Whoosh High-Speed Rail Debt Balloons: How Much is it Worth?

Transportation & Logistics

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Adi Ahdiat 24/04/2024 12:21 WIB

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According to a report by the DPR's Commission VI, the cost of constructing the Whoosh High-Speed Rail has ballooned from US$6.07 billion to US$7.28 billion. Its debt financing has also increased from

Whoosh High-Speed Rail Financing/Debt Request (December 2023)

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Whoosh High-Speed Rail Debt Balloons: How Much is it Worth?

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Whoosh High-Speed Rail Financing/Debt Request (December 2023)

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The Jakarta-Bandung High-Speed Rail, also known as the Whoosh train, was built by PT Kereta Cepat Indonesia China (KCIC).

However, only 25% of the Whoosh's construction funding came from KCIC's equity or capital, while the remaining 75% was sourced from a loan from the China Development Bank (CDB).

According to a report from the DPR Commission VI, the initial construction cost of the Whoosh High-Speed Rail was set at US$6.07 billion (approximately Rp97 trillion, assuming an exchange rate of Rp16,000 per US$).

The initial construction cost was covered by US$1.52 billion in KCIC equity financing and a US$4.55 billion loan from the CDB. This CDB loan has a 40-year tenor with a US dollar interest rate of 2% per year.

However, due to land acquisition challenges and the Covid-19 pandemic, the Whoosh's construction cost swelled by approximately US$1.2 billion from the initial estimate, bringing the total to US$7.28 billion (approximately Rp116 trillion, assuming an exchange rate of Rp16,000 per US$).

This cost overrun was covered by an increase in KCIC's capital contribution to US$1.82 billion, and an increase in the CDB loan to US$5.45 billion.

In more detail, KCIC's capital was contributed by two parties: PT Pilar Sinergi BUMN Indonesia (PSBI) and Beijing Yawan HSR Co. Ltd.

PSBI is a consortium of state-owned enterprises involved in KCIC, namely PT Kereta Api Indonesia (KAI), PT Wijaya Karya, PT Jasa Marga, and PT Perkebunan Nusantara (PTPN).

Beijing Yawan HSR Co. Ltd. is a consortium of Chinese railway companies that jointly formed KCIC.

This Chinese consortium includes Sinohydro, China Railway International (CRIC), China Railway Engineering Corporation (CREC), China Railway Rollingstock Corporation (CRRC), and China Railway Signal and Communication (CRSC).

Editor : Adi Ahdiat

"Disclosure: This is an AI-generated translation of the original article. We strive for accuracy, but please note that automated translations may contain errors or slight inconsistencies."