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Economy

Widodo wants bullet train to inspire beyond Java

One reason China won the deal to supply the bullet train system was the missing requirement for a guarantee from the Indonesian government.

WEST JAVA -- At its launch on Thursday, President Joko Widodo said he wants Indonesia's first high-speed rail link connecting Jakarta and Bandung to inspire other parts of the archipelago to develop mass transit systems.

     Widodo said development of Indonesia's public transportation networks had been neglected, forcing people to rely heavily on private vehicles. The first mass rapid transit network in Jakarta, for example, had been planned for 26 years but did not get under way until two years ago.

     The capital, like many Indonesian cities, is increasingly gridlocked.

     "If this project is successful, I'm sure it will trigger other provinces, districts and cities to make similar requests," the president said during the groundbreaking ceremony at Walini on the outskirts of Bandung, Indonesia's third largest city and the capital of West Java province.

President Joko Widodo presided at the groundbreaking ceremony for Indonesia’s first high-speed railway on Thursday.

     The high-speed rail link is a joint project between Indonesia and China due for completion by 2018 with operations starting in early 2019. The 142km line has four stations: Halim in East Jakarta, and Karawang, Walini and Tegalluar in West Java.

     Widodo said the high-speed network would boost mobility between the capital and Indonesia's most densely populated province, and would spur national efficiency.

     "This is an era of competition," said Widodo. "Countries that have good competitiveness, that are efficient and do their development fast will be the winners."

     Widodo said he had already approved the West Java governor's proposal for a light rail transit (LRT) network connecting the bullet train stations in Walini and Tegalluar to Bandung.

     According to press reports, Widodo has appointed the same China-Indonesia consortium on the high-speed link to handle Bandung's LRT network, although he has yet to sign a decree to seal the appointment.

     Indonesia's first LRT networks were only launched in Jakarta and Palembang, South Sumatra, last year. Surabaya, East Java's capital and Indonesia's second city, has requested central government funding for its LRT.

     Widodo on Thursday also reminded that more developed cities in Java should engage companies -- especially major state-owned ones -- to finance public transit development.

     The president said state funds would be spent exclusively on infrastructure outside Java such as the trans-Sumatra highway and the Makassar-Manado railway project in Sulawesi, and Papua's first rail network, which the government hopes to launch this year.

     Widodo said he did not not want more Java-centric development. "We want it to be Indonesia-centric," he said.  

The Jakarta-Bandung high-speed link is expected to spawn other developments, including around Walini west of Bandung, which is one of four stops along the line.

     The Jakarta-Bandung link has been contracted to Kereta Cepat Indonesia Cina (KCIC), a consortium of Indonesian and Chinese state companies. China won the bid over Japan last year with a proposal that won favor for not requiring a guarantee from the Indonesian government. Three-quarters of the $5.5 billion cost will come out of soft loans from the China Development Bank, and the rest from the consortium's members.

     KCIC president Hanggoro Budi Wiryawan said the project would spur transit-oriented development along the route served by bullet trains that reach 250kph. Walini and Tegalluar will be developed as new townships, and the system will serve over 25,000 passengers daily with 50 departures.

     Shares of construction company Wijaya Karya, the leading Indonesian member of KCIC, closed 0.18% down at 2,800 rupiah on Thursday, while the benchmark Jakarta Composite Index declined by 0.31% in the same period.

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