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Friday, October 16, 2015, 14:12

China, Indonesia seal Jakarta-Bandung rly deal

By Xinhua
China, Indonesia seal Jakarta-Bandung rly deal
Construction for the Jakarta mass rapid transport system is seen in Jakarta's business district on October 16, 2015. (Photo / AFP)

JAKARTA - Senior officials of Chinese and Indonesian consortiums signed an agreement here on Friday to launch a joint venture for a railway linking national capital Jakarta with the West Java provincial capital of Bandung.

The deal was signed by Chairman of PT Pillar Sinergi BUMN Indonesia Sahala Lumban Gaol and Yang Zhongmin, chairman of China Railway Co. Ltd. at a ceremony attended by Chinese Ambassador Xie Feng.

The US$5.5-billion project will be conducted on a business to business basis in which the Indonesian side controls 60 percent of the joint venture, while the Chinese partner holds a 40 percent stake.

The 150-km high-speed tracks will have trains running at a speed of between 200 to 250 km per hour.

Ambassador Xie said the project will be China's first executed overseas entirely with Chinese technology and carrying the largest investment value.

"The high-speed railway connecting Jakarta and Bandung has resulted from the agreement of both countries' leaders upon the need to synergize strategies to attain higher growth," he said.

The project was part of the two countries' initiatives to materialize "the 21st century Maritime Silk Road" and "World's Maritime Axis" through pragmatical cooperation between Indonesia and China in various sectors.

The ambassador pointed out that it would serve as an Indonesia-China model of cooperation that is mutually beneficial to both countries.

"This is a brand new initiative in Indonesia, particularly when it comes to transportation projects as it will further boost economic activities in areas along the corridor served by the high-speed train which will eventually contribute to national economic growth," Sahala said.

The railway is the first transportation project in the country conducted solely on a business initiative and without any government funding.

Sahala also expected the Indonesia-China joint venture to expand to include similar projects in Southeast Asia and the Middle East in future.

The Chinese side was also willing to provide transfer of technology (TOT), which would help build facilities to produce high-speed trains in Indonesia and supply them to new markets served by the joint venture, he said.

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