Indonesia Tackles Gridlock With Subway Plan

Jakarta, Indonesia (News Today) - Indonesian leaders are battling their capital's deepening traffic woes with plans to build the world's next major subway system.

Southeast Asia's largest economy has long suffered from big deficiencies in power, road and other infrastructure, but a succession of governments have repeatedly failed to deliver projects to fill those needs. The subway plans are a test for the government in its fight against the country's reputation for inefficiency. President Susilo Bambang Yudhoyono has vowed to make headway in fixing Indonesia's infrastructure problems before his second and final term ends in 2014.

Analysts say Indonesia's infrastructure shortcomings drive up the cost of doing business and are one reason the country is growing less rapidly than China and other Asian economies. Indonesia's economy is expected to tally 6% growth this year, compared with 9% to 10% in China.

In Jakarta, the world's 11th-largest city with more than 10 million people, vehicles move at an average of 13 to 15 kilometers, about 8 to 9 miles, an hour, according to Danang Parikesit, chairman of the Indonesian Transportation Society, a think tank and advocacy group. Average speeds are declining by about one kilometer an hour each year, analysts say.

Bangkok, known for its gridlock, bottomed out at around 12 kilometers an hour before it opened a pair of urban train lines over the past 12 years; traffic has since improved.

“If we don't make a breakthrough, the public cost of congestion will be enormous,“ Mr. Parikesit says. Traffic problems already cost businesses and commuters more than $3.1 billion a year in wasted fuel and lost work time, according to the University of Indonesia.

“Business could be better if the traffic in Jakarta wasn't as bad as it is now,“ says Tri Anggraeni, corporate secretary at DHL Supply Chain Indonesia, a unit of Deutsche Post AG. She says the logistics company has little choice but to brave the roads, and that gridlock extends well beyond the city center of the city -- it now takes three days to transport goods by truck from Jakarta to Surabaya, about 470 miles away, for example

Officials say the planned $1.6 billion train system will help. The first phase, to begin construction next year, is expected to cover a 9.7-mile route in roughly 30 minutes, with 13 stops in the central city, including one near the iconic Hotel Indonesia. Some stops will be underground; others will be elevated. The city-owned company MRT Jakarta, which is managing the train project, says the line will be able to handle as many as 300,000 passengers a day after it opens in 2016.

Mr. Yudhoyono has made repeated efforts since taking office in 2004 to attract foreign investors to fund infrastructure projects, but most have steered clear, blaming regulatory confusion, corruption and multiple local, provincial and national jurisdictions with complex power-sharing rules.

A plan launched in 2005 to build 625 miles of toll roads is incomplete but inching ahead, in part due to problems with land acquisition. A $600 million monorail project in Jakarta that started construction in 2004 and was to begin operating as early as 2006 has ground to a halt amid disputes among its backers over financing and other issues.

“It's a disgrace that Jakarta is the only major city in Southeast Asia, in fact in Asia now, that does not have a subway system or a mass transit system“ with trains, says Nick Cashmore, an analyst at investment bank CLSA in Jakarta. “I think you will find there's a general assumption that nothing will change.“

More optimistic analysts point to recent infrastructure successes. Mr. Yudhoyono set up a special unit last year to clear red tape for infrastructure projects and appointed a well-regarded technocrat who helped manage successful reconstruction efforts after the 2004 tsunami to head the group.

Officials in Jakarta have made significant progress in improving flood control in the city, residents say, and developers are making headway on a power plant-building program launched by the government in 2006.

The “Mass Rapid Transit“ idea dates back 20 years. But initial enthusiasm for the MRT cooled after officials determined that ticket revenues wouldn't be enough to cover the cost of private financing. In recent years, as traffic worsened, interest in the project has revived.

In 2008, officials set up MRT Jakarta to manage the train project. In 2009, Indonesia secured low-interest loans from the Japan International Cooperation Agency that are expected to cover as much as 85% of the cost of the project. The government promised to fund the rest.

“A big issue when we started the project was that we had too many engineers-- but nobody knew about finances,“ says Eddi Santosa, a civil engineer who is chief corporate and planning officer for MRT Jakarta. “People are expecting a lot from us. This is our chance to perform.“

Some residents question whether even an operational MRT will make a dent in Jakarta's gridlock.

But some skeptics are growing more optimistic. Mr. Parikesit of the Indonesian Transportation Society says that a year ago, he would have predicted the project would never happen. Now, he says, “my guess is that it will go,“ though it may take awhile.

“The government of Jakarta has really high pressure on it to get it done,“ he says. “I don't think it will look good if they delay any further.“

Source : kompas

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