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28 Aug, 2018

Indonesian government pursues 50% local component for infrastructure projects

Jakarta (ANTARA News) 24th August 2018 – Minister of Transportation (Menhub) Budi Karya Sumadi said that the Indonesian government encourages the use of 50 percent of local components for infrastructure development, especially railways.

“We will intensify our train manufacturing industry, so that `local content` would increase. When we built the first `local content,` it was 30 percent; now it is 40 percent; and in the near future, with our State-Owned Enterprises Minister, we will increase it to above 50 percent,” Sumadi stated here on Thursday.

He noted that according to President Joko Widodo`s mandate, domestic projects must use more local components.

By using more local components, many positive impacts would be obtained, including saving a lot of foreign exchange, absorbing many local personnel, and allowing export, he further stressed.

According to him, the railway project in Palembang has reached 40 percent of local components.

Regarding the Jakarta-Surabaya semi-fast train project, Sumadi remarked that he had sought reasonable prices and participation of domestic contractors.

“I ask the Agency for the Assessment and Application of Technology to guard, so that `local content` would increasingly be used,” he pointed out.