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Off the rails – Indonesia's Belt and Road rail mess


South-east Asia's first bullet train is half-way there, according to the Indonesian government. Others say the much-delayed $7.8 billion project, part of China's Belt and Road Initiative, should never have begun.

Emma Connors
Emma ConnorsSouth-east Asia correspondent
Updated 
Sydney/Jakarta | Earlier this year, the Japanese International Co-operation Agency team working on a new rail link between Jakarta and Surabaya, the country's second-biggest city, was taken aback by a request from the Indonesian government.

Could JICA speak to the Chinese-backed venture behind another new line, the much-anticipated, high-speed link from the Indonesian capital to Bandung in West Java? Perhaps the two projects could be combined?

Going nowhere fast ... Indonesian President Joko Widodo inspects construction on the Jakarta to Bandung high-speed rail link. 

As strange as it sounds, the request was just another twist in a 12-year-long struggle to build south-east Asia's first bullet train.

In theory, trains capable of a 350km/h maximum could reduce the 142-kilometre trip between Jakarta and Bandung from three hours to less than 40 minutes.

In practice, the delay-plagued project, worth $U5.5 billion ($7.8 billion), is running up to four years late and is already unpopular among many of the people it is supposed to benefit, mainly because of massive environmental damage and the fact fares will be beyond their reach anyway.

The service will struggle to attract passengers, says Andry Satrio Nugroho, economist at the Jakarta-based Institute for Development and Finance (INDEF).

"This is a trophy project, begun to mark the entry of the Belt and Road Initiative into Indonesia. From a business perspective, it doesn't make much sense," he says.

Cheaper offer

First floated in 2008, the project looked to be going to JICA in 2015 before Beijing stepped in.

President Xi Jinping was on a mission to expand China's soft power through infrastructure spending, while in Jakarta President Joko "Jokowi" Widodo was keen to tap Chinese know-how and funding to help expand the Indonesian economy.

In any case, China's financing terms were more attractive. The government-controlled China Development Bank, which has to date stumped up more than $US190 billion ($268.6 billion) for 600 BRI projects, was prepared to finance the bulk of the project through a private business structure that required no Indonesian state funds.

The Japanese, in contrast, wanted Jakarta to put more skin in the game with a government guarantee.

In September 2015, President Widodo announced the Chinese proposal had won the day. A joint venture, Kereta Cepat Indonesia China, was established to run the project. It was owned by a consortium of Indonesian state-owned enterprises and a group of Chinese railroad companies under the umbrella of Beijing Yawan HSR.

Construction began in 2016 with the promise that by May 2019 Indonesia would proudly begin operating south-east Asia's first bullet train. Sixteen months after the originally scheduled completion date, Indonesia is still waiting. Kartika Wirjoatmodjo, Deputy Minister for State-owned Enterprises, last week said construction of the project was 56 per cent complete.

A grand white elephant? Economists have questioned the merits of the Jakarta-Bandung high-speed railway, which has been under construction for the past four years.  Bloomberg

"We hope this [the Jakarta-Bandung fast train] can be completed by the end of 2022. Or at the latest by the beginning of 2023," he says.

There is no surprise that JICA, five years after it was dumped in favour of the Chinese bid, has pushed back on the Indonesian government's request to get involved again. The official line from Jakarta is that discussions to integrate the two rail projects have been delayed by the pandemic, but sources close to the Presidential Palace say the plan is unlikely to go ahead.

Environmental damage

On paper at least, merging the two makes sense, given both routes proceed in roughly the same south-east direction from Jakarta. But that's where the similarity ends – the two don't even plan on using the same track gauges.

With a proposed length of 720 kilometres, the Jakarta-Surabaya line appears even more ambitious than the Jakarta-Bandung line. But there are some important differences. The longer project will be a "medium-speed" train with a more modest promise of cutting in half the present trip time of between eight and nine hours.

Much of the new line encompasses existing infrastructure, which means fewer land acquisition issues of the type that have dogged the Jakarta-Bandung line – and fewer upset locals.

By contrast, construction of the Jakarta-Bandung line has proved a nightmare for those living along the route.

Meiki Paendong, executive director of WALHI West Java – Friends of The Earth Indonesia, says project work has forced people out of their homes, flooded roads, damaged houses, blown the budget and violated at least six Indonesian laws, in an as-yet-unpublished opinion piece seen by The Australian Financial Review.

"Despite an original May 2019 completion deadline, the Jakarta Bandung High Speed Rail is still going nowhere," Meiki says.

At one point, the China Development Bank withheld funds because of problems with land acquisition, Meiki says. "Even the Indonesian Air Force has resisted giving up land for this ill-conceived project."

All work ceased for weeks earlier this year when border restrictions affected the movement of Chinese labour and expertise. However, environmental groups say there were plenty of problems before the pandemic came along.

Construction waste has blocked drainage channels and led to flooding. In March, the water was so high it cut the toll road linking the two cities. This was not an isolated incident: more than 100 houses have been inundated on multiple occasions.

Meanwhile, the location of the stations at either end have many wondering who will be tempted to use the service once it is complete. INDEF points out the stations are on the outskirts of both the sprawling capital, Jakarta, and Bandung. For this reason, many of those who travel between the two centres will stick with existing train services or a toll road covering the route, INDEF believes.

With mountainous country requiring tunnels and bridges, construction was always going to be difficult. At this point, though, there is no turning back.


Emma Connors is the South-east Asia correspondent. She was editor of the Perspective and Review sections. Connect with Emma on Twitter. Email Emma at emma.connors@afr.com

https://www.afr.com/world/asia/off-the-rails-indonesia-s-belt-and-road-rail-mess-20200917-p55wms

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