RI, Japan agree on yen loan amounting to US$16.151 million

Jakarta (ANTARA News) - Indonesia and Japan reached agreement on a 1.869 billion yen or around US$16.141 million to Indonesia for funding a survey and program planning of the Jakarta Mass Rapid Transport(MRT) system.

Information on the agreement from the Indonesian embassy in Japan, said the exchange of documents of the agreement took place between Indonesian Foreign Minister Hassan Wirajuda and his Japanese counterpart Taro Aso in Tokyo on Tuesday.

A Mass Rapid Transport system is badly needed in metropolitan Jakarta to overcome traffic jams which had been posing a serious problem especially during morning and afternoon rush hours as the result of inadequate road infrastructure and excessive dependence on road transporation.

The information also said that the Jakarta MRT project was designed to improve the capacity of passenger movements in Metropolitan Jakarta by the construction of a 14.5 km railway track, partly underground, between Lebak Bulus and Dukuh Atas, at a cost estimated at 110 billion yen.

The yen loan was actually a special term for economic partnership with an interest rate of 0.40 percent per year, and payable in 40 years including a grace period of 10 years, and the procurement of goods and services.

The Japanese government hoped that the loan would give a greater contribution to the improvement of the functions of Jakarta city and the restoration of a conducive investment climate in the capital city, in addition to stabilizing international environment in Japan and strenghthening the relations between the two countries through building a stable Indonesia.

The agreement brought Indonesia`s debts in the yen to 4,42 trillion.

Earlier, Transportation Minister Hatta Rajasa said in the Indonesia Infrastructure Summit that the the central government through the state budget provided around 15 percent, or US$120 million, in counterpart fund for the MRT project.

The construction of the MRT project will be shared by Japan and Indonesia each with 30 percent, and the remaining 40 percent will be decided through an international tender.