The Government of Indonesia has confirmed it will use public funds to repay debt owed to China for the Jakarta–Bandung high-speed railway (HSR) project, following weaker-than-expected financial performance. The move comes after earlier assurances that the China-backed proposal would not impose a fiscal burden on the state.
The 142 km HSR, connecting Jakarta and Bandung, was developed under a joint venture between Indonesian state-owned enterprises and Chinese partners. Ridership had been projected at more than 18 million passengers annually, but actual patronage reached approximately 6.2 million passengers in 2025. Cost overruns and lower revenue generation have affected the project’s financial sustainability, prompting debt restructuring discussions with Chinese lenders.
The railway forms part of Indonesia’s broader infrastructure modernisation drive and was promoted as Southeast Asia’s first high-speed rail line. However, financing pressures have intensified scrutiny of demand forecasts and project structuring. The government’s decision to allocate public funds underscores the fiscal implications of large-scale infrastructure projects financed through external borrowing.