China Development Bank (CDB) has signed a US$4.5 billion loan to a consortium of state-owned companies from Indonesia and China for the Jakarta-Bandung railway.

The loan agreement was signed while Indonesian President Joko Widodo was in Beijing for the Belt and Road Initiative Forum, during which he held bilateral talks with China's President Xi Jinping.

The 142km rail link will connect the Indonesian capital to the capital of West Java in 45 minutes. Construction is supposed to be finished by 2019.

The CDB loan will cover 75% of the project's estimated cost, with the consortium providing the other 25% in equity. The project construction agreement was signed last year, but progress has thus far been slow, with land disputes along the route of the railway. The total estimated project cost also rose from an initial estimate of US$5.1 billion to the current US$6 billion price tag. The CDB loan is denominated 60% in US dollars and 40% in renminbi.

A 50-year design-build-operate-maintain concession was signed in March 2016 with Kerata Cepat Indonesia China. China Railway International holds a 40% share in the consortium. Domestic participants include Wijaya Karya, toll road operator Jasa Marga, and national train operator PT KAI.

Photo courtesy of Wikipedia.