Economy, Business And Markets

Talks Underway for Investment in Indonesia’s Infrastructure

Talks Underway for Investment in Indonesia’s InfrastructureTalks Underway for Investment in Indonesia’s Infrastructure

Indonesia’s plan to carry out massive infrastructure projects across the country has attracted foreign investors, including the Iranian government, says a senior Indonesian official.

Indonesia’s Public Works and Public Housing Minister Basuki Hadimuljono on Friday had a meeting with Iranian Ambassador to Indonesia Valiollah Mohammadi Nasrabadi, as Tehran expressed its willingness to take part in housing, road and irrigation projects, wrote Indonesian newspaper The Jakarta Post.

 “Iran has had extensive experience in building houses for low-income citizens, particularly during the administration of [former president] Mahmoud Ahmadinejad. Therefore, they are offering us cooperation to support our housing program,” Basuki said on Friday.

Jakarta is planning to build 1 million houses annually to reduce its housing backlog, which reportedly stood at 13.5 million units as of 2014, by providing affordable houses for low-income people.

Of the 1 million homes to be built for low-income people this year, the government will be responsible for building 603,516 houses, while private developers will construct the remaining 396,484.

“Iran has a huge program with low-price housing. We will soon form a technical team that will be led by our secretary-general to discuss the detail of our future cooperation,” Basuki said.

In the initial stage, the ministry will construct 331,693 homes in the provinces of Aceh, North Sumatra, West Sumatra, Riau, Riau Islands, Lampung, South Sumatra, Jambi, Bengkulu, Bangka Belitung, Banten, Yogyakarta, Jakarta, West Java, Central Java and East Java.

On April 29, Indonesian President Joko Widodo officially launched the program with a ground-breaking ceremony for the construction of 103,135 homes in Semarang, Central Java.

According to Basuki, Iran also expressed its interest in joining a tender process for road projects in Sumatra, as well as cooperating in micro irrigation.

Jakarta is planning to soon open the tender for the second stage of the Trans-Sumatra Highway, which comprises four sections.

Basuki, however, said that both governments would further discuss which road projects in Sumatra had the potential for cooperation.

“Regarding the irrigation system, Indonesia already has cooperation with the International Commission on Irrigation and Drainage and Iran is the president of the organization. They are really ahead of us in irrigation,” he said of the NGO, which supports programs to enhance the sustainable development of irrigated agriculture.

Basuki said Jakarta has also offered assistance in building toll roads to the Iranian government since a number of state-owned construction companies had expertise in the sector.