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Transportation

Indonesia woos Japan as China-led high-speed-rail project stalls

Tokyo lost to Beijing in bidding, but construction delay creates new opening

 A high-speed train linking Beijing and Hong Kong. China won the Jakarta-Bandung high-speed-rail project in 2015, but work has been plagued by delays and cost overruns.   © Reuters

JAKARTA -- The Indonesian government has begun discussions on possible Japanese participation in a planned high-speed railway between Jakarta and Bandung, hoping to spur progress on the delayed Chinese-led project as costs mount.

The new proposal would combine that rail link -- which Japan lost out on in 2015 -- with a Japanese-Indonesian project upgrading an existing 750 km connection between Jakarta and Surabaya.

Discussions have begun on extending the high-speed Jakarta-Bandung railway to Surabaya and whether it would be possible to include Japan in the consortium, Foreign Minister Retno Marsudi told an online news conference Thursday.

Japan is an important partner in Indonesia's infrastructure development, and cooperation will help further connect Indonesian cities and promote faster economic growth, she said.

Many in the Indonesian government have argued that a single railway running through Bandung to Surabaya would be more efficient than separate routes going east and southeast from the capital. Cost overruns on the Bandung project have given a boost to this view.

The Ministry of State-Owned Enterprises is expected to draw up a new plan and officially propose it to Japan once it is complete.

China won the Jakarta-Bandung project with a plan requiring no financial contribution from the Indonesian government. The proposed 140 km railway would slash travel time between the two cities to 45 minutes from three and a half hours. The groundbreaking ceremony was held in January 2016, with the launch slated for 2019.

Beijing regards it as an important part of its Belt and Road Initiative. In June 2019, Chinese President Xi Jinping said in a meeting with his Indonesian counterpart Joko Widodo, "We must steadily build and improve the quality of cooperation under the One Belt, One Road Initiative."

But delays in securing the necessary land -- a condition of financing from the China Development Bank, which was to provide 75% of the funding -- bogged down the project, pushing back the opening to 2021. More recently, construction was temporarily halted as a precaution to avoid spreading the coronavirus.

Airlangga Hartarto, coordinating minister for economic affairs, has indicated that the project will be delayed by another year. A review of the country's infrastructure development projects raised the projected cost of the Jakarta-Bandung link to $6 billion from the previous estimate of $5.5 billion.

This led to the idea of extending the railway to Surabaya and bringing Japan into the project. The proposal came to light May 29, after Widodo and members of his cabinet met to reevaluate national strategic projects.

"To be more economical, President Jokowi has instructed that the project not stop at Bandung but be extended to Surabaya" and also asked to add Japan to the consortium, Airlangga said after the meeting, as reported by The Jakarta Post.

The change in plans has baffled the Japanese side, which has already launched a feasibility study for the Jakarta-Surabaya link and would have trouble shifting gears. That project uses existing track and has different specifications from China's high-speed rail line.

"We can't imagine" what the new Indonesian proposal will look like, a source from Japan's Ministry of Foreign Affairs said.

The proposal for Japan to join a project for which it and China had competed comes amid a recent push for Sino-Japanese cooperation on infrastructure in third countries.

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