Indonesia on Oct. 2 introduced Southeast Asia’s first-ever high-speed railway, part of China’s Belt and Road Initiative (BRI), which will help to connect two of the country’s largest cities.
President Joko Widodo inaugurated the 88-mile rail at the Halim station in Jakarta. The railway connects Jakarta and Bandung, and its trains travel at speeds up to 217 miles per hour, the fastest in Southeast Asia.
The $7.3 billion project was constructed by PT Kereta Cepat Indonesia-China (PT KCIC), a joint venture between an Indonesian consortium of four state-owned companies and China Railway International Co. Ltd.
The trains have been modified to suit Indonesia’s tropical climate and are equipped with a safety system that can respond to emergencies such as earthquakes and floods. It can accommodate up to 601 passengers.
Ticket prices hadn’t been finalized as of Oct. 2, but PT KCIC estimated that one-way prices per passenger would range from 250,000 rupiah ($16) for second class to 350,000 rupiah ($22.60) for VIP seats.
The project had been plagued by delays and setbacks. The railway opening was initially scheduled for 2019 but was delayed over land ownership disputes, environmental issues, and the COVID-19 pandemic.
The rail deal was signed in October 2015 after Indonesia selected China over Japan in fierce bidding. It was financed with a loan from the China Development Bank for 75 percent of the cost. The remaining 25 percent came from the consortium’s own funds.
The railway faced bad news for investment return after Mr. Widodo announced that the government would relocate the nation’s capital from Jakarta to East Kalimantan in 2024.
Dwiyana Slamet Riyadi, president director of PT KCIC, said last year that the expected demand for the railway has dropped from a previous estimate of 61,157 passengers per day to just 31,215 as a result.
Beijing’s Debt-Trap Diplomacy
China is one of Southeast Asia’s largest sources of foreign direct investment. Beijing has poured billions of dollars into infrastructure projects across Africa, Latin America, Eastern Europe, and Asia through BRI projects.The United States and other nations have criticized Beijing for using “debt-trap diplomacy” to exert pressure on participating countries. Many countries have surrendered pieces of their sovereignty after failing to pay off Chinese debts, notably Sri Lanka, which leased its Hambantota Port to China for 99 years to convert its owed loans of $1.4 billion into equity.
“We have exported a load of oranges to China. They have tripled their exports to Italy in three years. The most ridiculous thing then was that Paris, without signing any treaties, in those days sold planes to Beijing for tens of billions,” he told the Corriere della Sera newspaper, according to an English translation.
