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Dhaka Tribune

Indonesia again delays launch of China-funded high-speed railway

  • Jakarta-Bandung is to become the first high-speed train in Southeast Asia 
  • The project was postponed until September for passenger safety; the full launch is set for October 
  • Concerns arise as Indonesia faces possible debt entanglement with China, giving a chance to expand more influence 
Update : 12 Aug 2023, 11:54 PM

The launch of Indonesia’s first high-speed railway has been delayed yet again, the consortium building the China-funded line, which is over budget and already four years behind schedule, announced Tuesday.

The limited trial launch of the Jakarta-Bandung high-speed train service was set for August 18, but has been delayed until early September, because more time was needed to ensure passengers’ safety, PT Kereta Cepat Indonesia-China (KCIC) consortium said. 

The railway is China’s flagship Belt and Road Initiative project in Indonesia. The BRI is Beijing’s $1 trillion-plus program to finance and build infrastructure across the world. 

“Yes, we have delayed the scheduled [trial] run to early September for more thorough preparations,” Eva Chairunisa, KCIC’s corporate secretary, told BenarNews.

However, there will be no delay in the full operational launch scheduled for October 1, Eva said.

The operation of the Jakarta-Bandung fast train route requires very meticulous preparation because it is the first high-speed train in Indonesia and Southeast Asia, KCIC said in a statement Tuesday.

“Every aspect will be well-prepared, with a primary focus on safety and comfort for the high-speed train passengers,” the KCIC statement said.

“The trial of facilities and infrastructure has been carried out successfully. Currently, KCIC is also ensuring that all supporting operational elements will function properly when the train is operational.”

Beijing has touted the high-speed rail project as a symbol of the close ties between Indonesia and China, but the project has faced several setbacks since it began in 2016.

The rail line was expected to begin service in 2019. It went $1.2 billion over budget and now costs $7.2 billion, up from an initially estimated $6 billion.

In October 2021, President Joko “Jokowi” Widodo decided to allow the government to share the cost of the project, contradicting an earlier pledge and decree in 2015 that prohibited the use of state funds for its construction.

China is now also playing hardball over the funding of the cost overrun. Beijing has insisted on keeping the interest rate for the project loan, including the cost overrun, at 3.4%, despite Indonesia’s request to lower it to 2%.

Some analysts have warned that Indonesia could potentially be heading into a debt trap, with the cost overrun and the potentially high-interest rate, which a minister said is still being negotiated. 

A 2021 AidData study noted that Indonesia owes $17.28 billion in “hidden debt” to China, more than four times its $3.90 billion in reported sovereign debt.

China has a lot riding on the rail line.

The Jakarta-Bandung project is a showcase of China’s ambitions to export its high-speed rail technology and expand its influence in Southeast Asia. China has been competing with Japan, which has a long history of building bullet trains, for rail projects in Southeast Asia.

Last month, China’s President Xi Jinping told Jokowi, who was on a visit to the Asian superpower, that both countries needed to “ensure the high standard and high quality of the project.”

The rail line is expected to reduce the travel time between Jakarta and Bandung to 34 to 45 minutes, from 2.5 hours by regular train.

The train service is expected to run at a speed of 350kph along the 142-km route.

 

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