TRANS SUMATRA ROAD PROJECT TO BE ACCELERATED TO IMPROVE CONNECTIVITY by Fardah

   Jakarta, July 16, 2013 (Antara) - Sumatra is one of Indonesia's significant economic gates given the fact that its location is very strategic and the island is rich in natural resources.

        The island which spans more than 1700 km and is about 473,606 sq. km, is the second largest in Indonesia after Kalimantan and the sixth largest island in the world after Greenland, New Guinea, Kalimantan, Madagascar and Baffin Island (Canada).

         Having ten provinces, namely Lampung, South Sumatra, Bangka Belitung, Jambi, Bengkulu, West Sumatra, North Sumatra, Riau, Aceh Darussalam, and Riau Islands, Sumatra is among the country's major
producers of palm oil, rubber, coal, tin, steel, liquified natural gas (LNG) and oil.

        Therefore, Sumatra has been designated as a "center for production and processing of natural resources and as the nation's energy reserve" in the first economic corridor of Indonesia's Masterplan for Economic Development Expansion and Acceleration (MP3EI).

        Of the total investment required for the MP3EI's six corridors amounting Rp. 4,012 trillion, the Sumatra Corridor will receive Rp. 714 trillion (18 percent of the total investment) and almost half of the funds will be used for infrastructure projects such as the constructions of highways and railway lines which are crucial to improve the connectivity of Sumatra's cities.

        Coordinating Minister for Economic Affairs Hatta Radjasa said the government has decided to speed up the implementation of Trans Sumatra toll road construction that will connect all provinces in Sumatra island.

           The 2,700 kilometers-long road will cover 23 routes and connect the ten provinces starting from Aceh in the northern-most of Sumatra to Lampung in the south, the minister said.

         He added that state-owned contractor PT Hutama Kaya will be in charge of building the whole construction of the toll road which will cost around Rp300 trillion.

        "The government decides to accelerate the construction of Trans Sumatra toll road which is expected to start this September. The government has allocated Rp2 Trillion from the State Budget to finance the first phase of the project," Minister Rajasa said after chairing a coordinating meeting on the development of Trans Sumatra Toll Road and Sunda Strait Bridge projects in Jakarta, on July 11, 2013.

        The first phase of the Trans Sumatra Toll Road project, which will be built starting September this year, will cover four routes expanding 323.8 km long.

         The four routes are Medan-Binjai route (16.8 km), Pekan Baru-Dumai route (135 km), Indralaya-Palembang route (22 km) and Bakauheni-Terbanggi Besar route (150 km). The funds allocated for the construction of the four routes will be amounting to Rp31.5 trillion, consisting of Rp2 trillion for the construction of Medan-Binjai route, Rp14.7 trillion for Pekan Baru-Dumai route, Rp1 trillion for Indralaya-Palembang route, and Rp13.8 trillion for Bakauheni-Terbanggi Besar route.

          "The Medan-Binjai route is the first and urgent one that will be constructed soon," the minister said, adding that the other urgent routes are Riau-Kualanamo, and Palembang-Lampung.

         The Trans Sumatra toll road has been stipulated in the Presidential Regulation No.86/2011 on the Strategic Area Development and Sunda Strait Infrastructure.
         The Presidential Regulation contains those who will handle the project, with the requirements stating among other things that it will be done by state-owned enterprises whose shares are 100 percent owned by the government.    
    State Enterprises Minister Dahlan Iskan said that the groundbreaking ceremony of Trans Sumatra toll road project's first phase is expected to be held in late September 2013.

          "It will be decided soon, if possible the groundbreaking will be in late September," Minister Dahlan Iskan said after attending the coordinating meeting.

        The toll road will not use existing roads and will not need relocation of houses, according to Subagyo, a director at the public works ministry.

          The cost will be cheaper as it would use lands belonging to state plantations and unused lands, Subagyo added.

         "Plantation companies would be more than eager to offer a small part of their land for the project as it would greatly facilitate the transport of their commodities," he said.

         Public Works Minister Djoko Kirmanto said a feasibility study on the Trans Sumatra toll road project has been completed.

        "The feasibility study has been done and we find out that all sections of the road are economically feasible but not financially feasible," Minister Djoko Kirmanto said.

          For the long term, however, the toll road, which is expected to be fully ready by 2025, will significantly help boost Sumatra's economic development, the minister stated. ***3***
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(T.F001/A/F. Assegaf/A/O. Tamindael) 16-07-2013 09:37:01