The Government of Indonesia has announced plans to extend its Chinese-backed high-speed railway (HSR) from Jakarta to Surabaya, the country’s second-largest city. The proposed project would build on the existing USD7.3 billion Jakarta–Bandung “Whoosh” line, which was plagued by delays, cost overruns, and a projected 40-year break-even timeline. The extension is backed by Indonesia’s National Economic Council, which recently reaffirmed the plan during a visit to Beijing. However, no formal regulation has been issued, and a joint feasibility study with China is pending.
The original Whoosh project was largely financed by a 40-year loan from the China Development Bank, with Indonesia covering the rest through state funds, despite initial promises to avoid public financing. The line posted a USD193 million deficit in its first year. Citing past experience, officials now stress that any Surabaya extension must avoid burdening the state budget. Alternatives being explored include slower rail systems and public-private partnerships.
The extension, which would connect two of Indonesia’s main commercial hubs, is expected to boost passenger volumes and improve long-term returns. However, analysts warn that further borrowing from China could heighten concerns over debt sustainability and dependency. Experts recommend diversifying funding sources and ensuring greater transparency in project governance to safeguard national interests.
