Private sector sought for Trans Sarbagita investment

By Agnes Winarti 

Published in Bali Daily/The Jakarta Post Wednesday, May 15 2013

Since its launch in 2011, Bali’s first integrated public transportation system, Trans Sarbagita, has yet to attract private investors, a necessary factor to expand the network across the whole Sarbagita area, an acronym that stands for Denpasar city, Badung, Gianyar and Tabanan regencies.

Until now, the two main Trans Sarbagita bus corridors, connecting Batubulan–Nusa Dua and Denpasar–Jimbaran, rely on the operation of 25 buses, all of which were donated by the Transportation Ministry.

While the ministry expects this grant of buses to stimulate each of the respective areas and the province to be proactive in its own expansion, Bali still faces investment hurdles to develop the bus rapid transit system, which is expected to have 17 corridors by 2019.

“It is hard to find private investors willing to invest not just in Badung but also in Bali because it’s difficult for them to measure the breakeven point investing in transportation. If there are any, most of them are large companies already established in Java,” Badung transportation agency’s head of public transport division Made Widiana told Bali Daily.

Aiming to establish a more integrated network through Trans Sarbagita, Badung administration cooperates with a Cikarang, West Java-based minibus operator to run 14 feeder minibuses along two routes, while Denpasar administration also works with local enterprises that operate 48 modified, old minibuses on four routes. Badung allocated Rp 3.7 billion (US$378,000), while Denpasar earmarked Rp 5 billion, annually for the operational costs of these routes.

The provincial administration has similarly purchased third-party transportation services from state-owned public transportation company DAMRI and local firm Restu Mulya for the main Trans Sarbagita corridors. This year, the province has allocated around Rp 9 billion for the operation and maintenance of its two existing corridors.

“The private sector may have been willing to invest as a service operator, but so far no one has been interested in placing multifold investments for bus procurement,” said Bali Transportation Agency head Dewa Putu Punia Asa, who recently publicly urged more investors to join the administration in developing Trans Sarbagita.

Despite the steadily increasing average number of daily passengers, from 1,508 people per day in 2011 to 2,886 in 2012, Punia still argued that the public’s decades-old dependency on motorcycles and private vehicles made it difficult for the public and investors alike to fully embrace public transportation now.

Director of Urban Transport System Development at the Land Transportation Directorate General in the Transportation Ministry, Djoko Saksono, emphasized an equally crucial factor for the successful implementation of public transportation: a proactive effort from the local administrations to convince the private sector to jointly develop the transport system.

“The local administrations in Bali have to invest not just capital but also policies that are in favor of public transportation, while providing protection and comfort for the users. To successfully implement public transportation, supporting facilities must go hand-in-hand. That includes making available adequate sidewalks and banning on-street parking that clearly disrupts the Trans Sarbagita buses when operating along the routes,” Djoko told Bali Daily on Tuesday.

Previously, the president of Indonesia Transportation Society, Danang Parikesit, had also urged the central government to increase the fiscal capacity of local administrations by allocating some of the savings made from the fuel subsidy reduction to support the self-financing of provincial and regional urban transportation development.

“The government must set a clear plan so when it decides to reduce the fossil fuel subsidy, it will simultaneously boost investment in the transportation sector. The government needs to increase the fiscal capacity of local administrations so they can use more of their regional budget to self-finance in developing their urban transport sector,” said Danang.

“It’s impossible for the ministry to continuously subsidize buses for the 400 cities and regencies nationwide to develop their transport sector,” he declared.