Wide range of high value opportunities for UK companies with expertise in the rail sector as Indonesia seeks to develop its railways infrastructure.

Market overview

Indonesia is the fourth most populous country in the world and is rich in natural resources. However, Indonesia is unable to fully capitalise on its resources owing to challenges in their transport infrastructure.

The Indonesian central and local governments recognise that rail will provide the mechanism achieve this through increasing exports, supporting growth in the country, while at the same time reducing the environmental impact of their transport and increasing the quality of life for its inhabitants.

Currently UKTI is involved with the following rail projects in Indonesia:

Soekarno Hatta International Airport Rail Link (SHIARL)

The SHIARL aims to provide an express railway transportation facility connecting Jakarta’s international airport and the city centre (Manggarai train station). In November, 2011, the Ministry for Transport signed an agreement with PT Sarana Multi Infrastruktur (PTSMI), a State-owned company to facilitate the acceleration of Indonesia’s infrastructure development and to manage the necessary preparations to kick-start the project under PPP scheme. The airport connection remains a high priority and the Ministry for Transport is willing to speed-up the implementation of this project to help ease traffic congestion to/ from the airport, with the tender process for the PPP likely to be Q2 of 2014. The SHIARL is valued at £1.4bn (US$ 2.57bn) and scheduled for operations in 2018.

Jakarta Mass Rapid Transit (MRT)

The Jakarta MRT aims to provide an express route across Jakarta, traversing north south (approximately 23.8 kilometres) and east to west (approximately 87 kilometres). The Jakarta MRT is split into three parts, with the two sections for the north- south route. The current status for the works is as follows:

• Phase 1 – North South section consisting of 13 stations, including underground and over sections. Construction contracts have already been let to three sets of Japanese consortia. The pre qualification process for the Rail Systems and Rolling Stock Contracts are currently undergoing Prequalification. This is targeted to operate by the end of 2016.

• Phase 2 – North South section consisting of 7 underground stations. The pre-feasibility study has been completed and environmental assessment is underway. This is targeted to operate by the end of 2018.

• Phase 3 – East west section. A pre-feasibility study is underway and the scheme is targeted to operate 2024-2027.

The overall budget for the scheme is in excess of £1bn (JPY 144bn)

Jakarta Eco Transport (JET) Monorail

• The Jakarta JET Monorail aims to provide two lines within Central Jakarta, as well as the future potential to link to Greater Jakarta. The routes being provided as part of the Central Jakarta project are as follows:

• Green Line – a circular route (14.3 kilometres) around Jakarta, consisting of 16 stations and elevated section works, scheduled for operation in 2016.

• Blue Line – a north west to south east route (13.7 kilometres) through Jakarta consisting of 14 stations and elevated works, scheduled for operation in 2017.

The project is valued at £1bn and has been awarded to a Chinese Consortium. However, opportunities remain as specialist suppliers within the supply chain.

Key opportunities

In summary these projects have the following opportunities for UK firms:

• planning and development, including master planning, environmental consultancy, financial and legal planning

• architectural and engineering design services

• project and commercial management

• rail technologies, including product supply

• rolling stock components

• operations and maintenance

• construction firms

Latest export opportunities in the Railways sector

Latest export opportunities in Indonesia

Getting into the market

Presidential Regulation No. 54/2010 which came into effect on 1 January, 2011 governs, among others, procurements by ministries, state-owned enterprises, funded in part or entirely from domestic loans or grants received by the government, financed in part or entirely from international loans or grants.

Public tender is the standard method of procurement. In all public tenders, information is published on the procuring entity’s website, the formal notice boards, increasingly, the Electronic Procurement Service portals.

Foreign companies are allowed to bid in cooperation with a national company (unless no national company has the ability to provide the goods or services requested) and only on bids that exceed a certain threshold e.g. IDR 100 billion (approximately US$ 10 million) for construction services.

Most companies use the website of the National Public Procurement Office and printed media as a source of information about calls for tenders.

More about doing business in Indonesia

Contacts

Market intelligence is critical when doing business overseas, and UKTI can provide bespoke market research and support during overseas visits though our chargeable Overseas Market Introduction Service (OMIS).

To commission research or for general advice about the market, get in touch with our specialists in country – or contact your local international trade team.

• Lian Jap, British Embassy Jakarta. Tel: +62 (21) 2356 5265 or email: lian.jap@fco.gov.uk

• Lina Wati, British Embassy Jakarta. Tel: +62 (21) 2356 5311 or email: lina.wati@fco.gov.uk

Contact your local international trade team

UKTI Events

UKTI runs a range of events for exporters, including seminars in the UK, trade missions to overseas markets and support for attendance at overseas trade shows.

Latest events in the Railways sector

Latest events in Indonesia

Useful links

More about OMIS and other UKTI services for exporters