Coordinating Economics Minister Darmin Nasution, left, in this file photo. (Antara Photo/Puspa Perwitasari)

Govt to Incentivize 30 'Priority' Infrastructure Projects: Minister


FEBRUARY 10, 2016

Jakarta. The Indonesian government has identified 30 infrastructure projects as top priority projects, raising the prospect of a number of incentives as well as promises of government assistance within the next four years, as part of a strategy to accelerate infrastructure development across the country.

According to Coordinating Minister for Economic Affairs Darmin Nasution, the selected projects will receive "various facilities to ensure acceleration" through the Committee for Acceleration of Prioritized Infrastructure Development (KPPIP), which includes, among others, offering assistance with their business plan through a professional consultant group, debottlenecking assistance, as well as other incentives in order to implement the project.

KPPIP is a committee tasked by the government to formulate strategies and policies for infrastructure development projects that are deemed to be particularly important. The committee is also responsible for monitoring and aiding selected projects, with an annual budget of some Rp 80 billion ($5.9 million) every year.

The 30 priority projects  a mix of public and private partnerships, sole-government projects and state-owned enterprise projects  include the Trans-Sumatera toll road that will stretch 2,818 kilometer along Sumatra, a 2000-megawatt (MW) coal-fired power plant in Batang, Central Java, and the Bontang oil refinery in Kalimantan.

Three water sanitation projects in Jakarta and East Java are also included, along with the government's plan to revitalize 10 airports across Indonesia as well as a Mass Rapid Transit line connecting the southern area of Jakarta to its northern parts.

"Infrastructure is an important pillar in national development. While we've been aware of this for a long time, we've been neglectful to actually implement [the plans]," Darmin said at an infrastructure outlook event in Jakarta on Wednesday. "We need a champion to guard the implementation of infrastructure development. This will be the KPPIP."

Some of the priority projects have already commenced construction, such as the Jakarta MRT, while some are either in the early stages of building or still waiting for funding, according to Luky Eko Wuryanto, chief of KPPIP. Several projects are also still in the evaluation stage, meaning that the appropriate funding scheme has not been decided as yet, Luky said.

Still, Luky noted that the committee aims to keep the projects on track for completion by 2019, with a goal to start picking the winners of some of the projects before the end of the year. "[Only] then would we know when the projects are due [for completion]," he added.

Aside from the priority projects, KPPIP is also tasked with monitoring the progress of 225 other projects deemed to be of national strategic importance. In addition the KPPIP is also monitoring the progress of state power operator Perusahaan Listrik Negara's program to roll out an additional 35,000 megawatts worth of plants by 2019.