State-owned Enterprises Minister Rini Soemarno said that the Jakarta-Bandung fast train project would be funded by China Development Bank.
“The project] has nothing to do with loans taken by three state-owned banks from China. The loans are for their own business purposes,” Rini said in Cirebon on Friday, October 16, 2015.
According to Rini, the fund for the project would be directly disbursed to the consortium with a 40-year tenor and an annual interest rate of 2 percent. Meanwhile, the loans from China for state-owned banks (for the different purpose) were given with a 10-year tenor.
Rini added that the debt repayment process for the high-speed train project would be fully handled by the consortium.
“The loan would be handled by the consortium. China and Indonesia share the responsibility to return the loan,” Rini said.
Rini revealed that 60 percent of the total cost for the project, which amounts to Rp70 trillion (US$5 billion), would be spent domestically. Meanwhile, 40 percent of the loan would be repaid by Chinese consortium.