In race with Japan, China sweetens bid for Indonesia railway

[CityFarmer]

Asia smaller countries' infrastructure projects benefited from the "race" between China and Japan. A US$ loan with a 50-year tenure, and 2 per cent interest rate, should be an attractive deal...

In race with Japan, China sweetens bid for Indonesia railway

JAKARTA — China has sweetened its bid in a race with Japan to win the construction contract for a high-speed railway connecting Jakarta to the city of Bandung, Indonesia said today (Aug 11).

President Joko Widodo told reporters today the government had hired private consultants to consider the rival proposals for Indonesia's first bullet-train connection and would announce the winner at the end of the month.

The Jakarta Post reported that Japan, which began talks several years ago on building the 150km line, had estimated the cost at at least US$4.4 billion (S$6.16 billion).

Mr Oura Daisuke, a representative with Japan International Cooperation Agency in Indonesia, told Reuters that Japan had offered a 40-year loan at a 0.1 per cent interest rate and with a 10-year grace period. He declined to reveal the loan amount.

China has now improved its initial bid, offering a US$5.5 billion loan with a 50-year tenure, a 2 per cent interest rate and a grace period, Indonesian Development Planning Minister Andrinof Chaniago told reporters today after meeting China's Minister of the National Development and Reform Commission, Mr Xu Shaoshi.

China had initially proposed a US$4 billion loan with a lending period of 25 years and an annual interest rate of 2 per cent, the Jakarta Globe reported.

"There are a lot of changes making (the new proposal) better," Dr Chaniago said.
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http://www.todayonline.com/singapore/rac...ia-railway

[CityFarmer]

It is not an economical , but a high profile political competition. Indonesia is the only winner...  

Racing to beat China, Japan's PM sweetens bid for Indonesia rail project
27 Aug 2015 19:01
[JAKARTA] Japan's prime minister has sent an envoy to Indonesia to offer a sweeter deal to build a high-speed railway, a Japanese embassy official said on Thursday, highlighting the importance of the multi-billion dollar project that China also wants to win.

The two Asian giants are in a neck-and-neck contest to win a contract to build Indonesia's first high-speed rail, between the capital Jakarta and textile hub Bandung, a project that would bolster their influence in Southeast Asia's biggest economy.

Japan and China have until Aug 31 to submit their best offers to Jakarta. "Prime Minister Abe decided this project is very politically important so he dispatched a special envoy to meet President Joko Widodo again," Yoshiko Kijima, attache for economic affairs at the Japanese embassy in Jakarta, told Reuters.

Japanese envoy Izumi Hiroto submitted the fresh proposal to the president late on Wednesday, the second such revision since China sweetened its bid on Aug 11.

Japan is offering a 40-year loan at an interest rate of 0.1 per cent with a 10-year grace period. The latest proposal also offers Japanese government guarantees on financing and increases the percentage of local content.
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Source: Business Times Breaking News

[CityFarmer]

If not due to its political importance, the China and the Japan, might already walk off from the project...

Indonesia scraps high-speed bullet train; seeks new bids from China, Japan
04 Sep 2015 12:26
[JAKARTA] Indonesia is scrapping a US$6 billion plan for a high-speed train because it is not commercially viable and is asking bidders China and Japan to submit new proposals.

The government now wants a slower train capable of travelling at 200 km per hour between the capital Jakarta and the third-biggest city Bandung, the minister coordinating policy for transport, Rizal Ramli, told Bloomberg News on Thursday.

The need for new proposals, which could be 30 per cent to 40 per cent cheaper, will delay the decision by several weeks, he said in his first interview with international media since taking office last month.
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Source: Business Times Breaking News

[CityFarmer]

Hmm..., Japan bullet-train, is definitely a safer option, albeit not a cheaper one. It has been proven by track record, as well as the following reports...

Chinese regulator slams bullet-train makers

BEIJING — China’s railroad regulator, the National Railway Administration, said in a recent report published on its website that a check on the three state-owned bullet train manufacturers found they had several problems related to management, ties with suppliers, and instructions for their equipment.

Qingdao Sifang’s management of its parts and materials suppliers, and outsourcing of projects, was described as chaotic, and the firm was said to lack clear reasons and policies for changing suppliers.

The report said Changchun Railway Vehicles did not provide good instructions for equipment on the cold-weather trains it makes.

It also said that Tangshan Railway Vehicle failed to mark its products with validity dates or the numbers of licences. Its measuring tools used in production were found to be in poor condition.

The manufacturers are owned by China Railway Rolling Stock, which recently formed plans to expand into overseas markets.

A fourth manufacturer for bullet trains, Bombardier Sifang (Qingdao) Transportation, was set up by Sifang Locomotive & Rolling Stock and Canada’s Bombardier. An earlier report by the railway administration said that the joint venture had problems in its management of suppliers.

The rail authority has set up seven bureaus to carry out inspections of rail equipment manufacturing and maintenance companies since it was established in 2013. It has published four reports on its inspections, and Changchun Railway Vehicles has been named twice in them.

The latest report also says the subsidiaries of the country’s railroad operator, China Railway, had problems such as not checking rail equipment routinely, lacking the necessary documents on important parts, and failing to train workers.

The railroad regulator has told the companies to fix the problems.
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http://www.todayonline.com/chinaindia/ch...ain-makers

[CityFarmer]

China wins, in the game...

Japan Says China Wins Indonesia Rail Contract

TOKYO—Japan said Indonesia has chosen China’s bid over its own to build a $5 billion high-speed rail project on the island of Java, ending a drawn-out process that included two unexpected reversals by Jakarta in the past month.

The decision would mark a victory for Beijing as it challenges Japan’s influence in Southeast Asia, where Tokyo has long had closer ties, partly by ramping up investment in infrastructure projects across the region.
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http://www.wsj.com/articles/japan-says-c...1443537614

[desmondxyz]

It will be interesting to see who will win Singapore HSR project....

[CityFarmer]

It will be interesting to see who will win Singapore HSR project....

I reckon, once China has a track record in Indonesia, it will gain an advantage to bid for similar projects in the region.