Jakarta. State-Owned Enterprises Minister Erick Thohir on Tuesday said the government is considering renegotiating the debt of the Jakarta–Bandung high-speed rail project, better known as Whoosh, which has become a financial burden for state railway operator Kereta Api Indonesia (KAI).

“Whoosh will have a (debt) renegotiation,” Erick told reporters at the Parliament complex. He added that under the government’s plan, KAI would continue to manage rolling stock, while the state takes responsibility for infrastructure such as tracks and stations.

The government recently injected Rp 1.8 trillion ($109.8 million) in state capital into KAI, but Minister Erick clarified that the funds are unrelated to Whoosh’s debt refinancing. The capital will be used to expand commuter rail services in the Greater Jakarta area.

The Whoosh line has transformed travel between Jakarta and Bandung. The 142-kilometer journey now takes just 45 minutes, compared with up to three hours by car. Between January and June this year, the service carried 2.9 million passengers, up 10 percent from a year earlier. The train was even praised during President Prabowo Subianto’s bilateral talks with Chinese President Xi Jinping in Beijing last November. Yet despite its popularity, the project has become a debt headache.

The Rp 119.6 trillion ($7.3 billion) project was financed 75 percent through loans from the China Development Bank. The initial borrowing carried a 2 percent annual interest rate, but pandemic disruptions and land acquisition disputes led to a $1.2 billion cost overrun, forcing Indonesia to secure additional financing at a higher 3.4 percent rate.

KAI’s president director, Bobby Rasyidin, recently described the high-speed rail as a potential “time bomb” because of the financial strain it has imposed on his company. KAI, through a state-owned consortium, holds a majority stake in KCIC and therefore bears the brunt of its losses. In the first half of 2025, KAI booked Rp1.24 trillion ($75 million) in losses linked to the line, an improvement from Rp1.81 trillion in the same period last year, but still a heavy burden.

Erick stressed that the debt issue must be resolved before the government proceeds with the planned Jakarta–Surabaya high-speed rail project. 

The government has allocated a total of Rp 4.77 trillion ($290.9 million) in state capital injection this year for three state-owned enterprises: KAI, Pelayaran Indonesia (Pelni), and train manufacturer Industri Kereta Api (Inka). Erick said the funds are aimed at improving public transport facilities.

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