Indonesia goes slow on rail contract
Print Edition
INDONESIA has dropped much-vaunted plans for a high-speed railway in favor of a slower and cheaper option, dealing a blow to China and Japan who had been fiercely competing to win the contract.
President Joko Widodo was expected to award the multi-billion contract this week but instead the government announced yesterday that the project had been shelved, citing cost and feasibility concerns.
Chief Economics Minister Darmin Nasution summoned the Japanese ambassador yesterday to tell him that Indonesia would pursue a medium-speed rail option and throw open the bidding process to other competitors.
“I conveyed that Indonesia thanked them, but we wouldn’t be continuing with the high-speed train project,” he told reporters, adding that he expected to inform the Chinese ambassador later in the day.
It is not yet clear whether China or Japan will throw their hat in the ring for the revised rail proposal, with the finer details of the project yet to be announced.
The two Asian powerhouses had been locked in a contest for months to build a high-speed railway connecting the sprawling capital Jakarta with the mountain-fringed city of Bandung about 160 kilometers away.
It was seen as a landmark infrastructure project for Widodo, who pledged when he took office last October that he would overhaul Indonesia’s aging roads, rail and ports.
However, he has struggled to get his agenda moving.
Tokyo, with its rail expertise and infrastructure record, seemed destined to build the high-speed rail line until Jakarta announced in April that China had entered the race.
Beijing and Tokyo had both intensified their efforts to win the contract in recent months, dispatching lobbyists to Jakarta and sweetening deals to woo the administration.
But in the end it came to nothing, with the Japanese ambassador unable to hide his disappointment yesterday.
“I expressed my regrets,” Tanizaki Yasuaki told reporters after meeting Nasution. “However ... we pay due respect to this decision. This was not an easy decision.”
An independent review of the rail project commissioned by Widodo found a high-speed line was not appropriate for the short distance to Bandung, and a medium-speed line would be a fraction slower but 30 percent cheaper, presidential chief of staff Teten Masduki told reporters.
Where the previous arrangements with China and Japan required Indonesia either front up cash or enter joint ventures with state companies, the new proposal would draw on private finance to free up the national budget, he added.
Nasution said China and Japan would be invited to submit bids for the revised project once the details were finalized, but added that countries with expertise in medium-speed rail, such as Spain and France, would also be approached.
Top Japanese government spokesman Yoshihide Suga confirmed that the new line would not be financed or guaranteed by the state, quoting the Indonesian government, and said that Japan would need to consider its options.
The Indonesian side “explained that it will be conducted purely as a private project,” Suga said.
“Now, with this explanation, Japan will study how to proceed,” he added.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
