“The government of China has courage not to ask for guarantees from Indonesia”, Gatot Trihargo, deputy assistant for the state-owned enterprises ministry, said.
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China responded with a modified proposal that did not require Indonesia to shoulder any financial burden, prompting Sofyan Djalil, head of the Indonesian National Development Planning Agency, to inform Tokyo of its decision on September 29.
In a surprise twist, an Indonesian cabinet minister on Tuesday informed Japan that his government is poised to build a high-speed rail line with China.
Indonesia suddenly changed its victor selection policy and accepted the Chinese proposal, Suga said, adding that Tokyo can not understand why things have turned out like this.
Suga doubted the feasibility of the Chinese proposal to build the railway without Indonesian funding. Its budget for the project was 74 trillion rupiah (about 600 billion yen, or $5 billion).
“It defies common wisdom”.
The situation “can only be described as extremely deplorable”, Suga also said.
The line is to connect Jakarta with Bandung, the capital of the province of West Java.
In an apparent effort to soften the disappointment, Teten said there were still many opportunities for Japan to invest in Indonesia’s infrastructure sector.
The rail project is a key part of Widodo’s drive to build more infrastructure. He pledged upon taking office in October to overhaul Indonesia’s ageing roads, railways and ports but has struggled to get his agenda moving.
According to high-ranking Indonesian government officials, China’s modified proposal means that the trains will run at slower speeds.
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The announcement was shocking in that Japan has a reputation for building world-class trains that have never had a fatal accident. China has less experience (it started to develop its first high-speed train service in the late 2000s) but has shown remarkable growth in recent years (the country now claims that over half of the world’s current 23,000 km of high-speed railway tracks is made by China). However, its safety standards have come under scrutiny: A 2011 crash killed at least 40 people and injured about 200.
