THE Japan International Cooperation Agency (Jica) signed an agreement on May 13 with the government of Indonesia to lend up to Yen 140.7bn ($US 900m) for Phase 1 of the MRT metro East-West Line project in Jakarta.

The loan has an annual interest rate of 0.3% and 0.2% for consultancy services, and is to be repaid over 40 years with a 10-year grace period.

The East-West Line will run for a total of 84.1km from Balaraja to Cikalang. The Jica loan will fund civil works, tracklaying, electrical and mechanical systems, depot construction and consultancy services including basic design and construction supervision for Stage 1 of Phase 1, running for 24.5km from Tomang to Medan Satria.

Jica will also fund the procurement of 184 metro cars, and the basic design of Phase 1 Stage 2 from Kembangan to Tomang (9.2km), and Phase 2 comprising the Balaraja - Kembangan and Medan Satria - Cikalang sections (50.4km in total).

Phase 1 Stage 1 is expected to open in June 2031. Tendering for consultancy services including detailed design work and construction supervision, and main construction works, is due to start in the first half of 2025.

The total cost of the work that the Jica loan is part-funding is Yen 745.2bn.

The East-West Line project aims to address growing transport demand, facilitate modal shift from the private car to public transport and alleviate traffic congestion. Jica says it will also improve the living and investment environment while furthering environmental impact reduction and climate change mitigation.

Special Terms for Economic Partnership (STEP) apply to the Jica loan, meaning that the main contract is tied to Japan while subcontracts are generally untied. The main agreement partner must be a Japanese company, an overseas subsidiary of a Japanese company, or a joint venture between a Japanese company and the borrowing country where the Japanese company is the lead partner.

In the case of East-West Line Phase 1, the Japanese technology that will be used includes mud pressurisation shield tunnel boring machines (TBM) to build underground sections, as well as rolling stock and signalling.

“The Indonesian government is planning to hold a groundbreaking ceremony this August,” says Mr Yasui Takehiro, Jica’s chief representative for Indonesia.

“But construction will likely start next year.”

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