Deputy Speaker Of The House Of Representatives, Rachmat Gobel: The Jakarta-Bandung High-speed Train Made By China Is More Expensive Than The Proposal Submitted By Japan

JAKARTA - Deputy Speaker of the Indonesian House of Representatives, Rachmat Gobel, criticized the government's decision to allow the use of the state budget for the Jakarta-Bandung high-speed rail project. According to Rachmat Gobel, the project being worked on by China is more expensive than the Japanese proposal.

"Let's leave the issue of the high-speed train to the investors. This is in accordance with the initial idea with the principle of business to business," he said in an official statement, quoted on Sunday, October 31.

Rachmat Gobel said China won the competition with Japan in the construction of the 142.3 km high-speed train several years ago. At that time, he continued, Japan submitted a proposal with a value of 6.2 billion US dollars, while China submitted 5.5 billion US dollars.

The former Trade Minister further explained that China won because it did not ask for government guarantees, there was no involvement of the state budget, and the business to business scheme. However, the cost of constructing the high-speed train swelled to 6.07 billion US dollars.

In fact, Rachmat Gobel revealed that the cost has now increased to 7.97 billion US dollars. In fact, he assessed that Japan, which has been tested with the quality of the Shinkazen high-speed train and has conducted a feasibility study on the Jakarta-Bandung line since 2012, has also been defeated by China's proposal.

"We don't know whether there will be another increase or not. What is certain is that so far it has swollen twice. This condition is the opposite of the original three promises and is already more expensive than the Japanese proposal. In terms of quality, Japan is definitely much better," said Rachmat Gobel.

According to him, Indonesia is faced with budget constraints due to the COVID-19 pandemic. He said that many budgets that were not prioritized were cut due to refocusing because the government was focused on dealing with COVID-19 and restoring the economy that hit the poor.

The government, said Rachmat Gobel, should focus the APBN on the construction of the State Capital (IKN) in East Kalimantan rather than the Jakarta-Bandung high-speed rail project.

"We must not back down to build IKN. We just focus on the things that are our priorities," he added.

Rachmat Gobel also urged the government to be consistent with the business-to-business scheme. Thus, the cost overrun was handed over to the Indonesian-China Fast Train consortium (KCIC).

This consortium involves nine companies. From Indonesia, there are four SOEs, namely Wijaya Karya, Jasamarga, Perkebunan Nusantara VIII, and KAI. While from China are China Railway International Company Limited, China Railway Group Limited, Sinohydro Corporation Limited, CRRC Corporation Limited, and China Railway Signal, and Communication Corp.

From Indonesia to form a business entity PT Pilar Sinergi BUMN and from China to form China Railway. Then the two formed KCIC. If there is a cost overrun, it is handed over to these companies.

"If there are companies that are unable to deposit additional fees, their shares will be deluded automatically. This is a normal business process. This is called business to business. Don't force yourself to ask for funds from the state budget," he concluded.