Indonesian rail project halted over tender documents

2 February 2016

A groundbreaking $5.5bn deal for China to develop Indonesia’s first high-speed railway has been halted just one week after Indonesia’s president chaired the project’s opening ceremony (pictured).

The Jakarta Post reported the deal had been put on hold because PT Kereta Cepat Indonesia China (KCIC), a joint venture between an Indonesian consortium and China Railway International, had not submitted the correct documentation.

Indonesian president Joko Widodo chaired the high speed rail line's opening ceremony. © Press Association Images

China had originally won the highly-sought deal in the face of stiff competition from Japan.

The deal had been regarded as highly significant by analysts, as it was the first time China had won a contract to build an overseas high-speed rail network.

Chinese premier Li Keqiang has urged Chinese companies to seek high-profile overseas contracts.

The line – which will span 142.3km from Jakarta to Bandung – would also be South-East Asia’s first high-speed rail link and a key strategic battleground in the fight to win contracts to develop further rail links around the region.

Local media reported that Indonesian authorities had been unable to read some of the documentation submitted with the project as it was in Chinese.

They also said Indonesia’s transport minister had sought written guarantees the landscape would be restored to its original condition if the project was abandoned before completion.

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