Indonesia’s high-speed rail boosts business and connectivity

Opportunities for business have been rising from other cities outside Jakarta

Indonesia is establishing its first high-speed train between Jakarta and Bandung. AlgiFebriSugita/Shutterstock

Indonesia is an attractive country for entrepreneurs due to its large population and high-growth economy. Indonesia Expat reports that despite Bahasa Indonesia being the official language, businesses in major cities such as Jakarta are mostly conducted in English. Being a member of multinational organisations such as ASEAN and G20, growing businesses in Indonesia can help expand connections with its trading partners.

Bandung is an ideal place for creative and startup businesses due to its focus on developing high-end creative industries, as well as its potential as Indonesia’s Silicon Valley. Additionally, the city attracts many tourists, providing opportunities for retail business development.

This is why Indonesia is establishing its first high-speed train between Jakarta and Bandung. Benar News discussed Indonesia’s first high-speed train, the Jakarta-Bandung rail project funded by China. The project’s estimated cost has increased to IDR107.9 trillion (USD7.2 billion), up from IDR89.9 trillion (USD6 billion), and the interest rate for the project loan remains at 3.4 percent, despite Indonesia’s request for a lower rate.

Related: Capital gains: Indonesia’s economic growth and real estate boom fuel development

The government is negotiating with China on the loan tenure and grace period for repayment, and President Joko Widodo has agreed to fund IDR2.9 trillion of the cost overrun through capital injection. The new rail line is expected to reduce travel time between Jakarta and Bandung to 34-45 minutes from 2.5 hours by regular train.

According to The Diplomat, the Jakarta-Bandung High-Speed Railway, will begin operations in August after years of delays and cost overruns. The rail line, a key part of China’s Belt and Road Initiative (BRI), is set to link Jakarta to the city of Bandung, easing congestion along one of the most densely populated travel corridors in the world. The project has been spearheaded by the Indonesian-Chinese consortium PT Kereta Cepat Indonesia China (KCIC) and has faced delays due to land acquisition complications.

The Property Report editors wrote this article. For more information, email: [email protected].