Jakarta. State-owned Bank Mandiri, Bank Rakyat Indonesia and Bank Negara Indonesia are ready to participate in financing the Jakarta light transit project, which will allow the work to continue, the lenders' top executives said earlier this week.
The government said last month that there is not enough money in the state budget to fund the Rp 23 trillion ($1.7 billion) project and that it would allow private sector funding to ensure the transportation system will be in operation by the end of May 2019.
As a funding alternative, the government suggested that the current contractor, state-owned construction company Adhi Karya, establish a consortium with other investors and raise funding for the project. The government will only provide guarantees for the project.
"We plan to participate in financing the LRT. The plan is a syndicated loan with many banks," said Kuswiyoto, director of institutional and state-owned enterprises at BRI.
The LRT project could provide a solid opportunity for the bank to expand its infrastructure lending by 30 percent to Rp 59 trillion this year, he said.
BNI president director Achmad Baiquni and Bank Mandiri president director Kartika Wirjoatmodjo also said they would be involved in the LRT project, as the infrastructure sector would remain the focus of their loan portfolios this year.
However, the lenders said they are still waiting for the government to complete its assessment of the ideal funding scheme for the LRT project.
The government has promised to come up with a final decision on the funding by next month. Adhi Karya has so far spent Rp 2 trillion from its own pocket to carry out the construction.