Japan is reportedly pursuing a deal to invest $2.49bn into the new deep-sea port project in Patimban, Subang, West Java, through the Transportation Ministry of Indonesia.
The project, which requires a total investment of $3.09bn has been offered for investment by the Japanese Government by an official letter directed to the Transportation Ministry responding to the Indonesian Government’s offer to take on the largest share.
The loan will span across a period of 40 years, and will include a grace period of ten years.
The rest of the fund, which amounts to around $600m, is reported will be acquired from the state budget for land procurement and road construction around the port.
The Patimban Port, located at 120km east of Jakarta, has replaced the Cilamaya port in Karawang, West Java, which was dropped because it was thought to affect the expansion of staterun oil and gas firm Pertamina‘s nearby offshore operations, reported by Jakarta Post.
The first phase of the port project is scheduled to start in 2019 and after completion, the port is expected to be equipped with an initial container capacity of 250,000 twenty-foot equivalent units (teus) and will be expanded to 7.5 million teus by 2037.
The start of the construction is still subject to a range of requirements, including completing detailed engineering design (DED), securing an Environment Impact Analysis (Amdal), as well as adjusting the location to the provincial spatial planning (RTRW) of the Subang area.
Japanese manufacturing firms, such as Toyota and Honda are likely to be benefitted by the new development, owing to the fact that their facilities are located in the Bekasi and Karawang manufacturing centres, which are situated at the vicinity of the planned port.
It is reported that earlier this year, Belgium firm Dredging, Environmental & Marine Engineering (DEME) had showed interest in potentially working on the development of a new deepsea port project in Patimban.