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RI to explore counter trade with China for Sumatra railways

Indonesia plans to explore the possibility of using counter trade with China to fund railway development in Sumatra island

JAKARTA (JP): Indonesia plans to explore the possibility of using counter trade with China to fund railway development in Sumatra island, agencies reported on Sunday.

"Because the government has no funds for the project, it will study the possibility of concluding counter-trade transactions with China," Transportation Minister Agum Gumelar was quoted by Antara as saying.

Speaking after opening a seminar on the development of an integrated Sumatra-Java railway system here, Agum said a team from the ministry will go to China in April.

He said Sumatra has a lot of commodities to offer in counter trade deals with China such as coal, oil and gas and palm oil.

Sumatra now has limited railway networks in the northern and southern parts of the island.

He signed a memorandum of understanding to speed up the project, with eight Sumatra governors and the governor of Banten, the westernmost province on Java island.

The transportation ministry has said the 5,084-kilometer (3,152.08-mile) long railway project would need US$16.06 billion in investment.