Indonesia's High-Speed Rail Project: Messed Up Diplomatic Triangle

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- Today's topic was one of the most requested by our viewers so far: an interesting, mega railway project, which is currently under contruction - Jakarta-Bandung High-Speed Railway Line in Indonesia.

It is a high-speed rail line in the length of 142,3 km (88,4 mi), that will connect Indonesia’s capital Jakarta with Bandung, one of the major industrial hubs in this country.

In addition to its complexity, this project is super interesting due to the fact it represents another amazing example of how geopolitics influence the railways and the example of competition game between two Asian powerhouses - China and Japan. In this case, over the greater strategic influence in the region of Asia-Pacific.

For the construction, management, future daily operation and maintenance of Jakarta-Bandung high-speed rail line, the joint venture Kereta Cepat Indonesia China (KCIC) was formed, consisting of Chinese and Indonesian consortiums.

On October 16th 2015, Chinese and Indonesian companies that are part of these consortiums officially signed a deal to proceed with the construction. The project was estimated at $5.5 billion, while China Development Bank (CDB) gave a commitment to fund 75% of this amount, with the loan on the period of 40 years, while the rest will be secured by the joint venture partners.

As Indonesian government was not required to provide any financing, in accordance with the agreement, it will take over the ownership of the line and all the assets only at the end of the 50-year period.

This project is marked as a turning point in the modernization of the Indonesian public transportation system, and it serve four main stations (Jakarta, Karawang, Walini and Bandung), with the trains running at 350 kmh, cutting the travel times beetween the two cities from 3 hours to 40 min.

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[Sammysnows]

If you are living in Indonesia and goes to wet market

You will often found a mother bargain but still not satisfied then saying "I'll be back" But instead going to other sellers that give better deal then try to bargain again to the 1st seller so it comes with better price

That method still being used and surprising works well.

[sp-tjye]

Wishing this project may bring more prosperity to Indonesia. Wishing all Indonesians all the best for this project from India 🇮🇳

[ALWH]

Indonesian HSR is ready to open to public this summer. Congratulations.

[MrJimheeren]

And all of this will be done before California finally finishes his high speed rail. Mark my words

[daewakilat]

Thank you so much for this. FInally, as an Indonesian, i can understand the situation much better.

[soonleongong]

No worries about the profits of the railway road. When it's connected, the economic and lifestyle will definitely improve for Indonesians. That's the reason why Japan also invested in high speed railway themselves. God bless the Indonesians, from Singapore.

[ExitTwo]

A very beautiful country.
The world is a better place when indonesia moves forward. The language is so nice to hear, like music to my ears.

[RSID]

As a native Jakartan, I fully support the high-speed rail projects that can help my friends and co-workers get to their native cities quickly and efficiently. It will also help ease the overpopulation of Jakarta when people can get from city to city more quickly. This project is long overdue imho.

[Ackk]

Wow even as indonesia citizen i still lack information of this railway. Cause our country media tv seem to love more tiktokers and other useless thing to be show on their media

[Wiratama]

Some additional information about this project

1. The plan are actually had been concept as far as 2006, finalized in 2009. JICA was tasked by the government to make plan document and feasibility study.
2. Joko Widodo predecessor, Susilo Bambang Yudhoyono make target to start this project 2014, but stalled by economy stagnation
3. When Joko Widodo elected in 2014, he was doubt the beneficiary of this project and also how expansive this project. But there's also some people who urged to build this high speed railway due to traffic congestion in highway and the existing railway are too expansive too be upgraded due to geographic issue.
3. So it's decide to build the high speed railway but didn't use state fund, instead it's purely B2B business concept. Japan still want state fund guarantee but China step up the bargain and willing to use B2B concept for funding. So China win.
4. The reason why using B2B because government doesn't want to use single dime to fund this project. Most of dime in infrastructure is being used for build highway, water reservoir, irrigation, port, airport, and upgrade existing railway.
5. While Japan know for high quality of infrastructure, it highly criticize for not doing transfer technology, high maintenance cost, and slow building process (MRT Jakarta is the example). China willingness to share technology become plus point of this bidding.
6. The bidding process actually repeated due to government want to B2B concept.
7. KCIC is JV company, where 60% owned by JV Indonesia state company, the rest come from JV China company.
8. In Indonesia law, subsidiaries company or JV company from state owned company are treated as private company. Therefore Indonesia consortium in this project is actually private company. They also not get state funding.

[adrianusramon]

Indonesian who live in Bandung here. To be honest, I never heard of such plan to continue the Jakarta - Bandung HSR eastward using the southern route. Compare with the northern route, the southern route should be many times more expensive due its mountainous features. The most economically feasible route should be using the northern one although it might be slightly bend southward in Semarang toward Solo and Yogyakarta presumably using the similar route as the trans-Java Highway network. You might want to take a look on that.

[dwchen]

Do bare in mind that Java island is the most populated island on the planet with over 141 million people(more than half of Indonesian total population), the size of Java island is almost the same with England(Scotland and Wales excluded) but filled with more than twice the number of people in it.
Java island is also the center of political and economic activity of the country but having a poor infrastructure, especially transportation connection between cities.
So this high speed train project for the long run is much needed in the island to connect the biggest city in the east side of the island to the biggest city on the west side of the island.

[shotelco]

RE: *Economic and Viability Risk* -> High-speed trains usually have higher occupancy rates than regular trains, which “are on average 35 % full. Data point: High speed trains in France currently enjoy 80% occupancy”

Data point: At the time the Korean high-speed line opened in 2010, the average number of passengers was 72, 000 per day, but this has now doubled to approximately 162, 000 in just 10 years. The expectation is this will double again within 8 years.

Data point: Morocco’s high-speed train (Al Boraq) has been in operation for less than 2 years, and already is at 68% occupancy. Morocco just announced the purchase of more trainsets.

High speed rail - when executed correctly - changes everything for a Country. Morocco now sees 160 fewer car accidents between Tangiers and Casablanca. More high(er) net worth individuals will consider relocating themselves and their operations to Nations with modern transportation infrastructure. Workers can live further out from the City Centers, which creates less City traffic and pollution. Companies will employ more as labor cost may be reduced.

I see no long term downside risk for Indonesia regarding this investment.
BTW, this is one of the better presentations I have seen, great job!

[gordonchao]

Most of the problems you said that may happen are also problems that people speculated would happened when China built its first HSR.

[adnanmizfary]

Love this explanation! While in our own media, it is usually fueled by hatred or too highly opiniated without seeing the actual fact.

[ramliremeli]

Indonesia amat bercita cita tinggi dlm menyiapkan project HSR ini... Bukan mimpi... Bukan drama sinetron.... hebat skali...

[adiabd]

Finally, there's a good use of *slow* drone footage shot by those youtubers as stock footage. Nice video essay btw

[klausschumacher]

I think the ticket price of 35 US$ from Bandung to Jakarta is too high and many traveller will use the bus or the travel minibus. After 22 years living in Bandung l mostly use the Trans Travel what was very cheap and convenient. 7 US$ in 2017 from Bandung to Soekarno Hatta airport. I left Indonesia 2017 after a wonderful time and now l am retired in another beautiful SEA country The Philippines.... Good luck Indonesia ❤️👍

[flaklognon]

tech transfer to be able to produce your own replacement parts seem to be a deal breaker in a lot of cases, if you go with japan the maintenance parts are priced thru the roof because they are all made in japan.

[GyacoYu]

11:50 The Chinese train ticket has unified domestic price except for those of Guangzhou Railway Group, so there's no point you should mention Nanjing-Shanghai to be wealthy because those of Yunnan has the same price. The Chinese domestic one are cheaper because China Railway (CR) receives giant amount of government subsidy to boost the economy (conventional trains has not changed ticket rate for 3 decades and if you understand the economy of China in 1990s you'd understand how cheap it must have been). If Indonesian government wants to do the same they're very welcomed to do so. Train services in China is a government-sponsored welfare, you can never compare any commercial service with a welfare, can you?