting. The operations, maintenance, and rehabilitation team comprises Hitachi Rail and Transdev Canada, while National Bank Financial and Sumitomo Mitsui Banking are the financial advisers. Connect 6ix will start operating and maintaining the Ontario Line for a 30-year term following the completion of all the civil infrastructure elements and systems from the Ontario Line North and South segments. The new rapid transit line will operate between the Ontario Science Centre and Exhibition/Ontario Place in Toronto. It will have 15 stations, including six interchange stations. It is said to offer 40 connections to other subways, buses, streetcar, light-rail transit, and regional rail services.
MainContractor(s): High-Speed Railway Contractor Consortium (HSRCC), a consortium between Indonesian company PT Wijaya Karya (30%) and several Chinese companies (70%), including China Railway International Co. Ltd, CREC, Sinohydro Corporation Limited, China Railway Design Corporation (another subsidiary of CR), CRRC Sifang Co. Ltd (a
Contracts for rolling stock, systems, operation and maintenance as well as construction of the southern section of the line expected to be signed by the end of the Credit Metrolinx INFRASTRUCTURE Ontario and Metrolinx have selected the preferred consortia to deliver the rolling stock, systems, operation and maintenance RSSOM as well as the south section civils, stations and tunnel contracts for the Ontario Line metro in Toronto. The Ontario Line project is estimated to cost $C $US and is structured as a public-private partnership PPP, and will use a design-build-finance model. Connect 6ix is the preferred consortium for the RSSOM contract, which will provide a 30-year design-build-finance-operate-maintain contract for the entire Ontario Line. The group comprises Applicant lead Plenary Americas, Hitachi Rail, Webuild Group Salini Impreglio Canada Holding, Transdev CanadaDesign team Hitachi Rail, IBI Group Professional Services CanadaConstruction team Hitachi Rail, Webuild Group Astaldi Canada Design & Construction and Salini Impreglio Civil Works, NGE ContractingOperation, maintenance and rehabilitation team Hitachi Rail, Transdev Canada, andFinancial advisors National Bank Financial, Sumitomo Mitsui Banking Corporation. As part of its work, Hitachi Rail will design, supply and maintain the rolling stock for 30 years. In addition, the consortium will design, build, operate and maintain all track, communications and train control infrastructure and systems for the line, as well as design, build, operate and maintain the depot facility, the operation control centre and back-up operation control centre. NGE Group confirmed that it will supply and install the railway systems and build the depot in a joint venture with Hitachi and Webuild. Webuild says has a €450m stake in the joint venture responsible for the civil works and a 10% stake in Connect 6ix. South section contract Ontario Transit Group is the preferred consortium selected for the Ontario Line South contract, which involves a design-build-finance contract for the southern section of the line running from Exhibition/Ontario Place to the Don Yard portal, west of the Don River. The consortium consists of Applicant lead Ferrovial Construction Canada, Vinci Construction Grands ProjetsDesign team Aecom Canada, Cowi North America, GHD, Sener GroupConstruction team Ferrovial Construction Canada, Janin AtlasFinancial advisor Agentis Capital. The consortium will be responsible for excavating the 6km of tunnels as well as an above ground station that will integrate with the existing Go Transit Exhibition station, two underground stations to integrate with the existing Toronto Transit Commission TTC Osgoode and Queen metro stations, and four new stations at King/Bathurst, Queen/Spadna, Moss Park and Cooktown. The group will also oversee the groundworks required to build the tunnels and stations. Infrastructure Ontario and Metrolinx say both consortia ranked first in the evaluation of their respective request for proposals received in June 2022. Negotiations are continuing to finalise the contract ahead of awarding the contracts by the end of the year, the partners say. Procurement for the North civil major works, as well as enabling works for bridge, track and other preparatory activities, are set to follow. The Enabling Works Three package will include a new “iconic” bridge crossing the Don River Parkway and Don River. Construction on the new Exhibition station got underway earlier this year, effectively marking the start of construction on the Ontario Line, which will comprise 15 stations and will run from Exhibition Place in the west through the city centre to Ontario Science Centre in the northeast. There will be of dedicated track in existing rail corridors, of elevated track and underground. The line is expected to carry 388,000 passengers per day, with a peak frequency of a train every 90 seconds. Journey times are expected to take 40 minutes when the line opens in 2027, compared with the current 70 minutes. The Ontario Line is one of four shovel-ready public transport projects in the Greater Toronto Area GTA in which the Canadian and Ontario governments and the City of Toronto have agreed to invest a total of $C For detailed data on North American rail projects, subscribe to IRJ Pro.
HighSpeed Railway Contractor Consortium adalah konsorsium yang dibentuk untuk melaksanakan pembangunan proyek Kereta Cepat Jakarta-Bandung. Konsorsium ini terdiri atas 7 (Tujuh) perusahaan yang memiliki keahlian di bidangnya. Beberapa perusahaan bertugas sebagai kontraktor dari konstruksi sipil, sedangkan lainnya bertugas sebagai

This article has been translated by PwC Indonesia as part of our Indonesia Infrastructure News Service. PwC Indonesia has not checked the accuracy of, and accepts no responsibility for the content. Investor Daily - Pemerintah Suntikkan Rp4,3 Triliun ke Proyek KA Cepat Jakarta-Bandung 13 October 2021 By Thresa Desfika, Triyan Pangastuti, Muawwan Daelami, and Arnoldus Kristianus Jakarta – The government is investing trillion in PT Kereta Api Indonesia KAI to cover the lack of funds for the construction of Jakarta-Bandung High-Speed Railway that increased by around Rp27 trillion or 31% from the original cost. The investment is provided in the form of an additional state capital participation PMN for PT KAI, one of the four SOEs State-owned Enterprises in PT Pilar Sinergi BUMN Indonesia. The construction of the high-speed railway that spans 142 km is predicted to be finished at the end of 2022, which is 12 months later from the original schedule. Other SOEs in PT Pilar SInergi BUMN Indonesia PSBI are PT Wijaya Karya Persero Tbk, PT Jasa Marga Persero Tbk, and PT Perkebunan Nusantara PTPN VIII. To work on the high-speed railway, PSBI is cooperating with a Chinese company by establishing the KCIC consortium. PSBI’s ownership portion in KCIC reaches 60%, while the Chinese company owns the remaining 40%. When the consortium PT Kereta Cepat Indonesia China KCIC was established, KCIC was obligated to provide a capital of around trillion. This is 25% of the estimated cost of Jakarta-Bandung High-Speed Railway worth US$ billion or trillion in total. PT Pilar Sinergi BUMN Indonesia that owns 60% of KCIC shares must provide a capital of around trillion, while the Chinese consortium Beijing Yawan that owns 40% of the shares must provide trillion. With 25% provided from their own capital, the remaining 75% or around trillion US$ billion will be provided by a loan from China Development Bank. PT Kereta Api Indonesia Persero or KAI President Director, Didiek Hartantyo, said that, as a follow-up action from Presidential Regulation Number 93/2021 that appointed KAI as the new leader of PSBI, the PMN for KAI was prepared to provide the base equity capital for Jakarta-Bandung High-Speed Railway. Previously, PSBI’s leader was PT Wijaya Karya Pesrero Tbk as they owned 38% of the shares, while KAI owned 25%, PT Jasa Marga Persero owned 25%, and PT Perkebunan Nusantara PTPN VIII owned 12%. The trillion PMN will be used to cover the lack of capital from the SOE consortium, Rp240 billion from WIKA, Rp440 billion from KAI, Rp540 billion from Jasa Marga, and trillion from PTPN. “So, the trillion PMN will be used to provide the base equity capital,” Didiek said when he was contacted by Investor Daily on Monday 11/10. He explained that, to work on the high-speed railway project, PSBI established a joint venture with a Chinese consortium, Beijing Yawan, called PT Kereta Cepat Indonesia China. The fund required for the high-speed railway spanning 142 km reaches US$ billion. Special Staff for SOE Minister, Arya Sinulingga, explained that, previously, the funding would be provided from the state budget as the four SOEs involved in the project was impacted by the Covid-19 pandemic, which hindered the capability of the state-owned companies in financing the cooperation project between Indonesia and China. “This is what forces the government to provide funding so that the high-speed railway can be excellently constructed,” Arya said to an interviewer on Sunday 10/10. In article 4 paragraph 2 of Presidential Regulation Number 93 of 2021, it is mentioned that other funding can be provided from the state budget to maintain the progress of a national strategic project by considering the fiscal capacity and sustainability. Then, paragraph 3 of article 4 states that financing can be provided from the state budget in the form of state capital participation for the SOE consortium leader and/or guarantee for the SOE consortium leader. “Presidential Regulation Number 93/2021 appoints PT KAI as the consortium leader, while the previous leader was PT Wijaya Karya Tbk. So, this is nothing. The issue is only that [the SOEs are impacted by the pandemic]. Wherever you go, in almost all countries, the government is involved in their high-speed railway project. Almost all countries are like that,” Arya said. He added that the construction progress of Jakarta-Bandung High-Speed Railway project had reached 80%. With funding from the government later, Arya continued that the project completion was expected to be accelerated. Cost overrun On a separate occasion, SOE Deputy Minister, Kartika Wirjoatmodj, revealed that, previously, there were several issues regarding Jakarta-Bandung High-Speed Railway. First, regarding the initial capital. According to him, PT PTPN VIII’s plan to provide additional capital in the form of lands in Walini in West Java was rejected by the consortium. “PTPN VIII was planning to increase the capital in the form of lands in Walini. In its development, the consortium KCIC does not receive contribution in the form of lands, only cash. PTPN VIII does not have the capability to provide cash of that amount,” Kartika Warjoatmodjo, familiarly called Tiko, said. Besides that, he continued that Jasa Marga was also planning to provide capital in the form of a right of way ROW on their toll roads. However, a ROW turns out can only be provided by the State Asset Directorate General of the Finance Ministry. “This misunderstanding on ROW is due to a lack of legal study at the early stage. Furthermore, capital from WIKA and KAI are also still lacking,” he said. To cover the lack of capital, Tiko continued that KAI was proposed to receive a state capital participation of trillion this year. The fund will be included in the 2021 additional PMN. “We expect that the culmination [of the lack of the capital from Jasa Marga and PTPN VIII] and the lack of the additional capital from WIKA and KAI can be provided by the PMN. The PMN through KAI that will be used to smooth out [the construction of] Jakarta-Bandung High-Speed Railway is required as the companies are under pressure from the Covid-19 pandemic,” Tiko stated. Furthermore, Tiko said that the second issue regarding the Jakarta-Bandung High-Speed Railway project was the cost overrun. In Tiko’s presentation during the working meeting with House of Representatives DPR Commission VI, it was shown that the cost overrun of Jakarta-Bandung High-Speed Railway was estimated to reach around US$ billion to US$ billion. “We are currently having a discussion on the cost overrun. I think that it will not be provided in this year’s [PMN], but next year’s,” Tiko revealed previously. Then, he revealed that the third issue was the cash deficit. According to Tiko, discussions with China are still held to handle the negative operational cash flow, which will occur at the start of Jakarta-Bandung High-Speed Railway’s operation. “We are thinking of a scheme with financing from a bank, which is CDB China Development Bank,” Tiko said. Special Staff for SOE Minister, Arya Sinulingga, previously explained that another problem was the change of Jakarta-Bandung High-Speed Railway’s route to Jakarta-Padalarang-Bandung. This is set in Presidential Regulation Number 93 of 2021. Previously, the route was set to be Jakarta-Walini-Bandung. “Price changes can occur and are normal in a project. Moreover, in a project with a long route such as the Jakarta-Bandung High-Speed Railway project that spans 142 km. During construction, the design can change due to geological and geographical conditions that change from the original condition. Do not say that the original plan is wrong. Then, the price of lands can increase in time, which occurs during almost every construction,” he added.

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    • high speed railway contractor consortium