This report provides a comprehensive analysis of Indonesia's Jakarta-Bandung High-Speed Railway (HSR), known as "Whoosh," based on data available up to October 2025. The findings indicate that the project, far from being a symbol of national progress, represents a catastrophic failure of governance, strategic planning, and fiscal prudence. The decision to proceed with China's proposal was driven by elite capture and a profound strategic incoherence, prioritizing short-term political symbolism over long-term economic viability. The project's implementation was a cascade of predictable failures, including massive cost overruns, chronic delays, and operational shortcomings that have rendered it commercially unviable. Its financing structure, initially promoted as a "business-to-business" deal with no state liability, has devolved into a form of economic entrapment, forcing the Indonesian government to socialize massive losses and seek debt restructuring, thereby compromising its fiscal and diplomatic autonomy. This analysis identifies the key political actors and elite networks that drove the decision, examines credible allegations of corruption and collusion, and contrasts the project's disastrous reality with the principles of a rational risk-mitigation framework. The Whoosh project serves as a stark cautionary tale of the perils of China's Belt and Road Initiative (BRI) when it intersects with weak domestic governance and a lack of public accountability.
The genesis of the Whoosh project is a case study in flawed decision-making, where a politically expedient narrative of a "fiscally painless" megaproject overshadowed rational economic and strategic analysis. The selection of China's bid over a more conservative Japanese proposal was not a strategic masterstroke but the project's "original sin," a choice driven by short-term political objectives and the influence of a powerful pro-China elite network that set the stage for the subsequent financial crisis.
In 2015, Indonesia found itself at the center of a geopolitical contest between its two largest Asian economic partners, Japan and China, both vying to build the nation's first high-speed railway.[1] Japan, leveraging its world-renowned Shinkansen technology, proposed a US$6.2 billion project backed by highly concessional financing, including a loan with a mere 0.1% interest rate.[5] A critical component of Japan's offer was the insistence on a sovereign guarantee from the Indonesian government—a standard international practice for projects of this magnitude, designed to ensure fiscal discipline and state accountability.[2]
In contrast, China presented a superficially more attractive offer. It proposed a lower initial cost of US$5.5 billion and, crucially, required no sovereign guarantee from the Indonesian government.[2] This allowed the deal to be framed as a purely "business-to-business" (B2B) transaction that would not directly burden the state budget, a key political objective for the administration of President Joko "Jokowi" Widodo.[6] China's bid also promised a faster completion date of 2019, greater absorption of local labor, and a commitment to technology transfer.[3] The "no sovereign guarantee" clause became the decisive factor, championed by then-Minister of State-Owned Enterprises (SOEs) Rini Soemarno as a more profitable and sovereign-friendly path for Indonesia.[6]
The very element touted as the deal's primary strength was, however, its greatest weakness. The B2B structure was a carefully constructed fiction, as the Indonesian "business" partners were a consortium of state-owned enterprises. Any financial failure would therefore inevitably fall back upon the state, but without the formal protections, transparency, and fiscal accountability that a sovereign guarantee would have mandated. This arrangement created an opaque vehicle ripe for elite capture, allowing political leaders to claim a landmark achievement without immediate budgetary impact, while the long-term risk was socialized onto the SOE system and, ultimately, the Indonesian public.
| Feature | China's Proposal | Japan's Proposal |
|---|---|---|
| Project Value (USD) | $5.5 - 6.1 billion [1] | $6.2 billion [6] |
| Government Guarantee | Not required (B2B model) [2] | Required [2] |
| Interest Rate | 2.0% [5] | 0.1% [5] |
| Loan Tenure | 40-50 years [14] | 40 years [15] |
| Technology Transfer | Promised [6] | Conditional/Less emphasized [10] |
| Projected Completion | 2019 [1] | Not specified |
The selection of the 142.3 km Jakarta-Bandung corridor represented a profound act of Strategic Incoherence—a complete mismatch between the stated goal of economic development and the chosen means.[17] The project was the antithesis of a rational "Minimisation Plan," a framework that would prioritize fiscal prudence, spending restraint, and a focus on core infrastructure needs, especially during challenging economic periods.[19]
The strategic rationale for the Jakarta-Bandung line was fundamentally flawed. The corridor was already served by adequate, if not optimal, transportation links, including a three-hour conventional train and a two-to-three-hour toll road.[22] The marginal time savings offered by the Whoosh—reducing the journey to approximately 40 minutes—could not justify the enormous capital outlay, particularly when factoring in the significant "last-mile" travel time required to reach the poorly located stations on the outskirts of both cities.[22] Analysts and public commentators have argued that a Jakarta-Surabaya HSR line would have represented a genuinely strategic investment, capable of fundamentally altering Indonesia's logistics network, reducing the cost of goods, and integrating the economies of western and eastern Java.[22] The Whoosh, in contrast, was a high-risk, high-cost prestige project that served political symbolism more than economic strategy.[22]
The decision to select China's bid was driven by a small, powerful circle within the Jokowi administration. President Widodo, reportedly impressed by China's HSR system during a state visit, provided the overarching political will for the project.[4] As Minister of SOEs, Rini Soemarno was a key architect of the deal, vigorously defending the B2B structure and its supposed benefits.[11] Luhut Binsar Pandjaitan, a close presidential confidant and powerful coordinating minister, would later emerge as the project's chief troubleshooter and most vocal defender, cementing his role as the primary enabler of Chinese-backed projects in Indonesia.[28]
This elite consensus, however, was not absolute. In a clear sign of the governance failures to come, then-Minister of Transportation Ignasius Jonan voiced strong and specific objections in early 2016.[8] He warned that the PT Kereta Cepat Indonesia China (KCIC) consortium had failed to meet numerous fundamental requirements, including securing necessary permits, resolving route conflicts with other transit projects, and proving it had deposited the minimum required capital.[8] These were not minor bureaucratic hurdles but red flags indicating a profound lack of due diligence and planning. Jonan's technically sound and fiscally responsible warnings were ultimately overruled, demonstrating that the decision-making process had been "captured" from the start by a political agenda that prioritized speed and symbolism over prudence and public interest.
The Whoosh project's implementation phase was a chronicle of mismanagement, where the initial strategic flaws metastasized into a series of predictable and costly failures. The timeline from the 2016 groundbreaking to the 2025 debt crisis reveals a pattern of inadequate planning, poor oversight, and a consistent underestimation of risks, transforming a symbol of progress into a national financial burden.
From its inception, the project was beset by problems that, while predictable in the Indonesian context, were evidently not adequately planned for. The most significant of these was land acquisition, a notorious bottleneck for Indonesian infrastructure development.[30] The process was marred by severe delays, conflicts over ownership, and community protests, leading to forced evictions and the destruction of farmland.[30] This failure to secure the necessary land in a timely and equitable manner became a primary driver of both project delays and the subsequent cost overruns.[14]
The construction phase itself was plagued by a series of alarming incidents that pointed to deficient safety standards and operational oversight. In October 2019, drilling activities triggered an explosion of a state-owned Pertamina pipeline, resulting in a fatality.[8] In March 2020, construction had to be temporarily halted after project work obstructed a drainage channel, causing major flooding on the critical Jakarta-Cikampek toll road.[8] Later that year, a support pillar collapsed, further highlighting the project's safety lapses.[8] These events not only delayed progress but also eroded public trust and underscored the haste with which the project was being pushed forward. The COVID-19 pandemic in 2020 introduced an external shock, causing a lengthy halt to construction and compounding the existing financial and logistical pressures.[1]
The combination of land acquisition delays, construction mishaps, and pandemic-related disruptions caused the project's budget to spiral out of control. The initial cost, estimated at between US$5.5 billion and US$6.07 billion, ultimately ballooned to over US$7.3 billion, representing a massive cost overrun of at least US$1.2 billion.[14]
This financial shortfall shattered the foundational promise that the project would not rely on state funds. In February 2023, the Indonesian and Chinese governments formally agreed on the final overrun figure.[35] To cover the gap, Indonesia was forced to secure a supplementary loan from the China Development Bank (CDB), which came at a higher interest rate of 3.4%, compared to the initial 2%.[5] More significantly, the Indonesian government had to directly intervene by providing a State Capital Injection (PMN) to the lead SOE, PT Kereta Api Indonesia (KAI), to cover the equity portion of the overrun.[8] This action constituted a de facto state bailout, proving the "business-to-business" model to be a hollow promise.
After years of delays, the Whoosh was officially inaugurated on October 2, 2023, and began commercial operations on October 17, 2023—four years behind its original 2019 target.[1] While KCIC has touted carrying over 12 million passengers in its first two years of operation, the financial reality is grim.[39] In August 2025, the CEO of KAI revealed that actual ridership was only 30% to 50% of the most pessimistic initial projections, exposing the project's fundamentally flawed business case.[40]
A key reason for this underperformance is the strategic failure of the station locations. The main terminals—Halim in Jakarta and Tegalluar and Padalarang outside Bandung—are disconnected from central business districts and existing public transport networks.[22] This poor integration forces passengers to undertake long and costly "last-mile" journeys by taxi or other means, negating much of the time saved by the high-speed journey itself and making the service impractical for daily commuters.[22] This design decision suggests the project may have been conceived more as a catalyst for speculative real estate development around new, remote hubs than as a functional public transport solution. As former West Java Governor Ridwan Kamil noted, the plan was to design "a new city with more buildings around the high-speed railway stations".[41]
Consequently, the project is hemorrhaging money. The Indonesian consortium, PT Pilar Sinergi BUMN Indonesia (PSBI), reported staggering losses of Rp 4.2 trillion (approx. US$258 million) in 2024, followed by another Rp 1.6 trillion (approx. US$98.3 million) in just the first half of 2025.[26] These losses are being absorbed by the parent SOEs, with the state railway operator KAI bearing the brunt of the financial damage.[26]
| Date/Period | Key Event/Milestone | Associated Pitfall/Failure | Cumulative Cost (USD) |
|---|---|---|---|
| Oct 2015 | China wins bid over Japan [1] | Acceptance of high-risk B2B model; no sovereign guarantee [2] | $6.07 Billion (Initial Budget) |
| Jan 2016 | Project groundbreaking [1] | Opposition from Transport Minister Ignasius Jonan ignored [8] | $6.07 Billion |
| 2017-2019 | Construction & Land Acquisition | Chronic delays in land acquisition; community protests [4] | Budget under pressure |
| Oct 2019 | Construction Incident | "Drilling triggers Pertamina pipeline explosion, causing one fatality [8]" | Costs increasing |
| Mar 2020 | Construction Incident | Project work causes major flooding on Jakarta-Cikampek toll road [8] | Costs increasing |
| 2020 | COVID-19 Pandemic | "Lengthy halt to construction, exacerbating delays [1]" | Costs increasing |
| Sep 2021 | Cost Overrun Acknowledged | Project costs estimated to have increased by US$1.9 billion [8] | ~$8 Billion (Revised Est.) |
| Feb 2023 | Final Overrun Cost Agreed | Indonesia and China agree on a final US$1.2 billion overrun [35] | $7.3 Billion (Final Cost) |
| Oct 2023 | Commercial Launch | Project begins operation 4 years behind schedule [4] | $7.3 Billion |
| 2024 | Financial Report | PSBI (Indonesian consortium) reports Rp 4.2 trillion loss for the year [26] | $7.3 Billion |
| H1 2025 | Financial Report | PSBI reports further Rp 1.6 trillion loss [26] | $7.3 Billion |
| Aug 2025 | KAI CEO Statement | "Project labeled a ""financial time bomb""; ridership far below targets [35]" | $7.3 Billion |
While the Whoosh project does not fit the simplistic narrative of a "debt-for-asset" swap, its financial architecture constitutes a more insidious form of economic entrapment. The punitive loan terms, the collapse of the "business-to-business" facade, and the ultimate socialization of debt have created a mechanism of policy capture and fiscal constraint. The Indonesian state, having accepted the initial deal under flawed pretenses, became a willing participant in its own ensnarement.
The project's financing was structured to maximize the lender's leverage, particularly in the predictable event of a cost overrun. The China Development Bank (CDB) financed 75% of the total project cost.[8] The initial loan carried a fixed interest rate of 2% per annum over a 40-year term with a 10-year grace period.[12] However, the critical US$1.2 billion cost overrun was financed through a supplementary loan at a significantly higher interest rate of 3.4%.[5] Given that cost overruns are almost a certainty in Indonesian megaprojects, this dual-rate structure functioned as a pre-planned penalty. It automatically increased Indonesia's financial distress and dependency, strengthening China's negotiating position for any future discussions, including debt restructuring or the proposed extension to Surabaya.
A crucial, often overlooked, element of the agreement is the collateral arrangement. The loan is secured by project revenues, which must be deposited into a debt service reserve account (DSRA).[38] The Industrial and Commercial Bank of China (ICBC) was appointed as the "security agent," granting it the legal authority to enforce claims against these revenues in the event of a default.[38] This clause is the true 'trap' in the agreement. It bypasses the need for a politically sensitive sovereign guarantee by giving the Chinese lender direct contractual control over the project's entire cash flow. In a default scenario, China would not need to physically seize the railway; it would simply control its revenue stream, giving it immense operational leverage without the political backlash of a formal takeover. This represents a sophisticated form of economic coercion embedded within the loan's legal framework.
The project was presented to the Indonesian public and parliament on the explicit premise that it was a B2B arrangement that posed no risk to the state budget.[6] This narrative proved to be a deliberate obfuscation. When the inevitable cost overruns materialized, the facade crumbled. The Indonesian government was forced to directly intervene, injecting state capital (PMN) into PT Kereta Api Indonesia (KAI) to enable the SOE consortium to cover its share of the overrun.[8] This act was a direct state bailout, fundamentally contradicting the project's foundational promise.
By 2025, the project's financial distress has become so acute that it can no longer be contained within the SOE ecosystem. The CEO of KAI has publicly labeled the project a "financial 'time bomb'".[35] In response, the Indonesian government, through its newly empowered sovereign wealth agency Danantara, has been forced to enter into formal debt renegotiations with China.[44] This move officially elevates the debt from a "business" problem to a sovereign-level crisis, confirming that the state is now the ultimate guarantor of the toxic loan.
The financial burden of the Whoosh project is now a direct constraint on Indonesia's fiscal capacity. The state is facing annual interest payments of approximately Rp 2 trillion (US$120.6 million) for this single, underperforming asset.[14] This debt service obligation is crippling the balance sheets of the state-owned enterprises involved, particularly KAI, which is forced to absorb hundreds of millions of dollars in losses.[26] This diverts capital and management attention away from KAI's core public service mission of operating the nation's conventional railway network, a clear case of capital misallocation with broad public consequences.[40]
While the Whoosh project does not involve an outright asset seizure, as was the case with Sri Lanka's Hambantota Port, it perfectly fits a more nuanced and modern definition of a debt trap.[47] The trap is not the loss of a physical asset but the erosion of sovereign autonomy. The immense debt burden and ongoing reliance on Chinese financing for the project's survival create powerful leverage for Beijing. This dynamic constrains Indonesia's policy options, forcing it to divert state resources to salvage a failed project and potentially limiting its diplomatic freedom of action on issues of strategic importance to China.
| Loan Component | Amount (USD) | Lender | Interest Rate | Maturity | Grace Period | Collateral |
|---|---|---|---|---|---|---|
| Initial Loan (USD) | $2.38 Billion [38] | CDB | 2.0% [14] | 40 Years [14] | 10 Years [14] | Project Revenues (via DSRA with ICBC as Security Agent) [38] |
| Initial Loan (RMB) | ~$1.59 Billion [38] | CDB | 3.46% [38] | 40 Years [38] | 10 Years [38] | Project Revenues (via DSRA with ICBC as Security Agent) [38] |
| Cost Overrun Loan | ~$560 Million - $1.03 Billion [38] | CDB | 3.4% [5] | 40 Years (negotiated) | TBD (negotiated) | Project Revenues (via DSRA with ICBC as Security Agent) [38] |
The Whoosh project's trajectory from a prestige initiative to a financial disaster was not accidental; it was driven by a network of powerful individuals and institutions that consistently prioritized political objectives and personal influence over public interest and fiscal prudence. These actors served as the primary "vectors of chaos," facilitating the project's acceptance on unfavorable terms and shielding it from accountability despite mounting evidence of failure.
Luhut Binsar Pandjaitan has been the project's most indispensable political patron, particularly since its early struggles became apparent.[28] In his various capacities as a senior coordinating minister and chief presidential advisor, he personally took charge of the project in late 2019 to resolve its many hindrances, leading negotiations with China and consistently defending it against criticism.[28] He continues to downplay the severe debt crisis, framing it as a simple matter requiring "restructuring".[5]
Luhut's role transcends that of a mere project manager; he functions as the primary political and geopolitical backstop for Chinese interests in Indonesia.[29] Described as the "prominent enabler behind China-Indonesia relations," he has personally spearheaded efforts to attract Chinese investment into dozens of BRI projects and has publicly positioned himself as the direct point of contact for Chinese investors facing problems in the country.[29] This deep alignment is underpinned by his own extensive business interests. Through his Toba Sejahtra group, Luhut controls a vast empire in the coal mining and natural resources sectors.[29] These businesses benefit immensely from close ties with China, which is a primary financier and market for Indonesia's resource extraction and downstream processing industries, such as the numerous Chinese-backed nickel smelters powered by captive coal plants.[52] This creates a powerful conflict of interest, incentivizing him to protect the overarching bilateral relationship with Beijing, even if it means endorsing projects like Whoosh that are detrimental to Indonesia's national finances. His public defense of Chinese labor importation and his tendency to downplay tensions in the South China Sea further illustrate this strategic alignment.[29]
Credible allegations of high-level corruption have been made public by Mahfud MD, the former Coordinating Minister for Political, Legal, and Security Affairs. He has repeatedly claimed that the Whoosh project's budget was subject to massive inflation or "mark-ups".[55]
His core allegation is based on a stark cost discrepancy: the Whoosh project's cost is calculated at US$52 million per kilometer, whereas comparable HSR projects constructed within China cost only US$17 to US$18 million per kilometer.[7] This nearly threefold difference, he argues, cannot be explained by standard variables and points to potential graft. Mahfud has publicly demanded an investigation to determine "where the money went and who was responsible for this markup".[56]
The response from Indonesia's Corruption Eradication Commission (KPK) has been telling. Instead of launching a proactive investigation based on a specific, quantitative allegation from a former senior cabinet member, the KPK has responded with bureaucratic passivity, urging Mahfud and the public to file a formal report with supporting data.[7] Mahfud has publicly derided this response as "odd" and a dereliction of duty.[59] The KPK's inaction is a powerful indicator of institutional decay and suggests that the project and its powerful patrons are politically untouchable, confirming that the mechanisms of elite capture have effectively neutralized the state's primary anti-corruption body.
While a comprehensive corruption investigation has yet to materialize, a formal probe by Indonesia's Business Competition Supervisory Commission (KPPU) has provided documented evidence of malfeasance within the project's supply chain. In December 2024, the KPPU found evidence of collusion in a tender for Electric Multiple Unit (EMU) transportation services, a sub-contract valued at Rp 70.3 billion (approx. US$4.3 million).[61]
The investigation found that the Chinese state-owned enterprise PT CRRC Sifang Indonesia, which was also acting as the tender committee, manipulated the procurement process to favor the winning bidder, PT Anugerah Logistik Prestasindo. The KPPU concluded that the winner did not meet the tender's qualification requirements, including minimum paid-up capital.[62] While this case is administrative rather than criminal, it serves as a microcosm of the project's governance failures, confirming a lack of transparency and fair competition in its procurement practices and lending credibility to the broader allegations of corruption.
The project's corporate structure was engineered to diffuse responsibility and obscure accountability. The operator, PT KCIC, is a joint venture between a Chinese SOE consortium (Beijing Yawan HSR Co. Ltd.) and an Indonesian SOE consortium, PT Pilar Sinergi BUMN Indonesia (PSBI).[11] PSBI itself is a holding company comprising four major Indonesian SOEs: PT Kereta Api Indonesia (KAI), PT Wijaya Karya (WIKA), PT Jasa Marga, and PT Perkebunan Nusantara VIII.[11]
This multi-layered structure of state-owned entities on both sides creates a convoluted web of accountability that is nearly impossible for the public, media, or even parliament to penetrate. It allows risk and financial losses to be shifted between entities, making it difficult to pinpoint responsibility for the project's failures. This is a classic structural enabler of elite capture, where complex corporate arrangements are used to shield decision-makers from scrutiny.[64]
| Entity | Ownership Stake | Key Constituent Companies | Role in Project |
|---|---|---|---|
| PT Kereta Cepat Indonesia China (KCIC) | 100% | N/A (Joint Venture) | Project Operator and Borrower [11] |
| ↳ PT Pilar Sinergi BUMN Indonesia (PSBI) | 60% of KCIC [11] | "KAI (51.37%), WIKA (39.12%), Jasa Marga (8.3%), PTPN VIII (1.21%) [11]" | Indonesian Consortium; Equity Holder; Absorbs losses [26] |
| ↳ Beijing Yawan HSR Co. Ltd. | 40% of KCIC [11] | "China Railway Group, Sinohydro, CRRC, China Railway Signal, China Railway Int'l [11]" | Chinese Consortium; Technology & Equipment Provider; Equity Holder [11] |
The Whoosh project's failures extend beyond Indonesia's balance sheets, creating significant geopolitical vulnerabilities and fueling a domestic political backlash. The project has exposed a deep strategic dissonance in Jakarta's policy towards China and has become a potent symbol of public discontent over elite mismanagement and foreign debt.
Indonesia's relationship with China is characterized by a dangerous strategic incoherence. On one hand, Jakarta pursues a deep economic embrace, viewing Beijing as an indispensable partner for its infrastructure-led development ambitions.[68] The Whoosh project stands as the flagship symbol of this partnership.
On the other hand, Indonesia maintains a firm, non-negotiable military and diplomatic posture regarding its sovereignty in the North Natuna Sea.[68] Jakarta does not recognize itself as a claimant in the South China Sea disputes and consistently rejects China's expansive "nine-dash line" (now "ten-dash line") as having no basis under the UN Convention on the Law of the Sea (UNCLOS).[68] This stance is not merely rhetorical. In late 2024, tensions flared as Indonesian naval and coast guard vessels were deployed to actively expel Chinese coast guard ships that were harassing Indonesian oil and gas exploration activities within its Exclusive Economic Zone (EEZ).[75]
This dual policy of economic dependency and military confrontation creates a fundamental vulnerability. The massive debt incurred from the Whoosh project provides Beijing with a powerful, recurring lever of influence over Jakarta. Every negotiation over debt restructuring presents an opportunity for China to pressure Indonesia to moderate its stance in the Natuna Sea or to concede on other strategic issues.[47] The financial entanglement from the railway directly undermines Indonesia's ability to act with full autonomy in the maritime security domain.
The public narrative surrounding the Whoosh has undergone a dramatic and negative transformation. Initial media coverage and government messaging framed the project as a moment of national pride and a leap into modernity.[22] By 2025, this celebratory tone has been entirely replaced by a discourse of failure and regret. The project is now widely described in Indonesian media and public commentary as a "financial time bomb," a "debt crisis," and a "cautionary tale" for the nation.[22]
Online sentiment analysis reveals deep-seated public cynicism and anger. In forums and on social media, the project is frequently derided as a vanity project for the political elite ("aurafarming") that serves no practical purpose for the majority of citizens.[23] A common and powerful critique is that the billions of dollars spent on the short Jakarta-Bandung line would have been far better invested in developing essential railway networks on other islands like Sumatra or Sulawesi, which would have had a much broader developmental impact.[23] The high ticket prices and the impracticality of the remote station locations are also constant sources of public frustration.[23]
Most significantly, the term "utang China" (China debt) has become inextricably linked with the project in the public consciousness.[46] This framing has transformed the Whoosh from a domestic infrastructure project into a symbol of a national burden imposed by a foreign power, fueling nationalist and anti-China sentiment. This public anger represents a significant long-term political risk for both Beijing and the Indonesian elites who championed the project, as it creates a potent narrative for opposition movements and is likely to foster deep public skepticism towards future large-scale, Chinese-funded initiatives.
The Whoosh fiasco is not an isolated incident but part of a wider pattern of problematic BRI projects across the developing world. These cases provide a comparative context and a potential roadmap for Indonesia's future.
These international parallels demonstrate that even without an outright seizure of assets, the combination of unsustainable debt, elite complicity, and opaque deals consistently leads to a long-term erosion of economic sovereignty and policy independence for the host nation. Indonesia is now firmly on this well-trodden and perilous path.
The Jakarta-Bandung High-Speed Railway project, conceived in political hubris and executed with gross negligence, stands as a monumental failure of public policy. It is the inevitable outcome of a process dominated by a captured elite network, financed through an opaque and coercive debt structure, and justified by a strategically incoherent vision. The project failed every test of a prudent "Minimisation Plan" and serves as a textbook case study of the severe risks inherent in China's Belt and Road Initiative, particularly when it intersects with weak domestic governance and a pervasive lack of transparency.
Indonesia is now in the unenviable position of a debtor seeking relief. However, it is not without leverage. China has a significant reputational stake in the success of its first-ever overseas HSR project, and Indonesia's strategic position as the de facto leader of ASEAN makes it a partner Beijing cannot afford to completely alienate. In its negotiations with the China Development Bank, Jakarta must adopt a firm and unified strategy with the following objectives:
To prevent a recurrence of the Whoosh disaster, Indonesia must undertake fundamental reforms to its infrastructure planning and procurement processes. The principles of a "Minimisation Plan" should be institutionalized as a national framework for all future megaprojects. Key reforms should include: