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Ticket to Development

As a flagship project under the Belt and Road Initiative framework, the new Jakarta-Bandung high-speed rail line goes far beyond transportation and commercial benefits

By Xu Ming , Cao Ran Updated Dec.1

Trains for the Jakarta-Bandung high-speed railway are shipped to Indonesia, Qingdao, Shandong Province, August 21, 2022 (Photo by VCG)

A train travels during a trial run on the Jakarta-Bandung high-speed railway, Indonesia, late June, 2023

Workers construct Tunnel 2, the most technically challenging tunnel on the Jakarta-Bandung high-speed railway, Indonesia (Photos: Courtesy of Sinohydro Engineering Bureau 7 Co., LTD and Sinohydro Engineering Bureau 8 Co., LTD)

During a ceremony on October 2, Indonesian President Joko Widodo inaugurated the country’s first highspeed railway, the Jakarta-Bandung high-speed rail line, the fastest in Southeast Asia. 

Capable of reaching speeds of up to 350 kilometers per hour, Widodo named the first high-speed railway in Southeast Asia “Whoosh,” an acronym for “Waktu Hemat, Operasi Optimal, Sistem Handal,” which means “timesaving, optimal operation, reliable system” in Indonesian.  
The 140-kilometer rail line reduces travel time between Jakarta, Indonesia’s capital, and Bandung in West Java from 3.5 hours to 46 minutes, and will help ease congestion in western Java, the most populated island in Indonesia.  

A milestone for both Indonesia and China’s Belt & Road Initiative (BRI), the railway was constructed by PT Kereta Cepat Indonesia China (PT KCIC), a joint venture between a consortium of four Indonesian state-owned companies and China Railway International Co. Ltd. This is the first time China Railway Group Limited (CREC) has built a high-speed railway overseas from the ground up. Since the project started in 2016, its technical team faced enormous challenges due to the region’s unique geological and hydrological conditions, topography, climate and society, which differ significantly from those in China.  

One hazard is that frequent and prolonged volcanic eruptions have historically created complex geological landscapes. Describing the project’s tunnel construction as a “gamble,” technical staff and builders risked their lives working under these challenging geological conditions.  

Furthermore, the project, initially slated for completion in 2019, faced delays and escalating costs due to land acquisition difficulties. Leaders of several construction teams told NewsChina that the pandemic significantly increased logistics costs. The price of shipping containers soared from US$273 to US$2,000 or even US$10,000, while delivery times doubled or even tripled during this period.  

“The Jakarta-Bandung high-speed train marks the modernization of our mass transportation, which is efficient and environmentally friendly,” Widodo said at the ceremony.  

Dong Zhaoyang, manager of the joint engineering department at China Railway International Co., Ltd, said that the project not only meets Indonesia’s transport needs but also provides technological support for future infrastructure development in the country, including training local technicians and upgrading local standards for construction materials.  

Need for High Speed 
Discussions on building a high-speed railway in Indonesia began in 2008. However, it was not until Indonesian President Joko Widodo attended the APEC Leaders’ meeting in Beijing in 2014 and experienced the high-speed railway between Beijing and Tianjin, that he decided to push for its construction. In March 2015, the two countries signed an agreement to proceed.  

“In 2014, President Widodo unveiled his vision of building Indonesia into a ‘global maritime axis,’ said Zhang Chao, a financial risk executive at PT KCIC. “Weak infrastructure and transportation caused by Indonesia’s scattered geography have hindered its economic development. China is good at what Indonesia needs to improve,” Zhang said.  

It took some time for ordinary Indonesians to get on board with high-speed rail to understand what it could do for their country. Yoga, an Indonesian involved in land acquisition negotiations for the project, told NewsChina that when he discussed high-speed rail with friends and relatives, they compared it to the subway in Singapore.  

During construction, Indonesian media expressed doubts over its necessity. Critics said that there were several forms of transportation already between Jakarta and Bandung, including expressways and an existing railway. They highlighted that 26 million Indonesians, out of a total population of around 278 million, still live in poverty.  

Java, Indonesia’s fifth-largest island and the location of the high-speed railway, has a population of around 151 million, accounting for more than half of the country’s total. One of the most developed regions, it is home to the country’s largest cities – Jakarta, Surabaya and Bandung – and other important industrial and tourist cities.  

According to interviewed residents in Jakarta, there is great demand for commuting options as many people live in Bandung and work in Jakarta. However, the available means of transportation are considered “over-saturated and unable to meet demand.”  

Commutes between the two cities normally take two hours each way on the expressway, which was built in 2005. However, during rush hour and weekends, travel time can reach over five hours, interviewees said.  

By ordinary train, which operates at 50 kilometers an hour, the trip takes more than three hours, even though the terminal stations are closer to the downtown areas of both cities compared to the high-speed railway stations, which are in the suburbs. A business-class seat on a regular ordinary trains cost around US$34.  

While ticket prices for the high-speed service were not finalized as of press time, PT KCIC estimated a one-way ticket will cost between 250,000- 350,000 rupiah (US$16-23), according to an Associated Press report on October 2. Young people and business travelers will be more inclined to travel on the high-speed railway, according to a survey by University Gadjah Mada in Yogyakarta, Indonesia.  

A British businessman who has lived in Indonesia for 20 years told NewsChina there is no need to worry about a shortage of passengers between the two cities. In Jakarta, there are enough people who are both willing to use the new service and are able to afford the highspeed train, he said.  

However, due to challenges in land acquisition and construction, the high-speed rail stations are far from downtown areas, and transportation connections have not improved, locals said. In Bandung, passengers need to take a feeder train for 20 minutes to reach the center.  

Additionally, because Indonesia plans to move the capital from Jakarta to Nusantara on the island of Borneo in 2024, the projected daily number of riders on the high-speed line is expected to halve from 61,157 to 31,215, Dwiyana Slamet Riyad, director of PT KCIC, told a parliamentary hearing in February 2022, Reuters reported. This is because a large number of government employees are expected to relocate to the new capital. Riyad predicted the project would break even in 40 years, twice as long as previously estimated.  

But Yoga does not see this as a major problem. He believes that those who utilize the high-speed railway will diversify. In the future, the government can focus on attracting international visitors to depart from Jakarta’s Soekarno-Hatta International Airport by subway and light rail to the Jakarta high-speed rail terminus of Halim Station, where they can board the train to reach Bandung and eventually other tourist cities along the line.  

“The significant investment will be worthwhile, as long as the government can make the most of the railway to stimulate tourism and economic development,” Yoga said.  

Beyond Budgets 
“If you ask me whether the highspeed railway can make money next year, the answer is a clear no,” Zhang Chao said.  

Total investment for the high-speed railway reached around US$6 billion. Although there were no cost overruns, Zhang said that land acquisition, Covid-induced delays and inflation that caused rising raw material prices had increased the overall cost. He said the 142-kilometer railway is not “cheap” compared to similar lines in China that cost 100-125 million yuan (US$13.7-17.1m) per kilometer.  

Zhang observed that as Indonesia’s largest foreign investment project, the railway will play a significant role in stimulating the railway industrial chain and other associated industries. “Convenient transportation will contribute to regional economic prosperity, and the resulting economic development will help increase passenger flow,” Zhang said, adding that some tend to focus solely on the project’s cost without considering its contributions to Indonesian society. 

Experts anticipate the project will have a positive impact on industries, including the manufacturing of highspeed trains, operation services and infrastructure construction in cities along the line, which will create jobs and attract investment to the region and country as a whole.  

“The railway will not only promote advances in electrified rail technology in the country, but also improve employment and drive manufacturing and infrastructure development in affected areas,” Indonesian Ambassador to China Djauhari Oratmangun said during an open house event held online by CREC in January 2021.  

According to CREC, the building and operation of the railway have created 51,000 jobs, and 45,000 Indonesians have received technical training in skills such as welding, electrics and machinery.  

Lu Kang, Chinese ambassador to Indonesia, told NewsChina that the rail line will generate 30,000 jobs. “More importantly, after the line is put into use, more economic growth points will emerge, resulting in a significant economic scale effect,” Lu said.  

The project is attracting more investment from Chinese companies, which is contributing to local employment and consumption.  

In 2022, trade volume between China and Indonesia reached US$149.4 billion, a 20.16 percent increase from the previous year, making China the country’s biggest trade partner for the 10th consecutive year. Chinese investment in Indonesia spans sectors including power generation, mining, automotive, internet and finance.  

An article published by The Diplomat in June argues that public works projects do not necessarily need to turn a profit to be considered successful, and public transit systems usually run at a loss. The article emphasizes that benefits like Indonesia’s ability to absorb the utilized technology and skills for its own infrastructure will determine the project’s worth.  

Analysts note that Indonesia’s economic growth rate, which has remained around 5 percent, is similar to the economic development cycle China experienced 20 years ago, characterized by a boom in infrastructure construction that significantly boosted economic growth.  

According to Lu Kang, many Indonesians recognize China’s transformation from a developing nation to a major economy through its own path of modernization, and that China is willing to share its experiences with other developing countries through cooperation, including initiatives such as the Belt and Road Initiative (BRI). This cooperation enhances ordinary Indonesians’ understanding of China, Lu said.  

The Jakarta-Bandung high-speed rail line follows the completion of a semi-high-speed railway in Laos, which connects capital Vientiane and Kunming, capital of Southwest China’s Yunnan Province, running at speeds of up to 160 kilometers per hour. Over the past decade, CREC has built several rail lines in BRI countries, including the Mombasa-Nairobi Railway in Kenya. 
Following the completion of the Jakarta-Bandung high-speed rail, Malaysia announced in July that it is considering proposals from companies to revive the high-speed railway plan connecting Kuala Lumpur and Singapore, which was canceled more than two years ago.  

Indonesia has expressed intention to extend the high-speed line to Surabaya in eastern Java, the country’s second-largest city.  

Lu Kang told NewsChina that Indonesia’s size and economic influence among ASEAN members make it an important player. “The achievements in cooperation between China and Indonesia will provide some experience for other countries,” Lu said.  

Lu said he witnessed the determination and confidence of both governments and the consistent collaboration between the construction teams from China and Indonesia to overcome many challenges to push the rail project forward.  

“If there’s experience to be drawn for cooperation between China and Indonesia, China and ASEAN members or from a broader scope, it is adhering to the basic principles of the BRI – extensive consultation, joint contribution and shared benefits,” Lu said.  

“As clarified from the start, the goal of the BRI is to complement the development strategies of the countries involved, rather than reinvent the wheel. Because of this, China’s cooperation with other countries is based on their specific needs and local conditions,” Lu said. “In this sense, the Jakarta-Bandung high-speed rail line exemplifies cooperation under the BRI framework.” 

Chinese Premier Li Qiang inspects the Jakarta-Bandung high-speed railway with Indonesia’s Coordinating Minister of Maritime Affairs and Investment Luhut Binsar Pandjaitan and Indonesian Transportation Minister Budi Karya Sumadi, September 6, 2023

Staff of the Jakarta-Bandung high-speed railway receives training at the Indonesian Railway Polytechnic, Madiun, East Java, Indonesia, June 7, 2023 (Photos by Xinhua)