Jakarta. The Jakarta administration plans to increase its inaugural municipal bond issuance to around Rp 5.2 trillion ($290.22 million) from the previously proposed Rp 3.5 trillion, with the additional funding earmarked for the capital's LRT expansion and the construction of an international-standard hospital.

Jakarta Governor Pramono Anung said the issuance size was raised by about Rp 1.7 trillion after the city reassessed the financing needs of several priority projects.

"The World Bank is serving as an advisor to Indonesia and, of course, to Jakarta as we prepare to issue a municipal bond for the first time. The issuance will be around Rp 5.2 trillion. The funds will mainly be used for two purposes: completing the LRT extension from Manggarai to Dukuh Atas and financing projects related to healthcare and social services," Pramono said at Jakarta City Hall on Wednesday.

The LRT extension from Manggarai to Dukuh Atas is one of the city's top priorities, as the project is expected to strengthen Jakarta's public transportation network and help ease traffic congestion.

Part of the proceeds will also finance the construction of an international-standard hospital to improve healthcare services in the capital.

"The Jakarta administration will build an international-standard hospital, so the funding requirement is indeed there. We are confident that the Jakarta administration will be able to deliver the project successfully," Pramono said.

The planned issuance marks Jakarta's first use of a municipal bond as a long-term financing instrument for strategic infrastructure projects.

The World Bank is assisting the provincial government in designing the bond issuance framework to ensure it meets regulatory requirements and follows sound governance principles.

Pramono expressed confidence that the Rp 5.2 trillion bond issuance would strengthen Jakarta's financing capacity without compromising fiscal sustainability. Subject to approval from the central government, the proceeds will be used to accelerate the LRT connection between Manggarai and Dukuh Atas while expanding the city's healthcare infrastructure.

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