Indonesia weighs opaque debt-shifting plans for loss-making high-speed rail

After three years of operation, the Whoosh high-speed rail line between Jakarta and Bandung continues to lose between Rp4 trillion and Rp5 trillion annually, with passenger traffic at only half the target. The project also requires yearly debt installments of about Rp2 trillion to the Chinese government that financed it. To address the mounting liability, the Ministry of Finance is evaluating three alternatives: transferring the Pilar Sinergi BUMN Indonesia (PSBI) shares to the Indonesia Investment Authority, creating a joint venture between INA and Sarana Multi Infrastruktur, or assigning responsibility to Danantara, the state-owned holding company.

All three routes would shift the debt into quasi-fiscal entities, keeping the burden on public funds but reducing parliamentary oversight. Observers contend that the scheme masks the financial strain and should hold former President Joko Widodo accountable for initiating the project without adequate study.