Speaking to reporters Friday in Tokyo, Japan’s Chief Cabinet Secretary Yoshihide Suga said Japan will decide what it will do after receiving a detailed explanation from the Indonesian government about cancellation of what would have been the country’s first high-speed rail system. Japan’s Asahi Shimbun said high-speed rail link in Malaysia, Singapore, India and Thailand may reach a total of 10,000km in the future.
Top Japanese government spokesman Yoshihide Suga confirmed that the new line would not be financed or guaranteed by the state, quoting the Indonesian government, and said Japan would need to consider its options.
“The president has decided not to make it a high-speed train”.
“The project was a priority for China because it would have been one of the first and most visible manifestations of President Xi Jinping’s “One Belt, One Road” overseas investment drive”, said Tom Rafferty, Beijing-based analyst at the Economist Intelligence Unit.
Over the past few weeks, the president has reshuffled his economic team, announced plans for a new stimulus package and showcased the start of major infrastructure projects, such as a $4 billion coal-fired power plant.
The two Asian powerhouses had been locked in a contest for months to build the railway, a line connecting the sprawling capital Jakarta with the mountain-fringed city of Bandung about 160 kilometres (100 miles) away. “The government will not provide any viability gap fund. The cooperation will be under a business-to-business scheme”.
“That’s the main difference”, state-owned enterprises (SOEs) minister Rini Soemarno told reporters.
While a medium-speed line might not be as sexy, Nasution welcomed China and Japan to bid on that, too.
Asked about the impact of the high-speed train project on social and economic life, Nasution said the potential impact was being evaluated. That has put China in competition with Japan, which sees high-speed rail as a promising export as Prime Minister Shinzo Abe fights to revive the economy.
The Indonesian side “explained that it will be conducted purely as a private project”, Suga said.
Companies from China and Japan had taken part in an intense bidding process to build a high-speed train with speed of over 300 kilometers per hour.
Meanwhile, Chinese Ambassador to Indonesia Xie Feng refused to give a statement after meeting with Darmin.