Ministry to call for tenders for seven toll road sections

Ministry to call for tenders for seven toll road sections

Illustration - Toll road section (ANTARA/M Razi Rahman)

Involvement of the private sector has an impact on the leverage of their investment, so the profit can be used to develop other infrastructure.
Jakarta (ANTARA) - The Public Works and Housing Ministry plans to call for tenders for the construction of toll road sections this year.

"Under the KPBU (government-corporate body cooperation) scheme, the government aims to address the lack of funding for the development of infrastructure, particularly toll roads, so they could be completed on schedule to offer real benefits to the state and nation," Public Works and Housing Minister Basuki Hadimuljono noted in a written statement released on Monday.

Related news: Indonesia's toll road development must catch up with other countries

The Public Works and Housing Ministry, through the Toll Road Regulatory Body (BPJT), will call for tenders for the construction of seven toll road sections, with a total investment of Rp151.13 trillion.

The seven toll road sections are the Semanan-Balaraja section spanning 31.9 kilometers in length; Kamal-Teluknaga-Rajeg section measuring 38.6 kilometers in length; road access to Patimban Port, with a length of 37.7 kilometers; Gedebage-Tasikmalaya-Cilacap section of 184 kilometers in length; Yogyakarta-Bawen section reaching 77 kilometers in length; Solo-Yogyakarta-New Yogyakarta International Airport (NYIA) Kulon Progo section of 91.93 kilometers in length; and Balikpapan-Penajam Paser Utara section, with a length of 7.35 kilometers.

Of the seven toll road sections, the Balikpapan-Penajam Paser Utara section was put out to tender under the right to match method, with PT Tol Teluk Balikpapan as the winner. The designs of other toll road sections are being finalized.

"Involvement of the private sector has an impact on the leverage of their investment, so the profit can be used to develop other infrastructure," he noted.

The government has provided viability gap fund (VGF) in the form of guarantee and funding support from the state budget to finance part of the toll road construction, so that it can increase the financial viability of the toll road section.

Private investment is necessary to develop the toll road sections owing to lack of the government's infrastructure funding. Through the state budgets from 2020 to 2024, the government will solely be able to meet 30 percent of the Rp623 trillion required to build the toll road sections. Overall, funding requirements for infrastructure development during the time period are projected to reach Rp2,058 trillion. Related news: Awaiting Jokowi`s insightful responses to questions on toll roads By Rahmad N

Related news: PT PP bags tender to construct Semarang-Demak toll road


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