JAKARTA: Indonesia and China agreed to a budget overrun of 18 trillion rupiah (US$1.2 billion) for their Jakarta-Bandung fast trains, set to be the first high-speed rail link in Southeast Asia when it is completed in a few months’ time.
It was originally expected to cost about 66.76 trillion rupiah when the project began in 2015.
But PT KCIC, the consortium of Indonesian and Chinese state companies building the railway, said the cost has since ballooned to 113 trillion rupiah.
Speaking in Parliament on Monday (Feb 13), deputy minister of state-owned enterprises Kartika Wirjoatmodjo said that a budget overrun of US$1.2 billion was agreed upon during a meeting in Beijing, China, some time ago. He did not say when the meeting took place.
“We agreed on the cost overrun figure of US$1.2 billion. There are several items that we are still reviewing regarding taxes, frequency clearing fees, and so on,” said Mr Wirjoatmodjo.
“Currently, we are in the middle of negotiating the terms of the loan from China Development Bank (CDB), which is expected to be resolved in one or two weeks. So the rapid train project can finish according to the timeline, which is June or July 2023.”