Indonesia will seek more financing from China to cover most of the $2 billion in cost overruns for the Jakarta-Bandung high-speed rail project, which is part of Beijing’s Belt and Road Initiative infrastructure scheme, local media reported, citing a project official.
The 88 mile (142 kilometer) rail project connecting Jakarta and Bandung was projected to cost around $4.57 billion when it was awarded to a consortium of Chinese and Indonesian state firms—namely PT Kereta Cepat Indonesia China (KCIC)—in 2015.
But costs have since ballooned to about $7.9 billion due to escalating raw material prices and other unforeseen costs.
According to Indonesian news agency Tempo, Dwiyana Slamet Riyadi, president director of PT KCIC, said on April 21 that while consortium shareholders have “the obligation” to cover the cost blow out, additional parties may be necessary to assist in securing funding.
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