TEMPO.CO, Jakarta-Commissioner of PT Pilar Sinergi BUMN Indonesia Sahala Lumban Gaol, said that almost all funding for the fast train development project will come from China. The capital will come from loans and joint-venture companies involved in a consortium.

"The funding scheme is 75 percent of the China Development Bank (CDB), 25 percent of the consortium equity,” he told Tempo on Friday, October 16.

He explained that the government does not provide financing, except facilitate land acquisition. The project had been estimated at US$5.5 billion (approximately Rp 74.7 billion, at Rp 13,591.5 per US dollar), which is entirely originate from loans and consortium equity and none from the government, he said.

Sahala also said, that the Jakarta-Bandung train is a commercial business model. It means that the business does not burden state budget because there is no direct government involvement. According to the plan, the project is scheduled for completion by end of 2018, and will start operating in the first quarter of 2019.

As much as 75 percent loans from the CBD has been discussed since the beginning of the project. CBD was chosen because they demand no collateral from the government.

“There isn’t any corporate guarantee either,” he said. As for the remaining 25 percent equity capital, 60 percent comes from PT Pilar Sinergi BUMN Indonesia and 40 percent from China.

ABDUL AZIS