State-owned lender Bank Negara Indonesia (BNI) has signed an agreement with 15 other banks to finance the construction of a 39.29-kilometer toll road from Pemalang to Batang—two cities in Central Jakarta.
The syndicated loan agreement of the 16 banks was signed on Wednesday.
The agreement indicates a growing interest of banks in financing infrastructure projects being promoted by the government, said BNI deputy president director Herry Sidharta as reported by tribunnews.com.
Among those attending the signing ceremony was Herry Sidharta; Bambang Riyanto, the operational director of state-owned construction firm PT Waskita Karya; PT Pemalang Batang Tol Road (PBTR) president director Supriyono; and representatives of 15 other banks. PT Waskita Karya is the developer of the project.
The government had invited private companies to take part in financing the infrastructure development project due to its limited financial resources.
In addition to BNI, the banks taking part in the deal were Bank Panin, Bank Artha Graha, Bank Jateng, Bank Sumut, Bank Nagari, Bank ICBC, Bank Pembangunan Daerah (BPD) Bali, Bank Sulselbar, Bank DIY, Bank Jambi, Bank Kalteng, Bank Maluku Malut, BNI Syariah, Bank Aceh Syariah, Bank DIY Syariah and Bank BJB Syariah.
The project costs Rp 4.88 trillion (US$366.94 million). BNI is expected to contribute Rp 1.5 trillion to the project.
The Pematang-Batang toll road is a section of the Trans-Java Toll Road that will connect Jakarta and the East Java capital of Surabaya.
The groundbreaking ceremony of the section was led by President Joko “Jokowi” Widodo on June 17, 2016. The section is expected to be completed next year.