World Bank Document

40 O4 9- x Document of The World Bank

FOR OFFICIAL USE ONLY Public Disclosure Authorized

Report No. 3376-IND

STAFF APPRAISAL REPORT Public Disclosure Authorized

INDONESIA

JAKARTA-CIKAMPEK HIGHWAY PROJECT

Public Disclosure Authorized August 19, 1981 Public Disclosure Authorized Transportation Division Regional Projects Department East Asia and Pacific Regional Office

This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS

Currency Unit - Rupiah (Rp) US$1 Rp 625 Rp 100 = US$0.16 Rp 1 million = US$1,600

WEIGHTS AND MEASURES Metric 1 millimeter (mm) = 0.04 inch

1 centimeter (cm) - 0.39 inch 1 meter (m) = 13.28 feet 1 cubic meter (cu m) = 35.28 cubic feet 1 kilometer (km) = 0.62 miles 1 square kilometer (sq km) = 0.39 square miles 1 hectare (ha) - 2.47 acres 1 liter (1) 0Oc22 British gallons 0.26 US gallons

1 kilogram (kg) - 2.20 pounds

1 metric ton (m ton) - 2.204 pounds

ABBREVIATIONS AND ACRONYMS

ADT - Average Daily Traffic BAPPENAS - National Planning Council CIPTA KARYA - Directorate General of Housing and Urban/Regional Development (Ministry of Public Works) DGH - Directorate General of Highways DKI - Special Provincial Government of Jakarta DPUK - Kabupaten (District) Public Works Office DPUP - Provincial Public Works Office ERR - Economic Rate of Return GDP - Gross Domestic Product GOt - Government os Indonesia GNP - Gross National Product INDOC - Project Preparation Consultants JABOTABEK - Greater Jakarta Metropolitan Region JASA MARGA - P.T. (Persero) Jasa Marga (toll road corporation) KFAED - Kuwait Fund for Arab Economic Development MHA - Ministry of Home Affairs MOC - Ministry of Transport, Communications and Tourism MOF - Ministry of Finance MPW - Ministry of Public Works NPV - Net Present Value OECF - Overseas Economic Cooperation Fund (Japan) PCU - Passenger Car Unit PJKA - Indonesian State Railway PPAR - Project Performance Audit Report REPELITA - National Development Plan

FISCAL YEAR

April 1 - March 31 FOR OFFICIAL USE ONLY

INDONESIA

JAKARTA-CIKAMPEK HIGHWAY PROJECT

STAFF APPRAISAL REPORT

Table of Contents

Page No.

I. THE TRANSPORT SECTOR

A. Sector Development Trends ...... 1 B. Transport Development Plans and Financing . . . 2 C. Transport Sector Issues ...... 4 D. Functional Organizations for Transport ...... 7 E. Development and Administration of Toll Roads ...... 9 F. Experience Under Previous Bank Group Financed Highway Projects ...... 10

II. THE GREATER JAKARTA METROPOLITAN REGION...... 12

A. Regional Development Trends ...... 12 B. Metropolitan Finance ...... 14 C. Regional Planning ...... 15 I9. Regional Transport ...... 15 E. Regional Development Strategy ...... 16

III. THE PROJECT

A. Project Objectives ...... 18 B. Project Scope...... 18 C. Detailed Project Description ...... 18 D. Project Costs ...... 22 E. Project Financing ...... 24 F. Implementation, Procurement, and Environmental Aspects . 25 G. Disbursement ...... 29

IV. PROJECT JUSTIFICATION

A. General ...... 29 A. Geea...... 29- .

This report is based on the findings of two Bank missions which visited Indonesia in April-May and October-November 1980, comprising Messrs. P. Jensen (engineer), T. Neuner (economist)(Bank), M. Powills and J. Revis (consultants) on the first mission, and Messrs. P. Jensen (engineer), P. Levy (financial analyst), and H. Peters (economist) on the second mission.

This document has a restricted distribution and may be used by recipients only in the performance of their official duties, Its contenst may not otherwise be disclosed without World Bank authorization. Page No.

B. The Jakarta-Cikampek Corridor ...... 30 C. Traffic Projections ...... 32 D. Project Benefits ...... 33 E. Economic Analysis ...... 34 F. Financial Aspects ...... 36 G. Project Risks ...... 36

V. AGREEMENTS AND RECOMMENDATIONS ...... 37

TABLES

1. Road Transport Resources by Region 2. National Government Budgets by Output Category, 1978/79 and 1979/80 3. Gross Domestic Project by Industrial Origin 4. Comparison of Regional Allocations under Repelita III and Proposed Development Budgets in the Greater Jakarta Metropolitan Region 5. Government Agencies Involved in Transport in Jakarta and Surrounding Kabupatens 6. Estimated Regional Road Freight Flows 7. DGH Geometric Highway Design Standards 8. Project Costs 9. Project Implementation Schedule 10. Disbursement Schedule 11. Jakarta-Cikampek Highway: Traffic Volume Counts and Observed Traffic Composition 12a.} 12b.} Traffic Forecasts 12c. } 13. Vehicle Operating Costs 14a.} 14b.} Estimated Cost and Benefit Streams 14c.}

ANNEX

1. Related Documents and Data Av7ailable in the Project File

CHARTS

1. Organization of the Ceritral and Provincial Highway Administration 2. P.T. Jasa Marga Organization Chart 3. Observed Traffic Composition on the Jakarta-CLkampek Highway

MAP

IBRD 15036 - Jakarta-Cikampek Highway. Prcjcet Location and Highway Details I. THE TRANSPORT SECTOR

A. Sector Development Trends

1.01 Indonesia, the world's largest archipelago nation, ranks fifth in population with over 145 million people. The archipelago extends some 5,000 km across the equator from northwestern Sumatra to Irian Jaya and comprises over 13,000 islands of which Java, Sumatra, Kalimantan and Sulawesi are the largest. Indonesia has a total land area of 2 million sq km. The extent of the country .zd its archipelagic nature imply diverse climatic conditions, factor endowments and resource potentials. Economic integration of the different regions and the pursuit of political and national uniity among such diversity are important objectives of the Government of Indonesia (GOI). Transportation has a leading role in this effort. Over the past decade Indonesia has made great strides in developing its economy. Between 1971 and 1978 the gross domestic product (GDP) rose from Rp 5,600 billion to Rp 9,250 billion, in real terms, an average annual growth rate of 7.4%. The transport sector is estimated to have grown about 12% per annum during the 1970s and its contribution to GDP varied between 4% and 5%. GOI planners predict the sector's share to increase to around 6% of GDP by the end of the century which means a continuation of the annual growth trend of around 10%.

1.02 Within the Indonesian transport system road transport is the principal mode. In terms of volumes, about 93% of all goods and about 99% of all passengers transported in Indonesia in the mid-seven.ies were accommodated by road. Road infrastructure expanded from 85,000 km to 115,000 km between 1971 and 1977 while the annual growth of the road vehicle population was about 15% for commercial vehicles and 22.5% for cars. Maritime transport, including interisland ferries, is the second mode. Its importance derives from the archipelago setting of the country. About 95% of all freight movements and roughly 75% of all person-trips between the islands are handled by sea transport. In 1977 there were about 7,800 vessels with a total deadweight tonnage of 2.5 million available for interisland transport. Domestic marine dry cargo traffic increased by roughly 15% annually during the past decade. Approximately 300 ports and numerous landing points constitute the basic infrastrujcture for maritime transport. The railway system, the third mode in terms of importarnce, inicludes about 6,800 route-km. During the 1970s the share of the railways in passenger and freight traffic has declined substantially by <.s much as 45% and 20%, respectively. In 1978, the railway system carried about 29 million passengers and 4.4 million tons of freight. Lately, there has been a slight recovery from the earlier losses in patronage. Domestic air transport increased rapidly during the 1970s; the average annual growth rate for passenger traffic was 22% and the volume of cargo carried in 1978 was seven times higher than in 1970. In 1978, Indonesian air carriers disposed of a fleet of about 550 aircraft which carried about 4 million passengers during that year. River transport has a potentially important role in addressing demand for movement of people -2-

and goods in Indonesia. There are at least 10,000 km of navigable waterways among about 50 river systems. By 1977, over 41,000 river craft of varying size and capacity were registered.

B. Transport Development Plans and Financing

1.03 In 1969, GOI initiated its first five-year national development plan, Repelita I, covering the period through 1973. About 15% of the Repelita I resources was allocated to the transport sector, representing Rp 342 billion. Only Rp 297 billion were actually spent in the sector, and rouahly 55% of this amount was invested in road development. Repelita II, spanning the period between 1974 and 1978, initially provided Rp 500 billion to the transport sector, which constituted 16% of the total development effort; Rp 753 billion were actually spent. This sizeable increase of expenditures was due to the extra revenue accruing to GOI after the 1973 oil price increase, which particularly benefitted the transport sector. Road development accounted for about 42% of all expenditures in the transport sector during Repelita II. GOI's explicit policy for the sector during the period 1969-78 emphasized rehabilitation and improvement of existing transport infrastructure and services rather than an extension of the network and expansion of the transport industry. Repelita III, covering the period between 1979 and 1983, provides for Rp 2,998 billion to be invested in transport development; this represents about 14% of the total plan effort. Proposed expenditures for road infrastructure constitute more than half of the allocation to the transport sector under Repelita III. The increased share for roads over the corresponding allocation under Repelita II is partly attributable to GOI's new emphasis on rural roads as an explicit component of the broader rural development strategy. The higher share of investments in roads is compensated primarily by a decline in the relative allocation for maritime transport. Compared with the provisions under Repelita II, the allocation for air transport has also risen, while funds available to the railways have been reduced. These changes conform to the growth experienced by the various modes in recent years - fast for aviation and road transport, modest for shipping, and stagnant for railways. It also reflects the need to improve modal performance in the light of projected transport growth during Repelita III, viz. 20% in air transport, 12% in road transport, 10% in sea transport, and 5% to 12% for various categories of rail transport. There are additional transport sector provisions in Repelita III which are not specified under the sector heading. For instance, nearly Rp 600 billion of the Rp 2,100 billion to be allocated by the Ministry of Home Affairs (MHA) to lower levels of government will be spent on roads.

1.04 Despite increasing budget allocations to, and private investments in, transport, the system's ability to effectively address existing and evolving transport demand within the national economy remains far from -3-

adequate. The country's enormous dimensions and the still uneven distribution of income within the national population make it extremely difficult and expensive for GOI to pursue a transport strategy aimed at providing both equal transport facilities to all segments of the population and transport investments required by the accelerating economic development. This diffi- culty is compounded by the high percentage of existing transport: infrastructure which is still badly deteriorated and needs considerable rehabilitation and often upgrading to effectively fulfill its function. Also, serious shortcomings exist in the management and operation of existing transport infrastructure and services. As a result, the capacity potential of most transport resources is underutilized. The wide variations in the availability of transport infrastructure and services in the different regions of the country aggravate the problems. Most regions where presently economic activities and highest population densities are concentrated enjoy better availability of transport infrastructure and services over other regions. In particular, both Java and Sumatra dispose of an existing transport system which is far more extensive than that of the other islands.

1.05 Due to historical trends, factor endowments and regional advantages, Java and Sumatra generate the highest contributions to GDP; they also have the highest population concentrations in the country. Table 1 provides an over- view of the road transport infrastructure in the different parts of Indonesia. Java and Sumatra rank highest in terms of road length and transport fleet. Statistics for air and maritime transport compare similarly. In addition, both islands have a network of railvways. GOI's difficult task is to ensure that the transport requirements of the Java and Sumatra regional economies are effectively met but at the same time a major effort is urgently required to develop transport infrastructure a-nd services in other regions of the country in order to spur local economic and social development. During the past decade high proportions of the capital and current budgets have benefitted the Java and Sumatra economies. Also, foreign and domestic private investments were primarily made in Java and Sumatra. In the transport sector, an estimated 65% of the national development budgets were spent in these two regional economies. GOI is concerned about regional equity in the transport sector, and local governments throughout the country are pressing to receive a fair share of the annual budgets allocated to transport. On the other hand, Sumatra and even more so Java are considerably burdened with the need to integrate their sizeable populations into economic and social development. The average per capita income of Java's population is still 10% below the national average. To serve the overall transport needs of the regional population requires continued public sector intervention.

1.06 Over the years GOI has introduced several measures aimed at over- coming inefficiencies in the transport system. Among other things, GOI provided subsidies in several instances where cost-based pricing for transport services were thought to prevent many segments of the national population and several remote regions from participating in economic and social development. In particular, pioneer services were instituted, providing for subsidized sea, air and land traClsport to underdeveloped regions of the country. But capital and current budget allocations to the transport sector in order to - 4 -

ensure adequate transport supply would be overwhelming. To fully comply, GOI would have to divert funds allocated to other productive sectors, thereby constraining the development of other elements of the national economy. As an indication of the importance GOI attaches to the different elements of the national economy and their respective development, the capital expenditure budgets for fiscal years 1978/79 and 1979/80 are shown in Table 2.

C. Transport Sector Issues

1.07 GOI has sought and analyzed ways and means to improve the transport system's countrywide performance to more effectively and equitably meet existing and evolving transport demand, subject to budget constraints. Several areas have been identified as critical impediments to overall transport sector performance. Essentially, they fall into four categories:

(a) inefficient utilization of existing transport facilities;

(b) uncoordinated and fragmented arrangements for transport development planning and transport system management;

(d) limited recovery of the costs of developing, operating and maintaining transport infrastructure and services.

1.08 The Bank's transport sector survey carried out in 1980 has helped identify transport sector issues and assess their consequences. In December 1980, extensive discussions took place between GOI and the Bank to review the economic and social impact of transport sector shortcomings and scrutinize possible ways of dealing with the problems. GOI is now planning to prepare an action program aimed at improving the performance of the transport system and at controlling budget requirements Eor its management and development. Sub- stantial assistance will be required during this process, and the proposed project will provide for initiating measures and arrangements to improve transport systems performance in the Greater Jakarta Metropolitan Region.

1.09 The key features of a desirable action program would be:

(a) improved management and operation of transport infrastructure and services;

(b) coordinated procedures for transport development planning; and

(c) reforms in transport regulation to improve system responsiveness to transport demand by different population groups and segments of the national economy, and to increase the recovery of costs incurred in transport system development, maintenance and operation. -5-

The expected effects of the different measures to be taken will be manifold. A reduction of capital budget allocations will become possible as a result of better utilization of existing transport infrastructure which will obviate the need for constructing new facilities in many parts of the country for several years. Concerted transport planning procedures, in which central and local governments will play complementary roles, will enable the assessment of the appropriate timing for critically required transport network extensions, and of the most cost-effective way of achieving suich extensions. But improved utilization of existing transport resources will necessitate substantially increased current budget allocations for transport to meet the financial requirements of appropriate routine and periodic maintenance and the efficient operation of transport infrastructure.

1.10 A special effort is required to assess the costs and benefits of the various subsidy schemes in the transport sector in light of broader fiscal policy, and economic and social development objectives. At present, GOI-s annual budgets are heavily burdened by substantial expenditures for direct and indirect subsidies in the transport sector. The prime effect of all these subsidies in the transport system is that funds available for developing, maintaining and operating transport infrastructure are unduly limited. The bulk of the subsidies is widely diffused in the prices for all transport services and benefit more those elements of the population who are already well provided with transport than those who are not, and those who can pay more than those who are truly poor. The first aim of IO]fs pricing policy in the transport sector has been to control transport fares and tariffs in order to reduce regional disparities in the availability and costs of transport. However, this subsidy policy has not contributed significantly to economic development and equity. Subsidies aimed at reducing regional transport disparities have had limited impact in that they masked the real inefficiencies in the system and impeded i, iovation in transport and the search for low-cost solutions because cost reductions became less urgent as long as GOI covered losses. In addition, subsidies tended to be absorbed by operators and were not always reflected in fares and tariffs. In the context of the proposed action program for improving transport performance (para. 1.08), GOI plans to review in depth its present subsidy policies with the aim to eliminate generalized subsidies and to restrict the benefit of those subsidies, which have been determined to be cost-effective, to particular regions or population groups. To achieve this goal GOI would have to establish a systemized arrangement for analyzing the cost and the benefit of each subsidy and for monitoring its actual impact on the targetted regions or beneficiaries. Special studies have been initiated under Bank-financed highway and shipping projects to review the subsidy schemes and formulate reform proposals directed at improving cost recovery in the transport sector without limiting broader economic and social development objectives.

1.11 The aggregate value of all direct and indirect subsidies in the transport sector amounted to roughly 1% of the gross national product (GNP), or Rp 300 billion in 1979. This amount represents cash subsidies out of the annual budget. Ilowever, the implied economic subsidies are substantially higher. The economic subsidies for petroleum derivates used in transport - 6 -

alone are estimated to have been Rp 750 billion in 1980, comparable to the total transport development budget or about 2% of the GNP. About Rp 136 billicn of GOI subsidies were required to cover the difference between production costs and sale revenues of fuel oil used in the transport sector. In 1980, retail prices of gasoline and diesel (Rp 150 and Rp 53) were 36% and 72% below world market rates, respectively. The already serious burden on the national budget of all existing subsidies in the transport sector is further aggravated by the fact that taxes levied on most users of the transport system are far from covering the development costs of the network. For instance, in FY1980 GOI invested Rp 400 billion to develop arld maintain the road infrastructure whereas road users contributed only Rp 190 billion to these expenditures. The situation in the other subsectors is similar. The tax regime thus provides for an implicit and significant additional subsidy to transport as a whole. In particular, commercial vehicles are subject to extremely low taxes with the result that they contribute only 2% to the cost of developing and maintaining road infrastructure while accounting for almost 80% of total road traffic. A first review of the road user taxation system has been carried out by consultants under the Fourth Highway Project (para. 1.26). Another consultant team financed under the Filth Highway Project (para. 1.27) is presently formulating reform proposals aimed at improving cost recovery in road transport.

1.12 As a first measure to improve the recovery of capital and current expenditures for transport, GOI has decided to single out the richer population groups in Java and Sumatra which have benefitted from high sector allocations in the past and advanced rapidly in economic and social development. It plans to gradually introduce a pricing system for the use of selected network extensions which would imply that users participate more in the costs of constructing and maintaining these extensions. Such extensions will be established and operated as high capacity toll roads; their layouts will ensure significant benefits to the regional economies. A considerable proportion of these benefits will accrue to population groups and businesses which can afford to pay the proposed tolls. But the expected impact of the toll roads will not be limited to enhancing efficiency in the functioning of the regional economies; there will also be a broad social impact in that traffic diverting to the toll roads will induce decongestion of existing roads in densely populated areas. GOI plans to capture the effect of decongestion by promoting public transport, which would be extremely difficult to develop without the extra capacity provided through the proposed toll roads.

1.13 The areas to benefit fromn the toll road developraent program are the already well established economic growth poles in Java and Sumatra. Included in the program are the greater metropolitan areas and hinterlands of Jakarta, Bandung and Surabaya in Java and of Mledan in Sumatra. As a further step to relieving its budgets from financial requirements of the transport sector, GOI intends to finance the necessary investments for sections of the proposed toll road development program partially through bonds floated in the domestic capital market. The proposed project will contribute to increasing cost recovery from road transport using toll facilities. -7-

D. Functional Organizations for Transport

1.14 Three government agencies have prime responsibility for developing the transport system and organizing its operation. The Ministry of Communications (MOC) plans, regulates and controls all transport modes, except highways. Development, maintenance, and administration of the road system are in the hands of the Ministry of Public Works (MPW), through its Directorate General of Highways (DGH). The national planning agency, Badan Perencanaan Nasional (BAPPENAS), reviews sectoral investment plans drawn up by MOC and MPW and prepares jointly with the Ministry of Finance (MOF) related financing plans under the development budget. Both MOC and MPW are large bureaucracies, whereas BAPPENAS is a small organization of about 100 professionals, with less than ten for transport. DGH has some 4,000 employees, including a significant proportion of Indonesia's civil engineers. MPW½-s own organization is replicated at the provincial and kabupaten (district) levels by integrated public works organizations (DPUPs and DPUKs) which report directly to the chiefs of the provincial and kabupaten governments, which in turn are under MRA. DPUPs have a functional relationship with MPW; the Ministry provides them with technical direction and some of their senior staff. DPUKs submit their road plans to the DPUP for review, but they are technically quite independent. The organization of the central and provincial public works organizations in relation to highway administration is shown in Chart 1.

Planning

1.15 The planning process varies among the modes in MOC. For some of the modes, especially lesser ports, river transport and ferries, the central authorities receive proposals for improvements from regional offices and these are then combined in Jakarta into an overall program for each mode. Major port installations and ship supply are planned with some attempt to integrate the two systems. The aviation sector uses the most systematic planning and considerable coordination takes -place with plans for other modes, particularly at the regional level. Major investments under the MOC are subject to feasibility studies. MOC organizes periodic meetings with provincial authorities to review its development proposals but in the past MPW was not formally represented on these occasions although the provincial road authorities do participate. The proposed project will provide for arrangements aimed at improving inter-agency coordination in transport systems management and development planning for the Greater Jakarta Metro- politan Region.

1.16 Highway planning within MPW is most sophisticated and centralized. For some years, DGH has prepared annually a detailed five-year program for all national and provincial roads, totalling about 40,000 km. These programs were based on complete road and bridge inventories and on economic projections for all kabupatens in the country. The programs outline the appropriate treatment for each road section, ranging from maintenance, support works (heavy deferred maintenance), betterment works (improvement on existing -8-

alignment) to new construction. Regional development has always been a significant factor in DGH planning, but there was limited allowance in the analyses for the potential role of other transport modes. In 1979, DGH shifted its long range planning functions to the Directorate General of Housing and Urban/Regional Development (Cipta Karya), one of the main depart- ments of MPW. Cipta Karya has also assumed responsibility for planning guidelines for expanded assistance by GOI to district roads. A national inventory of 70,000 km of distriet roads is underway and Cipta Karya pro- poses to develop with DGH a road programming system for such roads, similar to that for national and provincial roads. The road planning system thus has a well-defined theoretical framework but it depends on large volumes of information being fed into one central location. Until recently the system allowed little scope for priorities and needs as articulated by the provincial authorities. DGH also did not correlate its plans with those of other transport agencies of GOI and instances have been cited of ports and airports without adequate road access, nor did it have explicit discussions with other technical ministries such as agriculture and industry to ensure coordination with their plans. In pursuing transport sector work in Indonesia, the Bank is giving special attention to arrangements for appropriate measures to improve road planning, consistent with regional transport requirements.

1.17 DGH recently introduced a functional classification of roads in accordance with regional hierarchies and distinguishing between arterial, collector and feeder roads. This new classification is incorporated in the national road law wlhich was passed by the National Assembly in December 1980. The new law establishes the functional responsibilities and basic technical criteria for road development and maintenance. The provisions of the law are sound.

Construction and Maintenance of Infrastructure

1.18 As with planning for transport development, the construction and maintenance of the transport infrastructure is the responsibility of MOC and MPW. Typically, the national railways corporation (PJKA) performs these functions for the railway system. MOC through its Directorate General of Sea Communications looks after the expansion and maintenance of ports, shipping lanes and other sea transport related installations; MOC's Directorate General of Air Communications fulfills this function with respect to airports, air control facilities and other air transport related installations.

1.19 MIPW through DGH manages the expansion and maintenance of the road system. Responsibility for highway construction lies with DGH's Directorate of Construction and is executed under a variety of arrangements. The DPUPs are responsible for road works financed under the pPovincial budgets. With the expansion of its road betterment program, DGH plans to delegate the technical and administrative authority for execution of most DGH-financed road betterment projects or bridge replacement projects on national and provincial roads to the DPUPs. Maintenance of the national and provincial roads is carried out by the DPUPs. -9-

1.20 DGH distinguislhes between unstable roads (roads in poor condition) which require support works and represent the bulk of the network and stable roads (roads in good condition) which require only routine maintenance. Allocations for support works and routine maintenance are made from the development budget. Under DGH practice, activities such as ditch cleaning and shoulder repair, normally included under routine maintenance, are not applied to all parts of the network but only to stable roads, even though they could obviate some of the large sums needed for support works. There is an obvious lack of a conventional maintenance system, which is not primarily a problem of available funds, because support works budgets could be diverted to routine maintenance, but primarily a problem of organization and administrative rules. Such road maintenance is executed by the lower tiers of the administration and it is subject to complex restrictions in the use of funds, supply of materials, and deployment of staff. This situation has lead to the neglect of routine maintenance. The Fifth Highway Project addresses these issues with DPUPs, and a rural roads project which is being prepared by GOI for Bank assistance will incorporate more specific measures to improve road maintenance in DPUKs.

Regulation

1.21 MOC has the sole responsibility for regulating the transport industry, its expansion and operation. It is also MOC½s domain to control and enforce the compliance of the different segments of the transport industry with established rules and ordinances. Transport related fees, tariffs, taxes and other charges are fixed and enforced by MOC in cooperation with MOF. Within MOC, the Directorate General of Sea Communications controls the maritime sector, the Directorate General of Air Communications controls the aviation sector, and the Directorate General of Land Communications controls the trucking industry, public transport operation and the private use of motor vehicles.

E. Development and Administration of Toll Roads

1.22 The new road law (para. 1.17) establishes the legal framework for the administration of the proposed toll road system (para. 1.12). The relevant provisions of the law are that "... the Government will transfer jurisdiction over the operationl of toll roads to a State Toll Road Corporation." This provision is a confirmation of Government Regulation No. 4 of 1978 regarding the establishment of a "State Enterprise/ Corporation in the Field of Management, Building and Mlaintenance of a Toll Road Network, and the Operations Provisions". The regulation assigned the responsibility for estab'lishing the toll road corporation to the Minister of Finance who in turn delegated the authority to the Minister of Public Works. The enterprise was officially established as the Indonesian Highway Corporation (Jasa Marga) on March 1, 1978. Legally, Jasa Marga is a Persero, i.e., a State Corporation with limited liability. The act establishing Jasa Marga specifies that the purpose and goal of the corporation are to manage, construct and maintain toll roads. The basic capital of Jasa Marga is fixed at Rp 10 billion of which GOI actually holds Rp 2 billion as preferred shares. The remaining Rp 8 billion are to be obtained throuLIgh the sale of common shares. - 10 -

1.23 Jasa Marga officially assumed its functions in March 1978 by taking over the collection of tolls on the Jakarta-Bogor-Ciawi (Jagorawi) Highway. This highway was officially designated as toll road through Presidential Decree No. 3 of 1978. The only other toll facility in Indonesia is the Citarum Rajamandala Bridge near Bandung which was declared a toll bridge by Presidential Decree No. 34 in 1979. Through its three years of existence, Jasa Marga's activities have been limited to the collection of tolls on the Jagorawi Highway and the Citarum Bridge. The design and construction of toll facilities are being handled by DGH. In January 1981 DGH decided to pass responsibility for maintaining the Jagorawi Highway to Jasa Marga. While the legal, financial and institutional/operational arrangements have been specified, it is presently not possible to fully assess the ability of Jasa Marga to carry out this new responsibility. The organization of Jasa Marga is shown in Chart 2. The proposed project will assist DGH in establishing sound institutional and procedural arrangements for Jasa Marga.

1.24 To date there are no overall criteria established for deciding whether a proposed road should be made a toll facility. Likewise, no explicit economic, financial or technical guidelines have been set for establishing and adjusting the structure and levels of tolls levied on roads or bridges. According to existing legislation, roads or bridges will be declared toll facilities and toll levels fixed through Presidential Decree. There is an obvious need to clarify and/or to formulate criteria for setting the levels of tolls. The proposed project would help formulate such criteria and guidelines. During negotiations, GOI agreed (i) to prepare a study of the structure and levels of tolls to be proposed for the Jakarta- Cikampek toll road, which will be constructed under the project, and (ii) to submit a report on the study to the Bank for its review not later than six months prior to opening of the first section of the toll road.

F. Experience under Previous Bank-Group Financed Highway Projects

1.25 Bank Group lending for 'iighways in Indonesia has been adapted to the evolving needs of the highway system. The First Highway Project ($28 million, Credit 154-IND) helped restore communications in Indonesia after a long period of neglect, by providing eqaipment and materials for rehabilitation of about 3,000 km of roads. The Second and Third Highway projects supported the next phase of Indonesia's road program: construction of major links in remote areas of the country. The Second Highway Project ($34 million, Credit 260-IND) primarily helped rebuild a section of the TransSumatra Highway in an area which is a major site for transmigration development under the Second Transmigration Project (Loan 1707-IND). The Third Highway Project ($14 million, Credit 388-IND) reconstructed a road to a new irrigation area in Sulawesi. It also included an important training component, which initiated courses and set up a nationwide training system for highway personnel, and studies and design of road improvements subsequently financed under the Fourth Highway Project. The construction under the Second Highway Project was completed in 1977 and under the Third Highway Project in December 1978. As detailed in the Project Performance Audit Report (PPAR) SecM81-4, January 6, 1981, the second project had relatively small delays and cost overruns, while the third project had significant delays (mobilization problems in a very remote area and unusually wet weather) and increased construction costs (due to underestimate of quantities and sharp price increases after the oil price rise). The PPAR also noted the importance of providing adequate leadership for and guidance to the study team for regional development plans.

1.26 The Fourth Highvay Project ($130 million, Loan 1236-IND) represented a new departure in several ways. The project (a) sponsored the establishment of four regional Road Betterment Offices; (b) supported a large-scale and complex program for the betterment of existing roads; (c) included assistance to strengthen virtually all functions of DGH; (d) helped initiate studies of other institutions concerned with highways such as provincial and kabupaten public works agencies, and consultants and contractors engaged in highway works; and (e) provided for studies of highway laws, road user charges, and vehicle weights and dimensions regulations. The fourth project responded to the sudden increase in DGH½s betterment program which was made possible by the new funds available to Indonesia after the oil price rise in 1973. The project contributed not only to providing matching funds for construction but also to helping DGH cope with its expanded workload. Although the project is about two years behind schedule because of the multiplicity of contracts, over 1,200 km of road betterments have been put under contract, and 90% of the project had been completed by mid 1981. Positive changes have also been effected in planning, design, budgeting, and control procedures of DGH.

1.27 The Fifth Highway Project (US$130 million, Loan 1696-IND) partici- pates in all important programs of DGH, particularly at the regional level. The project includes: (a) components of DGH's bridge replacement program; (b) road construction and maintenance works executed by eight provincial public works organizations; (c) measures to study and improve the highway institutions in some provincial governments;. (d) expenditures to upgrade road maintenance; and (e) technical assistance to strengthen Indonesian highway consultants and contractors. There have been start-up delays in many components of the project. Road betterment contracts for 531 km out of the 800 km planned have been awarded, and the balance was scheduled for tendering in August 1981. Consultants are in place for construction' supervision, project monitoring, management assistance, a study of the construction industry, and assistance in transport planning and regulation, and consultants are being mobilized for provision of teclhnical assistance to MOC for a national highway safety scheme and development of new regulations for vehicle weights and dimensions. The eight DPUP programs have been defined and equipment tenders have been evaluated; however, increases in the GOI budget for these programs will lead to an expansion of road works. - 12 -

II. THE GREATER JAKARTA METROPOLITAN REGION

2.01 The Greater Jakarta Metropolitan Region constitutes the most important growth center within the Indonesian economy and has advanced more rapidly in economic and social development than other regions of the country. Greater Jakarta has benefitted from high budget allocations in the past, particularly in the transport sector. But population growth and expanding economic activities require a continuous increase in the capacity of the road transport system to meet rising transport demand. To improve cost recovery oif road development outlays, GOI has decided to levy tolls on key road extensions in Greater Jakarta. This decision is consistent with GOI's new fiscal policy objectives in the transport sector (para. 1.12).

A. Regional Development Trends

2.02 Jakarta is the capital of Indonesia, located on the north coast of Java (Map 150136). It constitutes a separate administrative province. Together with the four surrounding kabupatens (districts) of the West Java Province, Tangerang, Bogor, Bekasi and Karawang, it forms the Greater Jakarta Metropolitan Region. About 30% of the country's maritime trade is handled in the port of Tanjung Priok, located within Jakarta's city limits. Besides the functions of a service and trade center for the country, Greater Jakarta has increasingly assumed the lead in national manufacturing. Currently, about 6% of the national GDP is produced in Jakarta; adding the immediate hinterlands, the contribution of Greater Jakarta to the total national economic effort is close to 10% (Table 3). In 1978, Jakarta had a total population of 6 million, and the four surrounding kabupatens about 5.6 million. Compared with the country's total population of about 145 million, more than 8% of all Indonesians were living in the Greater Jakarta region. The presently observed annual population growth of Greater Jakarta is in the order of 420,000, composed of 220,000 natural increase and 200,000 in-migration. Jakarta and its hinterlands receive close to 40% of national migration and account for as much as 46% of national urban growth. It is estimated that Greater Jakarta will exceed 20 million inhabitants by the end of the century.

2.03 The total employment in Greater Jakarta was close to 3.4 million in 1978, including about 1.75 million in Jakarta and 1.65 million in the surrounding kabupatens. About 6.5% of all employment in Indonesia is concentrated in the Jakarta growth center. For the year 2000 an employment level of 8.5 million is projected. The regional GDP is expected to grow faster than the national GDP to reach 11.5% of national GDP by the end of the century. The large-scale manufacturing sector is expected to grow fastest, leading to further regional specialization. Reflecting the booming economy of Jakarta and its satellite kabupatens are the observed increases in per capita income, which is about 10% above the national average. - 13 -

2.04 There has been a considerable difference in population and economic growth within the regional system of Greater Jakarta. While Jakarta's population increased about 4% per year between 1971 and 1978, the surrounding kabupatens experienced annual growth rates as follows: Bogor 3.1%, Tangerang 2.4%, Bekasi 1.8% and Karawang 2.0%. Such of the growth in the kabupatens has been generated by the overspill of new manufacturing jobs from Jakarta along the national roads to the east and west due to the com- paratively low cost of industrial land further out from Jakarta along these routes. The kabupatens around Jakarta are still considerably rural in character with almost two-thirds of employment in agriculture and about 25% in trade and services. Less than 5% of the kabupaten population is presently employed in modern manufacturing jobs. Projections have been made of population growth in the region and these are based on trends in natural increase and intraregional migration, and the likely employment creation across the region. The population growth of Jakarta is expected to slow whilst the surrournding kabupatens will increasingly account for the overflow of Jakarta population, particularly Tangerang and Bekasi which are expected to expand their roles in the metropolitan Jakarta system. The estimated interregional population increases are as follows:

Average annual 1978 1993 2003 increase (%)

Jakarta 6,005,160 9,720,000 11,315,000 2.6 Bogor 2,278,470 3,903,000 4,398,000 2.7 Tangerang 1,257,210 2,041,000 2,819,000 3.3 Bekasi 949,690 1,721,000 2,258,000 3.5 Karawang 1,003,000 1,517,000 1,999,000 2.8

2.05 From a review of key economic activities in the Jakarta region, their recent trends and likely future development, it is envisaged that a deconcentration of leading economic activities from Jakarta to the surrounding kabupatens is likely to occur. There are several features in this forecast pattern of regional development which would contribute to the longer term structure of the regional hierarchy. This is largely due to the rapidly increasing expansion of economic activities, growing demand on Jakarta to fulfill its function as principal trade center of the country, and a population which increases daily by about 600, all of which has put an enormous pressure on Jakarta's infrastructure and finances. Jakarta has reached a population size and growth trend which causes the urban economy to become increasingly inefficient. In addition, growing demand for land, infrastructure and basic services will rapidly limit Jakarta's ability to meet such needs equitably, given its actuial resource constraints. The consequences of changes in regional hierarchy will include substantial - 14 -

restructuring in the subregional economies. The relative share of agriculture as part of the economic activities in the suburban kabupatens will decline, and the importance of other activities will increase, notably that of manufacturing. The expected percentage changes in employment by sector in three subregional economies are as follows:

Jakarta Tangerang Bekasi 1978 1993 1978 1993 1978 1993

Agriculture 2.9 1.7 10.7 4.0 22.1 9.0 Manufacturing 10.6 9.7 46.6 51.7 32.0 46.2 Government 12.7 12.2 16.0 9.3 9.8 9.8 Trade and services 73.8 76.4 26.7 35.0 36.0 35.0

Total employment 100.0 100.0 100.0 100.0 100.0 100.0

The projected changes will have the highest impact on Bekasi where required structural adjustments to accommodate population growth and to provide the required infrastructure for rapidly expanding economic activities will be considerable.

B. Metropolitan Finance

2.06 Substantial budgetary allocations will be necessary to meet the financial requirements of the structural adjustments in the regional economy. Several plans have been drawn up to establish the infrastructure which will be necessary to adjust the region to anticipated population shifts and spatial changes in the location of economic activities. The estimated costs of some of the major related projects and the regional development budget allocations in Repelita III are shown in Table 4. The estimated investment requirements of the transport system alone represent almost 70% of the total development budget for the region. There is a resource gap of 36% in the capital budget requirements. The regional economy is already receiving 40% of all investments in urban areas in Indonesia, and 30% of private investment throughout the national economy. Over the last six years, GOI expenditures in Jakarta alone have amounted to 15% of all national public development expenditures. Looking at the current budget requirements of maintaining and operating public services and infrastructure in the region an even bleaker picture emerges. The local governments of both Jakarta and the surrounding kabupatens require substantial transfers from GOI to cope with their responsibilities. Total GOI transfers to Jakarta have increased at 10.6% annually in real terms between 1972 and 1978. They presently - 15 -

amount to 27% of all revenues accruing to Jakarta's government. More than 50% of the annual revenues available to the kabupaten governments in the region come from GOI in the form of subsidies. Reforms are urgently required to increase the region's internal revenue base and to reduce the costs of coping with the development and maintenance of the regional economy, essentially through better regional management. GOI has become increasingly concerned about the growing proportions of the annual national budgets which have to be allocated to Greater Jakarta.

C. Regional Planning

2.07 In 1976 a planning team was established under a Presidential Instruction. This team includes representatives of central and local government institutions and has the mandate to draw up a development plan for Jakarta and the kabupatens of Bogor, Tangerang and Bekasi. This area is called JABOTABEK, an acronym formed of the first letters of Jakarta and the names of these entities. The planning team was to review the regional and sectoral development plans prepared by central and provincial government agencies. The team was also to review the existing organizational arrangements, the policy framework and general practices of managing the Greater Jakarta Metropolitan Region. The Second Urban Development Project (Loan 1336-IND) provides technical assistance to the JABOTABEK planning team. The team has already prepared a series of specific recommendations for controlling regional growth and improving management of the regional economy. GOI is presently reviewing these recommendations; it is expected that several reforms of existing practices and arrangements in regional management will be instituted. Specifically it is expected that an overall technical secre- tariat will be established by mid-1982 supported by three specialist subcom- mittees for transport, water resources, and land use planning. Furthermore, there are indications that a regional development strategy will be adopted in line with the JABOTABEK planning team's recommendations. The recommended regional development strategy is based on obse*rved growth trends (para. 2.05) and identified locational advantages.

D. Regional Transport

2.08 A critical factor in the region's development is transport. Through .ts direct impact on land-use development, the regional transport system will exert considerable influence on spatial growth. If Greater Jakarta is to achieve a high economic efficiency, transport infrastructure and services must be developed and maintained which respond to existing and emerging transport demand generated by various economic activities. At the same time it is mandatory that the regional transport system be geared to effectively address the transport needs of all segments of the population. The region's existing 16 -

transport system is presently not meeting the above criteria. In several zones, the transport system is reaching its capacity limnits, which will increasingly restrain the development of economic activities and reduce or limnit mobility of local population. There are also areas where existing transport resources are totally inadequate in terms of spatial coverage and service provision. The populations in such areas are almost completely excluded from economic and social development.

2.09 One of the reasons for the poor state of the regional transport system is the lack of appropriate arrangements for transport planning and systemii management. Not fewer than 15 agencies have responsibilities for 'regional transport, including six central, one regional, and eight local government institutions (Table 5). Of particular importance are the relatively strong powers of central governmental agencies in the region and the absence of any effective regional authority for coordinating their policies and investment activities with those of local government and with one another. As a result of diffused responsibilities for transport in the region, sectoral development plans have been developed in the past which were often based on conflicting objectives and strategies of the government institutions involved in planning and implementing transport programs. This is an important issue in the formulation of a cost-effective and demand- responsive long-term development and management strategy for the regional transport system. The emergence of an authority responsible for coordinating central, regional and local government policies and programs for transport throughout the region would be a key component for such a strategy. The proposed project will provide assistance for establishing appropriate procedures and arrangements to plan and manage the development of transport in the Greater Jakarta Metropolitan Region.

F. Regional Development Strategy

2.10 As a consequence of emerging regional spatial growth trends (para. 2.04) the bulk of future industrial development and population growth will take place to the east and west of Jakarta, extending along the existing roads to Tangerang (to the west) and Cikampek (to the east). There is general consensus that this represents the most efficient metropolitan spatial development pattern within the context of regional topography and factor endowments. The JABOTABEK planning team (para. 2.07) has come to the same conclusion and recommends a "Guided Land Use" strategy to support these trends in spatial growth. But the local transport network is progressively becoming saturated and cannot support much growth. Also, the increasing importance of Tanjung Priok as main gateway to Indonesia will attract and generate more traffic than can be accommodated by the existing transport infrastructure. Finally, interregional traffic, particularly in the Jakarta-Cikampek corridor, has been growing rapidly and constitutes a substantial burden to Jakarta's network (Table 6). There is presently no - 17 -

alternative for interregional traffic but to pass through Jakarta. Consider- able new road capacity is required to accommodate increasing traffic volumes and foster efficiency in the regional economy. The capital requirements for constructing additional road capacity are enormous, which is reflected by the high proportion of Repelita III provisions to the region which has been allocated to transport (para. 2.06). Clearly, local governments within Greater Jakarta are not in a position to mobilize the required funds for constructing the road network extensions, given their resource constraints (para. 2.06). As a consequence, GOI would have to divert additional funds from its annual national development budgets and earmark them for use in Greater Jakarta to ensure that the required road network extensions are constructed and maintained. The result would be that less development funds would be available to other regions of the country.

2.11 Consistent with its transport sector policy of regional equity for funding transport development (para. 1.12) and of improving recovery of the costs of constructing, maintaining and operating transport infrastructure (para. 1.09), GOI has decided to levy tolls on the major road network extensions in Greater Jakarta. Details of the proposed regional toll road system are shown on Map 150136. A substantial percentage of the construction costs is intended to be financed through bond issues (para. 1.12). The proposed financing arrangements for constructing, operating and maintaining required road network extensions in Greater Jakarta would imply reduced need for central government assistance in regional development. The revenue base within the Greater Jakarta Metropolitan Region would be considerably increased.

2.12 Within the Greater Jakarta Metropolitan Region additional road capacity is most urgently required in the zone east of Jakarta. This zone inclades the kabupatens of Bekasi and Karawang where substantial restructuring r-f economic activities and increases of population have taken place (paras. 2.04 and 2.05). Within both kabupatens transport demand has grown rapidly and their transport system has also to accommodate the bulk of interregional passenger and commodity flows in the Jakarta-Surabaya corridor. Existing transport infrastructure traversing both kabupatens and connecting them with Jakarta is limited to one highway and one railway line. Actual traffic flows have reached capacity limit on the highway. The railway line does not provide sufficient service to relieve the highway. As a consequence, additional road capacity is urgently required to better meet transport demand and to ensure continuation of spatial growth trends in economic activities and population within the kabupatens of Bekasi and Karawang, in line with the development strategy for Greater Jakarta (para. 2.11).

2.13 To meet the requirement of additional road capacity in the kabupatens of Bekasi and Karawang, GOI has decided, to construct a toll road between Jakarta and Cikampek. This toll road will traverse both kabupatens and connect them with Jakarta. It will also constitute an improved link in the Jakarta-Surabaya transport corridor and facilitate interregional road traffic in Java. Construction of the Jakarta-Cikampek toll road will be a major component of the proposed project. - 18 -

III. THE PROJECT

A. Project Objectives

3.01 The proposed project will provide the urgently required increase in the capacity of the road network in the corridor between Jakarta and Cikampek with provisions for high cost recovery. In addition it will improve the management of, and development planning for, the transport system in the Greater Jakarta Metropolitan Region.

B. Project Scope

3.02 The project comprises the following components:

(a) construction, including supervision, of (i) a new highway from Jakarta to Cikampek with a length of 72 km, including about 34 km of collector and spur roads, and facilities for operating the highway as a toll road; and (ii) betterment works on the Bekasi-Cikampek section (63 km) of the existing Jakarta-Cikampek road which the new highway would parallel;

(b) toll road management assistance; and

The location of the two project roads is shown in map IBRD 15036.

C. Detailed Project Description

Civil Works

New Highway

3.03 In 1974-75, a proposal for a new highway connecting Jakarta and Cikampek was studied in detail, and a thorough investigation of possible alignme'nts was carried out. For this work, DGH received assistance from a joint venture of two German consulting firms, Intertraffic and Lenzconsult. The detailed engineering began in late 1977 and was financed under the Fourth Highway Project. Two German firms, Dorsch Consult and Haasconsult, under the name of Arge INDOC, carried out the work in association with an Indonesian consulting firm, P.T. Indec and Associates. - 19 -

The final design, including all tender documents, was completed in January 1979. During the Bank's appraisal mission of May 1980 some additional work, two spur roads and three more interchanges, which originally had been planned to be built in a later construction stage, w.7as advanced for inclu- sion in the initial construction phase. The detailed engineering of these additions is currently underway with scheduled completion in August 1981.

3.04 The new highway is located to the south of the existing road, at a distance ranging from 0.5 km to 10 km. For about three quarters of its length, it runs parallel with and close to the Jatiluhur Irrigation Canal (Map 150136). The highway is designed with an asphalt concrete pavement and would have from 2 to 4 lanes at the initial stage; the most densely trafficked section from Jakarta to Cibitung (Section A, 24.5 km) will have 4 lanes, and the remainder (Section B from Cibitung to Karawang, 23.0 km, and Section C from Karawang to Cikampek, 24.5 km) 2 lanes for the first 5-6 years after opening. At a later stage two more lanes will be added as traffic volumes increase. However, the full formation for 4 lanes will be constructed during the initial stage on Section B, where the soil conditions are soft, to permit longer time for settlements to occur before paving the two additional lanes. The third construction stage is planned for the year 2000 in which 2 more lanes would be added between-Jakarta and Bekasi, the first 14 km stretch of Section A. The design allows for an eventual expansion of the highway to 8 lanes on Section A and to 6 lanes on Sections B and C. The design has followed DGH geometric standards for Class I highways (Table 7) with some reductions in shoulder width (2.5 m instead of 3.0 m) for the entire road length and in lane width (3.60 m instead of 3.75 m) on Section A passing through a more urbanized area than the other 2 sections.

3.05 The new highway will be fully access-controlled and all crossings with other roads will be grade-separated. Access to the highway will be provided at eight interchanges which will be constructed during the initial stage. The interchanges are spaced from 3 to 8 km apart on the section closest to Jakarta, and up to 18 km apart on the least trafficked section near Cikampek. In addition to the interchanges, the project includes a number of spur roads to provide connections to the existing road network. The spur roads, with a total length of about 34 km, will be 2 lane roads with a carriageway width of 7.0 m and two 2.0 m shoulders; about 20 km will be new construction, and the remainder improvements to existing roads. The carriageway will be paved with asphalt concrete. Grade separation will be provided at three locations where the spur roads intersect with major arterials in the Jakarta street network.

3.06 While the through traffic at the Cikampek end will continue towards .Cirebon or Bandung along the existing national and provincial highways, the traffic distribution at the Jakarta end will require special measures. DGH will build a major interchange at the western terminal of the toll road to handle the traffic between this road and the existing toll road - 20 -

to Bogor, the arterial street system of Jakarta and the access road to Halim International Airport, as well as the proposed intra-urban toll road system (para. 2.11). The construction of the first phase of this interchange (the so-called Jakarta Interclhange) will start shortly with financial assistance from OECF (Japan). The startLng point of the Jakarta-Cikampek toll road is located just east of the Jakarta Interchange and will therefore be easily accessible from Jakarta as soon as it opens.

Existing Road.

3.07 After opening of the new highway, traffic remaining on the existing road will continue to be substantial. The existing road is 78 km long between Jakarta and Cikampek. The first 15 km section between Jakarta and Bekasi has been upgraded in recent years; the remaining 63 km section from Bekasi to Cikampek will be improved under the project.

3.08 The existing road has a 4-lane, 15 m wide, undivided carriageway from Jakarta to Bekasi and 2 lanes with total width of 7 m beyond. The pavement structure is sound and the surface is in good condition but there are several sharp curves and many major at-grade road intersections. Road shoulders are soft and narrow, and not suited for vehicular traffic. The existing road provides direct access to adjacent properties in the townships and villages through which it passes. Seven at-grade railway crossings represent a major obstacle to the traffic flow because they have to be closed to road traffic for more than 60 scheduled daily trains.

3.09 Detailed engineering for the betterment program was prepared in 1980 by the same consultants who establis'hed the detailed engineering for the new highway (para. 3.03). The betterment program will alleviate most of the adverse traffic conditions on the existing road. The program will not directly affect the existing carriageway and traffic disruption during construction should therefore not be a major problem. The program includes the following components:

(a) construction of a 9.3 km long by-pass with 2 lanes around Karawang avoiding the town center and two railway crossings;

(b) construction of one railway overpass;

(d) construction of hard, bitumen sealed shoulders over the entire length from Bekasi to Cikampek;

(e) low cost traffic management measures, such as intersection improvements, pavement markings, road signs, and line delineators; and

(f) drainage improvements. - 21 -

Consulting Services

Construction Supervision

3.10 DGH is proposing to retain consultants to assist in construction supervision. It is expected that Indonesian firms in joint venture with expatriate consultants would provide a major manpower input to the supervision team. The duration of these services will be at least five years for the new road construction and about three to four years for the betterment works on the existing road.

Toll Road Management

3.11 In connection with feasibility and preliminary engineering studies of individual toll road sections over the last 4-5 years, the technical, economic and financial aspects associated with levying tolls on the roads have been studied. Based on the findings of these studies, DGH has drawn up an overall framework for the development and implementation of a national toll road program over the next 10 years. DGH finds that there is a need for strengthening of the toll road authority Jasa Marga to cope more efficiently with an eApanding work program and increasingly complex tasks and responsibilities. DGH will therefore carry out, with assistance from consultants, an action program which will help Jasa Mvarga in determining procedures and improving its capacity for efficient toll road operation. The action program will review Jasa Marga's financial structure and objectives, and its institutional and procedural arrangements. A training program will be prepared for Jasa Marga staff in the fields of management, engineering, finance, accounting, and traffic control. During negotiations, assurances were obtained that GOI will take steps to carry out such training programs on a regular basis in step with the expansion of Jasa Marga's activities. The total man-month requirements for the technical assistance have been estimated at about 75 man-months, which will be financed under the project.

Regional Transport Systems Management and Development Plans

3.12 Institutional arrangements and responsibilities for transport development and transport system management are highly diffused and uncoordinated at the national level (para. 1.07) as well as at the regional level (para. 2.10). This situation is increasingly hampering GOI's ability to efficiently and equitably address existing and evolving transport demand within the national economy. There is an urgent need to find ways and means on how the transport system can be geared to fulfill its economic and social role in regional development, without unduly diverting budget allocation from other important sectors of the national economy. The basic strategy to improve overall transport sector performance and responsiveness to actual and projected transport demand, subject to budget constraints, would be: - 22 -

(a) to improve coordination among (i) central, regional and local government line agencies with responsibilities for transport planning and management, and (ii) transport service operators; and

(b) to increase the participation of the regional transport users in financing the costs of developing, operating and maintaining such systems.

3.13 GOI recognizes the need for measures aimed at improving national and regional transport development planning and system management (paras. 1.08, 1.09 and 2.07). As a start on introducing such measures, the project will help establish and implement arrangements for improved regional transport planning and system management in the Greater Jakarta Metropolitan Region. Consequently, the project provides financing for about 75 man-months of related consulting services.

D. Project Costs

3.14 The total costs of the project, including contingency allowances and land acquisition cost, are estimated at about US$357 million, of which about US$182 million (or 51%) would represent the foreign exchange component. Details are shown in Table 8 and a summary is given below. The base cost estimate is in June 1981 prices. All costs were reviewed and confirmed during loan negotiations. An estimated tax component of 14% is included in the project costs.

3.15 Cost estimates for the civil works, i.e. construction of the new highway and improvements on the existing road, were prepared by the design consultants. The estimates are based on completed final engineering,/l using unit prices established by detailed price analyses. This work was combined with a review of unit prices for similar road works obtained from international competitive bidding for two toll road projects with a total length of 66 km, and more than 2,000 km of betterment works tendered during the last two years. Land acquisition costs were assessed by the design consultants from area requirements determined through the final engineering, and basic prices of land as published by the local office of the Agraria, a central land agency under MHA. The costs of relocating houses and businesses (para. 3.23) are mission estimates, amounting to US$7,500 per operation, on average.

/1 Except for three interchanges on the toll road and two spur roads, which were added later and for which only preliminary cost estimates are available (para. 3.03). The additions represent less than 15% of the total costs of the civil works, and final engineering was scheduled for completion in August 1981. - 23 -

Project Costs

Local Foreign Total Local Foreign Total Project component .Rp billion ------US$ million-

I. Civil Works A. New highway 47.5 71.2 118.7 76.0 113.9 189.9 B. Existing road 3.6 5.4 9.0 5.8 8.6 14.4

Subtotal 51.1 76.6 127.7 81.8 122.5 204.3

II. Consulting Services A. Supervision 4.0 3.9 7.9 6.3 6.4 12.7 B. Studies & technical assistance 0.2 0.8 1.2 0.4 1.2 1.6

Subtotal 4.2 4.7 8.9 6.7 7.6 14.3

III. Contingencies A. Physical 5.6 8.1 13.7 8.9 13.0 21.9 B. Price 28.5 24.0 52.5 45.7 38.3 84.0

Subtotal 34.1 32.1 66.2 54.6 51.3 105.9

IV. Land Acquisition and Property Compensation 19.5 0.5 20.0 31.1 0.9 32.0

Total Project Costs 108.9 113.9 222.8 174.2 182.3 356.5

3.16 The cost of c(,nstruction supervision is estimated at 8% of the construction costs for the betterment works on the existing road and about 6% for construction of the new highway. For the existing road the percentage corresponds to what was earmarked for the same type of work under the Fifth Highway Project, while a lower percentage has been used for the large-scale, high-cost, geographically concentrated work activities on the new highway. In estimating these percentages, a major input from local consultants has been considered. Cost estimates for the studies and technical assistance are based on estimates of the number of man-months required taking into account that a higher proportion of these services than of construction supervision would be provided by foreign consultants. The average man-month cost for expatriate consultants, including the cost of travel and allowances (estimated at US$1,500 equivalent per man-month), is about US$8,000-9,000. The man-month cost for Indonesian professionals is about US$1,500-2,500 equivalent. In addition to these costs, local - 24 -

facilities, related equipment, and materials are estimated at US$500-1,000 per man-month for both Indonesian and expatriate professionals. All these estimates are reasonable.

3.17 A contingency allowance of 10% has been added to cover quantity increases on all items. For calculation of price contingencies for local costs, specific projections for Indonesia have been used as follows: 9% for the second half of 1981, 14% in 1982, and 10% p.a. thereafter. In accordance with Bank guidelines, the foreign cost component was assumed to escalate at different and somewhat lower rates as follows: 9% in 1981, 8% in 1982, 7% p.a. in the years 1983-85, and 6% p.a. thereafter. With cost estimates based on mid-1981 prices and the proposed project implementation schedule (Table 8), the assumed escalation rates result in total price contingencies of 31% of the base cost (including land acquisition) plus physical contingencies.

3.18 The foreign exchange component of the civil works has been estimated by the design consultants at about 60%. For consulting services the foreign exchange component has been estimated on the basis of the anticipated participation of foreign and local staff at 50% for construction supervision, and 80% for studies and technical assistance (where expatriate consultants would provide most of the manpower). All these foreign exchange estimates are reasonable.

E. Project Financing

3.19 The Bank loan of US$85 million will finance 24% of total project costs, which corresponds to 47% of the estimated foreign exchange component. The Bank loan will be applied to Section A of the toll road and the improvements on the existing road, to the consulting services for construction supervision of both roads, and to the consulting services for studies and technical assistance. The Kuwait Fund for Arab Economic Development (KFAED) will finance US$60 million representing 17% of total project costs. The KFAED loan will be applied to two sections, B and C, of the toll road, and to the consulting services for construction supervision of both the toll road and the betterment works on the existing road. The gap in financing the entire foreign exchange component will amount to about US$37 million which will be covered by GOI from a special account. GOI will finance its part of the civil works on the existing road, including construction supervision, as well as studies and technical assistance, from the development budget.

3.20 All local costs for construction and supervision of the new highway will be covered through a special GOI investment account. Land acquisition, including costs for relocation of housing and businesses, for both the toll road and the improvements on the existing road will be - 25 -

financed out of a separate GOI account for this purpose. During negotiations, assurances were obtained that GOT will provide funds promptly to cover its share of the project and any shortfalls in the financing plan which might occur during project execution. The total financing plan is summarized below.

Project Financing Plan

Total GOI KFAED IBRD US$ US$ % of US$ % of US$ % of Project component mln. mln. total mln. total mln. total

Construction of New Highway Section A 140.4 72.3 52 - - 68.1 48 Sections B and C 142.1 87.0 61 55.1 39 - - Supervision 18.0 9.0 50 4.5 25 4.5 25 Land acquisition and property compensation 27.6 27.6 100 - - - -

Subtotal 328.1 195.9 60 59.6 18 72.6 22

Improvements of Existing Road Improvement works 20.3 10.5 51 - - 9.8 48 Supervision 1.5 0.7 50 0.4 25 0.4 25 Land acquisition and property compensation 4.4 4.4 100 - - - -

Subtotal 26.2 15.6 59 0.4 2 10.2 39

Studies and Technical Assistance 2.2 - - - - 2.2 100

Total 356.5 211.5 59 60.0 17 85.0 24

F. Implementation, Procurement, and Environmental Aspects

Implementation

3.21 MPW, through its DGH, will be responsible for carrying out the project, as in the five previous highway projects, except for the JABOTABEK regional transport system management and development studies. DGH will be supported by consultants for supervision of the construction work. Consulting services will also be arranged for the toll road management - 26 -

program and the regional transport studies. The details of the consulting services for the regional transport studies will be decided collectively by the GOI agencies (DGH, Cipta Karya, MOC, BAPPENAS, DKI, and the West Java Provincial Government) who will constitute the subcommittee on transport to be established for the purpose of JABOTABEK planning (para. 2.07). These agencies would decide which agency among them would be administratively responsible for the consultant contract. During negotiations, assurances were obtained that GOI would not issue notice to proceed to construction contractors awarded contracts under the project, unless arrangements have been finalized for retaining consultants for supervision.

3.22 Land acquisition for the new highway and for the two bypasses on the existing road is currently underway. At negotiations, GOI provided a status report on the land acquisition, and agreement was reached with GOI on a satisfactory work program and timetable for the land acquisition. Cadastral surveys of the affected areas are scheduled for completion in late June 1981. The actual amounts to be paid in compensation are usually decided in negotiations with the landowners, after which payment of compensation can be initiated. Provided the surveys and negotiations are completed on schedule, there will be almost one year before construction activities get underway which should be adequate to complete the land acquisition.

3.23 Implementation of the proposed project would require the relocation of about 1,000 houses and businesses which are presently located within the right-of-way required for upgrading the existing Jakarta-Cikampek Highway and for constructing the new toll road. During negotiations, agreement was reached on compensation arrangements for households and businesses which would be relocated. GOI gave assurances that timely action will be taken to relocate the concerned households and businesses in a way that implied hardship would be kept at a minimum and that no delays in construction would be experienced.

3.24 DGH is planning to invite bids for the construction wonk during the second half of 1981. Allowing three to four months for tender preparation and four to five months for bid evaluation, it is expected that construction would get underway in mid-1982. The first part of the new highway to be opened will be the Jakarta-Bekasi West subsection of Section A which is scheduled for completion in late 1985, followed by the remainder of Section A in late 1986, and Sections B and C in mid-1987. The construction time for the improvement work on the existing road is estimated at three to four years with completion in late 1985. During loan negotiations, agreement was reached with GOI on the proposed Project Implementatioll Schedule (Table 9) and on arrangements for reporting progress including preparation of a completion report within six months of the Closing Date.

3.25 Major road works are carried out with a blend of labor- and capital-intensive methods which gives full recognition to the availability of low-cost semiskilled labor in Indonesia, without undue sacrifice in the - 27 -

quality and cost of the works. The same methods will apply to the works to be financed under the project, although it is anticipated that the construction work on the new highway will tend to be more capital intensive than on the existing road because of the much larger scope of work. However, many construction operations are labor-oriented such as ditch and shoulder excavation, and bridge and culvert construction. The overall scale of the project will make a significant contribution to employment creation; US$1 million of construction work is estimated to provide about 20 man-years of skilled jobs and 100-150 man-years of semi-skilled jobs, or a total number of man-years under the project of about 4,500 for skilled and about 25,000 for semiskilled workers.

3.26 Upon completion of the construction) DGH will hand over the new highway to Jasa Marga for operation and maintenance. An agreement stipulating the hand-over and financial arrangements will be entered into between GOI and Jasa Marga. Under the agreed bidding documents, the contractor on each road section, who will become thoroughly familiar with local conditions, will be required to prepare an appropriate maintenance program for the road section. Allowances have been made in the financial projections for Jasa Marga for an adequate level of funding for this purpose. However, assurances were obtained from GOI during loan negotiations that it will cause the new highway to be maintained in accordance with the accepted maintenance programs, that the terms and conditions of the hand-over agreement will be satisfactory to the Bank, and that it will cover any shortfalls in financing Jasa Marga-s operation and maintenance program for the project road.

3.27 Maintenance of the existing road (and the two new bypasses) will continue to be the responsibility of DGH's Directorate of Maintenance which executes the field work through the West Java provincial public works office. This office is also in charge of maintenance of other national and provincial roads in the area while the kabupaten (district) roads are being maintained by the kabupaten public works offices (DPUKs). Arrangements for improved road maintenance are underway in the project area, partly assisted by the Fifth Highway Project (para. 1.27) for national and provincial roads, but there is a particular need to improve maintenance of the kabupaten roads in the cnrTridor which includes the two kabupatens of Bekasi and Karawang. During negotiations, assurances were obtained that GOI will continue to take steps to improve the maintenance of all public roads in the corridor area.

3.28 A study of vehicle weights and dimensions carried out under the Fourth Highway Project led to the conclusions that it would be worthwhile to allow larger and heavier vehicles with higher axle loads to operate on the roads in Indonesia than the current regulations permit. MOC, assisted by consultants financed under the Fifth Highway Project, is in the process of preparing an action program to put the results of the study into effort. The design of bridges and pavements on the new highway was carried out in accordance with DGH's guidelines and design standards, and heavy vehicles - 28 -

with axle loads of up to the proposed single axle load limit of 10 tons could easily be accommodated on the highway. However, during negotiations, GOI agreed to ensure that the dimensions and axle loads of vehicles using the new highway will not exceed limits consistent with the standards to which it had been designed.

Procurement

3.29 DGH intends to invite proposals from a short-list of consulting firms for the supervision work and the consulting services for toll road management assistance to be financed under the project, and for which DGH will be responsible. Selection of consultants and award of contracts would be made after a detailed evaluation of the proposals have been made. The agency to be responsible for the JABOTABEK regional transport studies (para. 3.21) will follow the same procedure. During negotiations, assurances were obtained that GOI would employ qualified and experienced consultants acceptable to the Bank, and on terms and conditions satisfactory to the Bank.

3.30 The road construction and improvement will be carried out under unit price contracts awarded on the basis of international competitive bidding by prequalified firms. Since the construction work will be financed through a parallel financing arrangement by the Bank and KFAED, prequalification of contractors will be made simultaneously but separately for the respective parts of the works to be financed by the two co-lenders. The Bank's procurement guidelines will be followed for the Bank-financed parts, while KFAED will apply its own guidelines for international competitive bidding for the parts of the works to which it would contribute. The insertion of the general procurement notice in Development Forum was made in late April 1981. The work on the new highway is divided into three contract sections, and DGH will allow prequalified contractors to bid separately on all three sections as well as on the section of the existing road. Separate bid evaluation will be made for the sections financed by the Bank and KFAED, respectively. These arrangements for tender evaluation and contract award were agreed with GOI during negotiations. The proposed bidding documents have been prepared and they contain appropriate provisions for price adjustments, performance guarantees, etc.

Environmental Aspects

3.31 The project will overall produce better environmental conditions. It has been carefully designed to avoid any significant adverse ecological effects. The betterment works on the existing road will reduce congestion, eliminate or reduce waiting time at railroad crossings, and thus reduce air pollution, and what is more important, they should result in a reduced accident rate. The new highway is generally located outside urban settlements and although valuable agricultural land will have to be acquired for the road's right-of-way, the disruptive effect of the selected alignment is minimized. The new road will take a major part of the traffic in the - 29 -

corridor, and this will in itself substantially improve the environmental conditions on the existing road. The alignment of the toll road is running parallel with and close to the Jatiluhur Irrigation Canal which already constitutes a hindrance for north-south traffic movements. Overpasses on the toll road will be provided for all important crossing roads in addition to the interchanges, which also will allow access to the toll road. Pedestrians are accommodated by sildewalks on the structures for vehicular traffic but an additional number of overpasses has been provided exclusively for the use of pedestrians, particularly to provide connection between villages. Pedestrians will in several locations also be able to use combined drainage and pedestrian culverts.

G. Disbursements

3.32 A schedule of estimated disbursements (Table 10) has been prepared. It was reviewed and agreed with GOI during negotiations. Disbursements from the Bank loan will be made on the basis of:

(a) 50% of the total construction expenditures for Section A (para. 3.04) of the toll road, and for the betterment works on the existing road;

(b) 25% of the total expenditures for the consulting services for construction supervision; and

IV. PROJECT JUSTIFICATION

A. General

4.01 Implementation of this project will be an essential prerequisite to spatial development in the Greater Jakarta Metropolitan Region, consistent with the regional development strategy determined by the JABOTABEK planning team (para. 2.07). Furthermore, improved transport infrastructure in the Jakarta-Cikampek Corridor will enhance productivity in the subregional economies of the kabupatens Bekasi and Karawang and substantially increase mobility of all segments of the local population.

4.02 In addition to broad impacts on regional development, the project will initiate studies aimed at transport systems management and development planning. Finally, the project will provide GOI with an experimental basis - 30 -

for increasing recovery of the costs associated with constructing, operating and maintaining transport infrastructure. This is in line with GOI's intentions to arrange for reducing subsidy requirements in the transport sector (para. 1.12).

B. The Jakarta-Cikampek Corridor

4.03 The Jakarta-Cikampek Corridor constitutes a major development zone radiating out to the east from Jakarta. It traverses the kabupatens of Bekasi and Karawang. Substantial spillover of population and commercial/ industrial activities from Jakarta has been taking place within the corridor; all indications are that this trend continues in an accelerating fashion. Regional development plans have been drawn up which promote this spontaneous trend (para. 2.07). Growing population and expanding economic activities require adequate transportation to ensure access to markets and mobility. Within the corridor there are only two transport links, the Jakarta-Cikampek road and a railway line which forms a section of the Jakarta-Surabaya railway. In both goods and passenger transport in the corridor, the railways have a relatively minor share. Only 11.5% of all person-trips generated within the corridor are made by rail, and about 5% of all goods movements in the corridor are by rail. These percentages represent long distance transport, mostly with origins and destinations outside, to the east of the corridor. Goods moved by rail are generally bulk commod- ities. But person-trips and goods movements in the corridor are by and large over short distances with origins and destinations inside the corridor. Most goods are transported in small consignments, often with several recipients per consignment. The railways cannot provide services to efficiently meet transport demand characteristic for the corridor. Required flexibility for person travel and goods movements within the corridor can only be provided by road transport. As a consequence, the bulk of existing and evolving transport demand in the corridor will have to be accommodated within the road transport system.

4.04 The Jakarta-Cikampek road is the only existing infrastructure facility available for interregional and intrakabupaten road transport. More than 80% of the road is located in built-up areas with a mix of residential, commercial and industrial land uses. Considerable traffic is generated and attracted by these different land uses. In addition to its functions in the transport system of the Greater Jakarta Metropolitan Region, the road has to accommodate traffic originating beyond the region in other parts of Java and with destination in Jakarta or west of the metropolitan region. The growing importance of the two kabupatens Bekasi and Karawang within the regional economy (para. 2.05) can be demonstrated by changes in traffic on the Jakarta- Cikampek road. The results of traffic volume counts and observed traffic compositions on the road between 1969 and 1980 are given in Table 11. There are principally four categories of motorized transport on the road: 31 -

(a) passenger cars; partially privately owned, but a large proportion is company or government transport for employees;

(b) opelets; all forms of para-transit and small freight vehicles; this category of transport represents the informal transport sector in which small and sometimes unlicensed operators provide transport services;

(d) trucks; units with 2 tons carrying capacity or more, with a mix of owner/operator arrangements,

During the 1970s truck traffic has grown at 19% annually, on average; the respective growth trends for passenger car, opelet and bus traffic were 14.5%, 26% and 11%. But there were marked variations in traffic growth and changes in traffic composition along the road, which reflects different levels and trends in urbanization and economic activities. In the section Jakarta-Bekasi overall traffic grew fastest. The relation of total traffic on the Jakarta- Bekasi section to total traffic near Cikampek has dropped from 1:0.59 to 1:0.46 between 1969 and 1980, which indicates the growing importance of local traffic on the road.

4.05 While all categories of traffic on the Jakarta-Cikampek road have grown in absolute terms, the relative mix of traffic has changed considerably during the past decade. As is depicted in Chart 3 there has been a sizeable increase of opelets in the composition of traffic, and the share of passenger cars has dropped by almost 50% between 1969 and 1980. This suggests an obvious shift in the composition of transport demand and signifies compara- tively high subregional increases in lower income population groups. The observed modal split of passenger travel in 1977 suggests that 93% of the trips were made in all forms of public transport, and only 7% in passenger cars. The shares of trucks and buses in total traffic have remained almost unchanged during the 1970s.

4.06 The mixed functions the road has to fulfill and the diversity of traffic which has to be accommodated, including a sizeable percentage of non-motorized traffic, has increasingly been causing operational and capacity problems. These problems are compounded by an often inadequate geometry of the alignment and considerable roadside friction due to intensive residential and commercial land use along the road. Under the project the road layout will be improved, but there are limits to the extent to which such improvements can be made. Substantial pavement widening and alignment relocation could 6nly be done at the cost of major disruptions of residential and commercial land use. Within these constraints, the proposed improvements to the road could establish a maximum practical capacity of about 35,000 passenger car units (PCUs) per day. Considering past and presently observed 32 -

traffic growth trends on the road, this capacity limit would be reached by 1985. Beyond that date further traHfic growth could not be accommodated without imposing increasingly high economic and social cost on the regional economy and population. Such a situation would make further regional development difficult and endanger the achievement of regional development strategies which have been selected (para. 2.11). Another demonstration of the critical condition of the highway are rapidly growing accident rates. Between 1972 and 1979 traffic accidents per 100 million vehicle-km on the road grew from 45 to 98, implying an annual growth rate of about 12%.

C. Traffic Projections

4.07 The proposed toll road will provide the urgently required relief for the regional transport system. Development of this new facility will be in stages, in line with regional traffic growth. Three traffic projections have been prepared for project appraisal, i.e.:

(a) a basic case which shows the number of vehicles on the existing and new roads, with the assumption that the new road will be tolled at rates presently used on the Jagorawi Toll Road (Rp 13/km for vehicles under 2.5 tons, Rp 23/km for all others);

(b) alternative 1 where the new road is entirely free of tolls; and

(c) alternative 2 in which the tolls on private cars, particularly on the most expensive sections of the road (near Jakarta), are sharply increased with a consequent reduction in this traffic while the tolls for public transport vehicles are eliminated.

The basic case incorporates GOI's present position on tolls, alternative 1 the optimum use of the road without revenue considerations, and alternative 2 a toll variant emphasizing private car restraints. By 1990 road traffic in the corridor is expected to have reached the equivalent of about 64,000 PCUs per day. Under the three alternative arrangements of managing the road system in the corridor, the following diversions of traffic from the existing Jakarta-Cikampek road to the new highway have been calculated: (a) basic case, 66%; (b) alternative 1, 87%; arid (c) alternative 2, 67%.

4.08 In the absence of etnpirical data in Indonesia which would have per- mitted establishment of elasticities between the level of tolls and the use of a toll road, assumptions have been made regarding traffic diversions from the existing road to the new highway. Based on these assumptions, 30% less traffic than in the free road case will use the new highway during the first year following project completion '1987), if tolls would be levied. This percentage will gradually decrease to 5% over a period of 15 years as delays and increasing vehicle operating costs will gradually gain importance over - 33 -

the level of tolls in driver decision-making regarding the use of the two road links. Details of the traffic projections for the basic case and the two alternatives are given in Tables 12a, 12b, and 12c. The consultants analysis, which is reflected in the projections of this report, derived the traffic forecast from disagaregated data on developments in the corridor. Certain increments in goods and passenger traffic were projected to occur for each location, and these were converted to vehicle movements by assumptions about modal splits, size of vehicles in use, etc. The methodology is sound and reasonable assumptions were used. The basic case reflects a growth of about 5% annually in both passenger and freight vehicles with a declining trend in later years. In calculating future passenger and commodity movements in the corridor it has been assumed that the railways' share in accommodating transport demand remains unchanged. Also, the modal split between the use of passenger cars and public transport for passenger transport (para. 4.05) has been assumed to remain unchanged.

D. Project Benefits

4.09 To determine the economic viability of the project, only vehicle operating costs and travel time savings were considered as quantifiable benefits. Both parameters were determined for the basic case and the two alternatives for toll levels (para. 4.07). Vehicle operating costs in the corridor without and with the new highway are shown in Table 13. For the calculation of travel time savings, the following averages were assumed (1980 values) /1:

Passenger time value Vehicle type per vehicle hour

Passenger car Rp 1,500 Opelet Rp 720 Bus Rp 2,900

The project will also generate several nonquantifiable benefits such as reduced air and noise pollution, and improved accessibility along the existing Jakarta-Cikampek road. Further, much lower traffic should reduce accidents on the old road, even though higher speeds both on the old and new roads will create some added traffic hazards. During negotiations, GOI agreed to develop a safety program for both these roads as part of its national road safety scheme (para. 1.27) and to put it into effect when the road construction and improvements are completed.

/1 Time costs for opelet and bus passengers are based on an hourly wage for skilled laborers of Rp 500 and for unskilled laborers at Rp 300. - 34 -

E. Economic Analysis

4.10 The economic analysis includes a comparison of the associated costs and benefits for the basic case and alternatives 1 and 2, as defined in para. 4.07. All costs and benefits are net of taxes but include an upward adjustment (shadow price) for petroleum derivatives which are priced in Indonesia below world market rates (para. 1.11). No separate analysis was carried out for improving the existing road alone since this road is about to reach its capacity limit and cannot accommodate the projected traffic growth. The cost streams for the basic case and the two alternatives are essentially the same, except that the first alternative excludes roughly US$ 36 million in investments for toll collection facilities and the costs of operating the toll collection system. The cost stream includes the following:

(a) investments in the new highway;

(b) investments in the existing road;

(d) toll collection costs; and

(e) road maintenance costs.

4.11 For all three scenarios, the economic rates of return (ERRs) of the proposed investments have been determived over a period of 20 years following completion of the works. In addition, the net present values (NPVs) have been calculated by discounting the estimated costs and expected benefits at 10%. ERRs and NPVs have been calculated for each case under a wide variety of assumptions regarding possible changes in estimated project costs and expected project benefits. Under each set of assumptions, the ERRs and NPVs were determined separately with and without travel time savings. The annual cost and benefit streams are shown in Tables 14a, 14b, and 14c. The results of the economic analysis are summarized rinthe table below. The ERRs of the proposed road infrastructure improve-ments in the Jakarta-Cikampek Corridor (basic case) are about 23% if travel time savings are included in the expected benefits, and about 15% without such time savings. Considering vehicle operating cost reductions and time savings as benefits, the proposed investments would still yield a return of 15% if only 50% of the assumed traffic diversion to the toll road would actually materialize. The project would yield an ERR of 10% or more, even if the benefits, calculated without time savings, were reduced by about 45%.

4.12 If road infrastructure imaprovements in the Jakarta-Cikampek Corridor would be arranged in line with alternatives 1 and 2 (para. 4.07) the following ERRs would result: for alternative 1, 24.2% with time savings and 15.7% without time savings, for alternative 2, 23.6% with time savings and 15.1% without time savings. As can be seen, the ERRs for the basic case and the two alternatives are quite similar. If use of the new highway would be free, a steep rate of traffic diversion from the existing road would relatively INDONESIA

JAKARTA-CIKAMPEK CORRIDOR PROJECT

Economic Analysis

With time savings Without time savings Construction Operating ERR NPV /a Construction Operating ERR NPV /a cost cost (%) (Rp mln) cost cost (%) (Rp rfin)

Basic case as estimated as estimated 23.1 211,078 as estimated as estimated 14.9 62,919 (proposed -20% as estimated 26.7 232,530 -20% as estimated 17.6 84,372 tolls) +20% as estimated 20.5 189,625 +20% as estimated 12.9 41,467 as estimated -20% 19.9 147,410 as estimated -20% 12.4 28,883 as estimated +20% 26.0 274,746 as estimated +20% 17.1 96,956 -20% +20% 29.8 296,198 -20% +20% 20.1 118,408 +20% -20% 17.5 125,957 +20% -20% 10.5 7,430

Alter- as estimated as estimated 24.2 227,702 as estimated as estimated 15.7 72,557 native 1 -20% as estimated 27.9 249,155 -20% as estimated 18.5 94,009 (no tolls) +20% as estimated 21.4 206,250 +20% as estimated 13.5 51,104 as estimated -20% 20.9 160,709 as estimated -20% 13.1 36,593 as estimated +20% 27.2 294,695 as estimated +20% 18.0 108,520 -20% +20% 31.3 316,148 -20% +20% 21.1 129,973 +20% -20% 18.4 139,257 +20% -20% 11.1 15,140

Alter- as estimated as estimated 23.6 217,377 as estimated as estimated 15.1 64,977 native 2 -20% as estimated 27.2 238,829 -20% as estimated 17.8 86,430 (alterna- +20% as estimnated 20.9 195,924 +20% as estimated 13.0 43,525 tive as estimated -20% 20.3 152,449 as estimated -20% 12.6 30,529 tolls) as estimated +20% 26.5 282,305 as estimated +20% 17.3 99,425 -20% +20% 30.4 303,757 -20% +20% 20.3 120,377 +20% -20% 17.9 130,997 +20% -20% 10.6 9,077

/a NPV was calculated with a discount rate of 10%. - 36 -

quickly lead to high volume/capacity d,atios on the new highway which would imply increasing travel times and vehicle operating costs. Corresponding gains through reduced traffic volumes on the existing road would not be sufficient enough to offset the decreasing benefits on the new highway. In the case of alternative 2, fewer passenger cars would use the new highway than in the basic case but the number of public transport vehicles would increase because there would be no tolls for buses using the new highway. The effects of both phenomena on benefits would cancel each other out.

F. Financial Aspects

4.13 Based on expected traffic flows on the new toll road, the associated Jasa Marga (para. 1.20) income through toll revenues was calculated. The assumed toll structure and levels correspond to those presently charged for the use of the Jagorawi Toll Road (para. 4.07), annually adjusted by a 10% increase. These assumptions imply a total cumulative income through toll revenues of Rp 1,600 billion (US$2.6 billion) during the first 20 years following the opening of the toll road. The simulated financial performance of Jasa Marga during the period 1982-2005 reveals that enough income will be generated through toll revenues to:

(a) cover the annual costs of operating and maintaining the toll road;

(b) fully amortize (including debt servicing) the investments required to construct the toll road; and

It should be realized that Jasa Marga's expected financial performance was simulated only to establish an understanding about the possible effects on budget requirements of developing, operating and maintaining parts of the regional road transport system. Several parameters in the simulation are hypothetical and would require verification, e.g., traffic volumes on the toll road and the existing road. But the general indication resulting from Jasa Marga's projected cash flow clearly suggests that the project will substantially contribute to GOI's sector policy objective of enhancing user contribution to the costs of developing, operating and maintaining transport infrastructure (para. 1.09), and increasing cost recovery.

G. Project Risks

4.14 The project has been thoroughly prepared; the proposed civil works are based on detailed engineering by competent consultants (paras. 3.03 and - 37 -

3.09). The objectives for improving transport systems management and development planning have been agreed with GOI in principal terms. The only significant risk under the project would refer to the use of the toll road. Decon- gestion on the existing Jakarta-Cikampek road could be achieved only if there would be a considerable traffic diversion to the toll road. Also, the objective of recovering the costs of improving, operating and maintaining road infrastructure within the corridor could be achieved only if sufficient revenues would be collected for using the new toll road. To date only limited experience exits in Indonesia concerning driver/operator decision-making behavior and attitudes in the use of toll roads. So far, tolls have been applied on only one road in Indonesia, the Jagorawi Toll Road (para. 1.23). The nature of traffic on that road is quite different from that expected to use the proposed Jakarta-Cikampek Toll Road; a significant proportion of traffic on the Jagorawi Toll Road is recreational traffic. During negotiations, agreement was reached that GOI will closely monitor the effect of tolls in the use of the proposed toll road. In case traffic diversion from the existing road would be lower than required to ensure efficient utilization of both roads, which would yield a minimum ERR of about 15% of the proposed investment, GOI should undertake to take corrective steps, including adjustmnents in the toll structure and level, and restraint measures for certain categories of traffic on the existing road.

V. AGREEMENTS AND RECOMMENDATIONS

5.01 During negotiations, agreement was reached on the following loan covenants:

(a) GOI will provide funds to cover any shortfalls in the financing plan for the Jakarta-Cikampek Highway Project (para. 3.20);

(b) GOI will employ qualified and experienced consultants acceptable to the Bank, and on terms and conditions satisfactory to the Bank (para. 3.29), and will retain such consultants for construction supervision before notice to proceed is issued to contractors for the road works (para. 3.21);

(c) GOI will take all necessary actions to acquire the land needed for project implementation in accordance with the detailed work program and timetable for these activities (para. 3.22);

(d) GOI will take timely action and keep hardship at a minimum in relocating households and businesses presently located within the required right-of-way for the project roads (para. 3.23);

(e) GOI will enter into an agreement with Jasa Marga for operation and maintenance of the new highway under terms and conditions - 38 -

satisfactory to the Bank, and will cover any shortfalls in financing Jasa Marga's operation and maintenance program for the new highway (para. 3.26);

(f) GOT will cause the project roads to be maintained in accordance with appropriate maintenance programs, and continue to improve the maintenance of other public roads in the corridor, particularly in the kabupatens of Bekasi and Karawang (paras. 3.26 and 3.27);

(g) GOI will prepare a study of the structure and levels of tolls to be proposed for the Jakarta-Cikampek toll road, and submit such study to the Bank for its review (para. 1.24);

(h) GOI will monitor the effect of tolls on the use of the Jakarta- Cikampek toll road, and take corrective steps in case the traffic diversion from the existing highway would be lower than estimated to ensure efficient utilization of the project roads (para. 4.14);

(i) GOI will take steps to ensure that the dimensions and axle loads of vehicles using the new highway would not exceed limits consistent with the standards to which it has been designed (para. 3.28);

(j) GOI will develop a safety program for the project roads as part of its national road safety scheme, and put the program into effect when the road improvements are completed (para. 4.09); and

(k) GOI will prepare and carry out a program, satisfactory to the Bank, for training of Jasa Marga staff (para. 3.11).

5.02 During negotiations, GOI and the Bank reviewed and agreed on the following:

(a) the cost estimates for the project (paras. 3.14-3.18), and the schedule of estimated disbursements (para. 3.32);

(b) the project implementation scheduale and arrangements for progress reporting and for preparation of a project completion report (para. 3.24); and

5.03 The project is suitable for a Bank loan of US$85 million equivalent to the Government of Indonesia for a period of 20 years, including a grace period of 5 years. JIA2ARTA-CIKAM9pEKHICHWAY PROJECT

ReedTo..... t R~...... by.-Rei..

(1. (2) (3) (45 (5) (6) (7) (H) (93 (10) (11) (12) (13) (14) (15) (16) (17) (18) (19) (201) (21.) (22) '73)

Ko r-do Xo good 11 K. .. ph.1t T-1o -erc 1 Reoilolerd Reglot-rd cr201- 06c Ko p- Good H Go Hoo.d4 cderor- A.ph.lt Ko .oph.lt 4 gr- ooC-r1.i.l -hiol.o oc -od -1977 -oorleeilco or I1-1cr 6401 . p... -g.roere Pop.- Toe roo '01 od o ood_rI.. r-odope- O,groOl IHg--l r.edo por Oth-r To-1 eG~e por k. le- ocher oril a~r.1 orllore otryoe--- 1 odo-10 p-r popo-r-doeo -doper 10 p.p.- -d. -d. p- 'TOppo p eoo,,r oc :rIo pperOl-O ,ro.dleo.de.-oooe 1 R.glo--rd rreo r prlV prkH dO pr od Ar- (0011) (o qH eic (o qh alc (o qH letloc oo)ero1ek rT-o,o 6 -ohlole Poplro eod oroo.y1, 01 oooio pploo o rl ed oet od (0q Ho)' 1976 1977 (3/1) (3/2) 1977 (6/1)) (/) 17 (1211) (12/2) ... .oecrleor l-e (15-12+13±14) (1)/2) 41)/H) 1977 1977 (1H/2) (19/2) (1/)(19/H)

*66 Zo46,290 23,454 31,236 0.24 0.4H 4,96) .11. 11.21 7,346 11.16 11,32 3,1035 23:17H 19.039 45,2),2 1.93 9.12 62,76) 214,1.31 2.H68.1 12.65 19.016 C. Joys 34,206 23,558 9,916 0.28 0,42 7,145 0.2) 11.30 H,2301 0.24 0.35 2,141 4.9)8 8 201H4 312W8 2)0 4.94 36,607 2481,353 1.56 10.14 5150 G.J-o 47,922 2-7,1.03 10,71 0.22 W.3,9 7,496 11.16 0.24 9,276 0.19 0.334 2,104 23,796 299,372 45.172 1.67 6.G3 59066 340,543 2112.6 7.HH 31.61 0G590 5,367 1,663 2.111 0.31 1663 2.82 0.31 1.663 2.62 0.1 7,150 10.253 39,206 65,089 212.3 39.14 159,5911 319,634 29.74 63 959 20423 Yogyelker,t 3,169 2,425 ,6 0.52 0.63 7H3 0.25 0.311 .041 0.33 0.40 306 413 3,27 4,546 1.73 5.H1 3.29) 31,66) 1.26 120 42 190

ToldJob 132,1H7 82,107 35,183 H.26 0.43 22,049 0.17 8.27 27,557 0.21 11.34 13.136 60.598 119,608 195.342 2.38 8.H6 321,40.1 1,17,3i..26 3.911 14.30 14.5H 33.38

SWatel 3,561 2,293 2.33608.42 1.02 1,279 11.23 0.56 2,149 0.39 0.94 64H 1.677 5,H34 8,149 3.52 6.37 4,75)6/e 51,800/e 2.07 22.59 3.72 22.17

Aoeh 55,392 2,226 5,0741 0.1.0 2.62 1,863 1.11 11.04 23771 0.04 1.07 1,093 399 2,786 4,278 092 2.30 2,698 35,7401 2.21 16.06 1.45 6.12 N. Sooltre 10,7117 7,467 9,470 0.13 1.27 4,762 0,07 064 5,721 0.08 0.7,7 I1,998 3777 9.021 14,796 1.9 3.11 211004 153,6008.5215 52 62 H.Sclr 996 2,99 4 4,9119 0.09 1.64 2,003 0,0 0.0 3,350 11.07 1.12 6 ,W 4,1114 7,9711 266 3 83 3:,6111 30,419 1,21 10.16 173 6,20 RI.. 94,5" 1,043 2,H99 0.0) 1.57 1:4,45 W 0.70 1,1)3 0.01 11.60 46 1,10 4,632 6,235 3.0 42W 2,112 16,691103 9.15 1.557 J o1.4 ,2 1.103 2,1000 21 .12 .1 .2 1440 0.113 1.31 598 5116 1,9H7 3,141 2.S 2.01 1.5/c 9576811 WH 0.1 3.99 S.g-.ooer l,t6 3,071 7,0881 0.07, 2.06 5,063 0.04 1.511 4,7)23 0.115 1.22 1,9)9 2,709 7,476 1)~4 3.4 2.07 9,H6; 9707- 2,59 13.29 2.53 4a9 Wegoo2,6 67 2,688 0.12 474 968 0.09 0.71 1,4)7 0.117 2.57 154 176 839 1,62.6.1257 3o2; 046.4027.7 Lepo 331 ,3 ,1.00 .7 1,370 0.04 0.40 1,275 0.011 8.46 396 2,293 4,954 7,4 .3 5.8 260; 4 77 1.64 64.2 .6 6.39

7 T-1olS-ctr- 473,606 23,511 30,699 50.0 1,64 19.929 0.04 0.95 21,7 o 8.05 0.93 7Z,581 13,286 3650 57,376 2,44 2.08 4739 304oo 2,02 12.93 2.30 7.90

9. Gelfoe-t- 147,780 2,281 3,38)5 0.2 157 1,29) 0.111 0.70 2,04.4 0.012 0.90 234 666 1,W51 1.931 11,86 1.22 1,32 l7,)69 0.587.0184 .9 G.wGeIoeter 5261 82 0 0.OOH6 1.11 31. 0.002 0.39 232 0.811 11.29 ./A 0/, 0/A N/A N/A l/A N/A 11/4 1 1.7 110.84 )2.04 9.22 0. Kelloeoteo: 37,660 1, 346 3117 0.03 1.1.) 1,4117 0.113 0.60 2,7 .4 1.1 1W 1,0 ,6 ,3 .3 2.) 313 2.21b )I 11 1 2

5.4eoooe02,440 2,866I 1,017 0.005 0.45 57 0.0o.2 0 0.0113 0.31 249 42t393 5,3250 7,9677 4 3.497 13.3) 3,734 18,7016 1.64 0.20 6.25 0.39 To-e eleto~ 586 764 80 .0 3.618 0.0 11.62 1,657 0.1 0,79 631/c .139/c 7,97 /c 12) 0/c 2,1 /c 7.,5/c 8,17 6,09 1,39 ll.10 2,26 W-54

0. Seleo-o 19,023 1,099 3,657 0.40 1.94 1,603 0.119 11.89 1,462 80 0 0.77 1,476 1,307 4,084 6,791 3.18 4.03 1,4!./6 10,283/e 11.74 2.39 0 W4 2.85 I. SolIceo 69,726 1,014 4,7511 11.07 4.68 2,078 11.13 2.05 1,727 0.02 1.78 300 489 1,739 2,458 2.42 1.1 7/o 9 6887/e 0.62 9.5) 0.30 2,114 S. Seleocot 72,701 )681 7,443 010:1 1.,31 4,097 8.06 8.72 3,758 0.5 1.66 1,16) 390 9:,384 10,936 1.3 26 Va7,3 1 9,8 33 5118 1 .6 .179 I.E. Solosl 2,66 75-,20 00 3.21 967 0.03 1.23 762 0.3 W958 0 101 1.09 1.939 3.1. 79) 587

Goeeloo 189,216 9,379 18.370 0,10 1.96 8.825 0.11 11.94 7,7111 0,1 0.82 2,6 2,116 16,192 21.,274~ 2.27 2.42 9,476 109,03 1,01 1.11.63 1.07 2.94

W. N... t0egg-r 211,177 2,401 2,627 8.13 1.09 1,267 0.06 0.53 1,565 0.115 0.65 232 2011 2,215 2,647 1,10 1.95 1.,233/. 8,967/e 0.51 3.73 0.97 3,41

EK Noet.. or 47,876 2,46) 7,629 0.16 3.10 2,199 0.05 0.89 2,177 0.111 0.88 820 537 1,39) 3,052 0.24 1.39 1..50l/e 4,71~1/ 0.61 1.91 0.60 0.62

Msloko 74,505 1,2118 2,M0) 0,0~2 1.43 629 0.01. 0.511 560 0.111 0.45 301 90 936 1,335 1.06 2.12 1,929 7,734 1.53 6,15 3.117 4.29

lrleo J.Oyo 421,901. 1,008 1,250 0.003 1.13 2)4 11.0111 0.25 333 0.001 0.33 263 945 927 2.1.35 2,1.2 4.06 3,009 7,609 3.78 7.55 13.111 6.69

Tota Iod-oeol 1,0,6 13028 11,0 0.06 .8.9 6On6 8.03 0.46 67,723 0.04 0.52 2858 8389 20,2 312799 2.40 5.20 399.681 1,733,276 3.07 13.301 6.65 15.04

/e 1976 do.- 7-b Ioclodee C. Xel eo o 7; Eloolde C. Kelioaoteo

9W0- .oedoeo-lode ko-e dyecoodo.

ooPrbbos,iere..Dpr Aole o P.eoopeeocleio I k-to P-rhebooe- D.. P- .... it.. (P0...4, 2974 S/D11.977), Boke Toble 6.1.6; Ge-t-e S-te.r.ole OtfO . S Y8lIeYeb.ok of lodo..oote, 1977, Table X 111.2.3, ood Beot-co iot Report~, 1odoc..ole, Repor No. 2093-1Ill, Tbhle 1.1.

Apr11 1981 - 40 -

Table 2

INDONESIA

JAKARTA-CIKAMPEK HIGHWAY PROJECT

National Government Development Budgets by Output Category, 1978/79 and 1979/80 (Current prices Rp x 1O0)

1978/79 1979/80

Agriculture and Irrigation 577.0 419.4 Agriculture 127.5 157.5 Irrigation 285.6 261.9 Industry 163.9 401.9 Mining and Energy 323.8 392.9 Mining 57.6 36.4 Energy 266.2 356.5 Communications and Tourism 388.6 512.2 Roads } 272.8 Land communications } 58.4 Sea communications } 384.3 113.6 Air communications * 52.7 Post and telecommunications } 6.4 Tourism 4.3 8.3 Trade and Cooperatives 11.2 25.5 Trade 7.0 7.1 Cooperatives 4.2 18.4 Labor and Transmigration 121.9 165.6 Labor 13.3 19.4 Transmigration 108.6 146.2 Regions, Villages and Cities 271.1 330.1 Religion 9.5 19.0 Youth, Culture and God 269.1 356.1 General education and youth 237.8 316.7 Special education 19.9 25.5 National culture and God 11.4 13.9 Health, Social Welfare, Women and Family Planning 87.2 132.9 Health 63.1 90.1 Social welfare 16.9 17.2 Population planning 7.2 25.6 Peoples' Housing and Settlement 59.5 77.9 Peoples' housing 25.4 - Water supply and sanitation 34.1 - Judiciary 14.1 30.6 Defense and Security 115.6 254.3 Information and Press 11.8 17.4 Science, Technology and Research 46.9 58.2 Science and technology 11.9 $.0 Research and statistics 35.0 53.2 Government's Apparatus 65.2 103.5 Total 2,454.7 3,297.0

Source: Nota Keuangan Tahun.

April 1981 - 41 - Table 3

INDONESIA

JAKARTA-CIKAI4PEK HIGHWAY PROJECT

Gross Domestic Product by Industrial Origin (1976)

Greater Jakarta Sector Indonesia Jakarta metropolitan region ----- (Rp billion) ------

Transportation 663 100 114

Agriculture 4,812 28 369

Mining and quarrying 2,930 6 10

Manufacturing 1,453 167 232

Construction 813 58 76

Utilities 98 22 23

Trade 2,871 187 253

Finance 207 81 84

Government 1,074 115 124

Services, ex. GOI. 574 109 137

Total 15,495 873 1,422

Source: Jabotabek Metropolitan Development Plan, 1980.

April 1981 - 42 - Table 4

INDONESIA

JAKARTA-CIKAMPEK HIGHWAY PROJECT

Comparison of Regional Allocations under Repelita III and Proposed Development Projects in the Greater Jakarta Region (1979 Prices)

Sector Project Description Cost (Rp x 109)

1. TRANSPORTATION 2,720.7 Roads, railways, buses 336.9 Tollways 1,977.5 International Airport 406.3 2. WATER SUPPLY 79.3 Jakarta Water Supply Stage 1 42.0 Tangerang Water Supply - Masterplan (two stages) 37.3 3. SANITATION AND SEWERAGE 151.0 Jakarta Sanitary & Sewerage Program First Stage 75.5 Sanitation/Sewerage 59.1 Storm Water Drainage 7.6 Sanitation Facilities 5.3 Operation and Management 3.5 Bogor Sewerage Masterplan 15.0 4. GREATER JAKARTA FLOOD CONTROL 318.8 E., W. Banjir Canal.s 119.0 Cengkareng Drain 15.4 Cakung Micro Drain 6.3 Polders (Marunda, Sunter, Pademangan) 49.9 Cengkareng 12.0 Karang Drain 25.0 Cleaning Existing Drains 5.1 Others 87.0 5. ELECTRICITY 94.5 6. WATER RESOURCES 536.0 Storage and Irrigation Works; CJC Recommended Projects 536.0 7. HOUSING & RELATED 45.4 Kampung Improvement Program 32.1 Solid Waste Management 12.6 Health Posts & Training 0.7 Total 3,945.7 Allocation under Repelita III 2,543.0 Resource gap 1,402.7

Source: Cipta Karya. April 1981 - 43 - Table 5

INDONESIA

JAKARTA-CIKAMPEK HIGHWAY PROJECT

Government Agencies Involved in Transport in Jakarta and Surrounding Kabupatens

Agency Responsibilities

Central Government BAPPENAS National economic planning. Resource allocation. Development of five-year plans. Ministry of Communications - Land Transport Regulation of bus, rail, ferry, river/lake transport. National transport planning. Fare policies. - PJKA Planning and operation of national rail services. Ministry of Public Works - DGH National and provincial highway planning, design, construction and maintenance. Major urban road planning. - Cipta Karya Housing, building and urban and regional development planning., Technical assistance to local governments. - P.T. Jasa Marga Constructon, maintenance and operation of national tollroads. Regional Agencies Jabotabek Advisory responsibility for Jabotabek regional planning. Local Government DKI Jakarta - BAPPEDA Economic planning agency for Jakarta. Budgetary coordination. - Dinas Tata Kota Physical planning for Jakarta. Land use and street development planning. Review and implementation of the Master Plan. - DLLAJR Traffic engineering and management, regulation of bus operation, vehicle inspection and enforcement of vehicle weight restrictions. - PN PPD Operation of city bus services (with routes regu- lated by DLLAJR and fares by Dit. Jen. Land Transport) along with private bus companies. - Traffic Police Dept. Vehicle registration, driver licensing, traffic control, accidents and statistics. - Public Wiorks Dept. Design and construction of public works, including some road works. - Kampung Improvement Includes street and footpath improvements in low- Programme cost kampung upgrading projects. West Java BAPPEDA Economic planning and budgeting for West Java province.

April 1981 INDONESIA

JAKARTA-CIKAM4PEK HIGHWAY PROJECT

Estimated Regional Roae Freight Flows, 1978 ('000 tons p.a.)

Jakarta Jakarta- Jakarta- Jakarta- Total Destination: (excl. Total Tangerang Bogor Cikampek external Grand Origin port) Port Jakarta corridor corridor corridor zones total

Jakarta (excl. port) 10,000 484 10,484 1,279 3,764 2,026 7,069 17,553

Port 3,052 - 3,052 218 642 346 1,206 4,258/b

Total Jakarta 13,052 484 13,536 1,497 4,406 2,372 8,275 21,811

Jakarta-Tangerang corridor 1,414 52 1,466 - 56 34 90 1,556

Jakarta-Bogor corridor 7,388 274 7,662 204 - 22 226 7,888

Jakarta-Cikampek corridor 5,084 189 5,273 30 18 - 48 5,321

Total External Zones 13,886 515 14,401 234 74 56 364 14,765

GRAND TOTAL 26,938 999/a 27,937 1,731 4,480 2,428 8,639 36,576

/a Total port exports (1.234 million tons) less 60% of total incoming movements by rail.

/, Total port imports (4.906 million tons) less 90% of total outgoing movements by rail.

Source: Jabotabek Metropolitan Development Plan, 1980.

April 1981. INDONESIA

JAKARTA-CIKANPEK IGHW4AY PROJECT

DGH Geometric Design Standards /a

Primary Highways Secondary 11ighways Feeder Roads I II-A lI-B II-C III Moun- Houn- Moun- Moun- Moun- Terrain Flat Rolling tainotus Flat Rolling tainous Flat Rolling tainous Flat Rollinig tainous Flat Rolling tainotus

Average daily traffic (ADT) in passenger car units 20,000 6,000-20,000 1,500-8,000 <2,000 <1,000

Design speed (km/h) 120 100 80 100 80 60 80 60 40 60 40 30 60 40 30

Minimum right-of-way (m) 60 60 60 40 40 40 30 30 30 30 30 30 20 20 20

Pavement width (m) Minimutm 4 x 3.75 2 x 3.50 or 4 x 3.50 2 x 3.50 2 x 3.00 3 .50-6.00/c Minim,im median width (m) 10 1.5/b - -4

Shoulder width (m) 3.50 3.00 3.00 3.00 2.50 2.50 3.00 2.50 2.50 2.50 1.50 1.00 1.50- 2 .50/c

Paveimienitcross slape 2% 2% 2% 3% 4%

Shoulder cross slope 4% 4% 6% 6% 6%

Surfacing Asphaltic Concrete (AC) AC /d /d /d (hot mix)

Maximnum superelevation 10% 10% 10% 10% 10%

Minimum horizontal radius (m) 560 350 210 350 210 .115 210 115 50 115 50 30 115 50 30

Maximum grade 3% 5% 6% 4% 6% 7X 5% 7% 8% 6% 8% 10% 6% 8% 12%

/a Pavement struicture is designed in accordance with DGH's "A Guide for Pavement Design (Flexible)," 1974, No. 04/PO/BM, and for a design life of about ten years, unless another design life would be warranted. Bridges are designed in accordance with DGH's "Standard Loading Specification for Highway Bridges," 12/1970. /b Only for 4-lane highways. /c According to condition. Td Surfacing selected can vary from single bituminous surface treatment to asphaltic concrete on the basis of economic considerations. Generally roads with the above design stanidards can be varied flexibly to suit special conditions of traffic, land use or terrain.

Source: Directorate General of H1ighways, SLandard Document No. 13/1970. |

April 1981 Table 8 - 46 - INDONESIA

JAKARTA-CIKAMPEK HIGHWAY PROJECT

Project Costs

For- For- Foreign Local eign Total Local eign Total exchange Project component --- (Rp billion) - - (US$ million) - component

I. Civil Works A. Jakarta-Cikampek Toll Road (New Construction) 1. Section A, Jakarta-Cibitung, 24.5 km 23.6 35.4 59.0 37.8 56.6 94.4 60 2. Section B, Cibitung-Karawang West, 23.0 km 12.8 19.0 31.8 20.4 30.5 50.9 60 3. Section C, Karawang West-Cikampek, 24.5 km 11.1 16.8 27.9 17.8 26.8 44.6 60 Subtotal A 47.5 71.2 118.7 76.0 113.9 189.9 60 B. Jakarta-Cikampek Existing Road (Improvements) 1. Section Bekasi-Cikampek, 63.0 km 3.6 5.4 9.0 5.8 8.6 14.4 60 Total I 51.1 76.6 127.7 81.8 122.5 204.3 60 II. Consulting Services 1. Supervision of IAl (6% of construction) 1.8 1.8 3.6 2.9 2.9 5.8 50 2. Supervision of IA2 (6X of construction) 1.0 0.9 1.9 1.5 1.5 3.0 50 3. Supervision of IA3 (6Z of construction) 0.8 0.9 1.7 1.4 1.4 2.8 50 Subtotal 1-3 3.6 3.6 7.2 5.8 5.8 11.6 50 4. Supervision of IBI (8% of construction) 0.4 0.3 0.7 0.5 0.6 1.1 50 5. Toll road management assistance 0.1 0.4 0.5 0.2 0.6 0.8 80 6. Jabotabek regional transport studies 0.1 0.4 0.5 0.2 0.6 0.8 80 Total II 4.2 4.7 8.9 6.7 7.6 14.3 (53) Total I + II 55.3 81.3 136.6 88.5 130.1 218.6 60 III. Contingencies A. Physical (10X on all items) 1. For IA1, Section A, Jakarta-Cibitung 2.4 3.5 5.9 3.8 5.6 9.4 60 2. For IA2, Section B, Cibitung-Karawang West 1.3 1.9 3.2 2.0 3.1 5.1 60 3. For IA3, Section C, Karawang West-Cikampek 1.1 1.7 2.8 1.8 2.7 4.5 60 Subtotal 1-3 4.8 7.1 11.9 7.6 11.4 19.0 60 4. For IBI, existing road 0.4 0.5 0.9 0.6 0.8 1.4 60 5. For II, consulting services 0.4 0.5 0.9 0.7 0.8 1.5 53 Subtotal A 5.6 8.1 13.7 8.9 13.0 21.9 60 B. Price (35% in average on Total I + II + IIIA) 1. For IA1, Section A, Jakarta-Cibitung 12.3 10.6 22.9 19.7 16.9 36.6 46 2. For IA2, Section B, Cibitung-Karawang West 6.6 5.7 12.3 10.6 9.1 19.7 46 3. For IA3, Section C, Karawang West-Cikampek 5.8 5.0 10.8 9.3 8.0 17.3 46 Subtotal 1-3 24.7 21.3 46.0 39.6 34.0 73.6 46 4. For IB1, existing road 1.5 1.3 2.8 2.4 2.1 4.5 47 5. For I1l, 2, 3 supervision (new road) 2.1 1.2 3.3 3.3 1.9 5.2 37 6. For II4, supervision (existing road) 0.1 0.1 0.2 0.2 0.1 0.3 33 7. For II5, toll road management assistance 0.1 0.0 0.1 0.1 0.1 0.2 50 8. For II6, Jabotabek regional transport studies 0.0 0.1 0.1 0.1 0.1 0.2 50 Subtotal B 28.5 24.0 52.5 45.7 38.3 84.0 46

Total III 34.1 32.1 66.2 54.6 51.3 105.9 46 Total I + II + III 89.4 113.4 202.8 143.1 181.4 324.5 56 IV. Land Acquisition and Property Compensation A. Jakarta-Cikampek Toll Road 1. Section A, Jakarta-Cibitung 6.4 0.0 6.4 10.2 0.0 10.2 0 2. Section B, Cibitung-Karawang West 3.1 0.0 3.1 5.0 0.0 5.0 0 3. Section C, Karawang West-Cikampek 3.8 0.0 3.8 6.1 0.0 6.1 0 Subtotal A 13.3 0.0 13.3 21.3 0.0 21.3 0 B. Jakarta-Cikampek Existing Road 1. Section Bekasi-Cikampek 0.2 0.0 0.2 0.3 0.0 0.3 0

Subtotal A + B 13.5 0.0 13.5 21.6 0.0 21.6 0 C. Relocation of Housing and Businesses 4.2 0.5 4.7 6.7 0.8 7.5 10 D. Cadastral Surveys & Contingencies (10%) 1.8 0.0 1.8 2.8 0.1 2.9 4 Total IV 19.5 0.5 20.0 31.1 0.9 32.0 3 Total Cost of Project (I-IV) 108.9 113.9 222.8 174.2 182.3 356.5 51

Notes: 1. June 1981 price level. 2. Rp costs which relate to US$ costs may not correspond exactly due to rounding of numbers. 47 Ta ble 9

INDONESIA

JAKARTA-CIKANPEK HIGHWAY PROJECT

Project Implementation Schedule

Inmplementation Project item Start Complete

I. Civil Works A. Construction of Jakarta-Cikampek Toll Road and the Improvements on the Existirg Road from Bekasi to Cikampek 1. Prequalification of contractors 01/01/81 08/31/81 2. Tendering 10/01/81 01/31/82 3. Receive and open bids, bid evaluation, Bank co,-1currence, and award of contracts 02/01/82 06/15/82 4. Construction a. Section A of Toll Road Subsection Jakarta-Bekasi West 08/01/82 12/31/85 Subsection Bekasi West-Cibitung 08/01/82 12/31/86 b. Sections B and C of toll road 08/01/82 06/30/87 c. Section Bekasi-Cikampek of existing road 08/01/82 12/31/85

II. Consulting Services /a A. Supervision of toll road 07/01/82 07/31/87 B. Supervision of existing road 07/01/82 01/31/86 C. Toll road management assistance 07/01/82 06/30/84 D. Regional transport studies 07/01/82 06/30/84

/a Appointment of new consultants is preceded by standard series of steps as follows: Days

1. Receive proposals 42 2. Evaluate proposals and report 21 3. Approval of DGH or MOC procurement committee and IBRD concurrence 30 4. Invite consultants for negotiations 10 5. Complete contract negotiations and prepare initialed draft contract 14 6. Approval of government agencies and IBRD concurrence 28 7. Arrangements for and signing contract 7 8. Issuance of notice to proceed 4 9. Consultants mobilization 42

Total 198

If consulting services will be provided by extension of an existing contract, steps 1-4 and 9 are either deleted or considerably shortened.

April 1981 - 48 -

Table 10

INDONESIA

JAKARTA-CIKAMPEK HIGHWAY PROJECT

Schedule of Estimated Disbursements

Cumulative disbursements at IBRD fiscal year end of quarter and quarter (US$ million)

1981/82 March 31, 1982 0 June 30, 1982 0.9 1982/83 September 30, 1982 1.9 December 31, 1982 3.3 March 31, 1983 5.2 June 30, 1983 7.9 1983/84 September 30, 1983 11.6 December 31, 1983 16.5 March 31, 1984 22.5 June 30, 1984 28.2 1984/85 September 30, 1984 34.0 December 31, 1984 39.7 March 31, 1985 45.5 June 30, 1985 51.2 1985/86 September 30, 1985 57.0 December 31, 1985 63.0 March 31, 1986 68.4 June 30, 1986 73.0 1986/87 September 30, 1986 77.2 December 31, 1986 80.5 March 31, 1987 83.1 June 30, 1987 84.1 1987/88 September 30, 1987 85.0

Closing Date: December 31, 1987

Source: Government/Bank estimate. April 1981 INDONESIA

JAKARTA-CIKAMPEK HIGUWAY PROJECT

Traffic Volume Counts and Observed Traffic Composition

Year of Traffic Count 1969 1 1974 1 1977 1 1980 Velicle Category PC 0 B TI PC 0 B I PC 0 B T I PC 0 B T

Section I I

1. Jakarta-Bekasi I I I4 Total 3,327 1 8,732 1 16,810 1 23,375 By category 765 469 554 1,539 11,641 1,814 858 4,419 13,028 4,378 1,205 8,199 13,388 5,872 1,933 12,542 Composition (%) 23 14 17 46 1 19 21 10 50 1 18 26 7 49 1 14 25 8 53

2. Bekasi-Cibitung

Total 2,682 1 6,099 1 10,952 1 15,895 By category 847 313 201 1,321 11,409 864 650 3,176 11,573 2,159 990 6,230 11,952 3,994 1,756 8,193 Composition (%) 32 11 7 50 1 23 14 11 52 1 14 20 9 57 1 12 25 11 52

3. Cibitung-Karawang I I

Total 1,965 1 4,957 1 8,953 1 12,717 By category 732 140 214 879 11,030 419 933 2,575 11,488 1,401 988 5,076 11,283 3,260 1,950 6,224 Composition(%) 37 7 11 451 21 8 19 52 1 17 16 11 57 1 10 25 15 49

4. Karawang-Cikampek

Total 19662 1 4,416 1 6,835 1 10,832 By category 705 274 172 815 11,193 679 618 1,926 11,524 1,245 793 3,273 11,377 3,455 1,595 4,405 Composition(%) 36 14 9 41 1 27 15 14 44 1 22 18 12 48 1 13 32 15 40

Note: PC = Passenger car, 0 = Opelet, B = Bus, T Truck.

Source: Arge Indoc.

April 1981 INDONESIA

JAKARTA-CIKAMPEK HIGHWAY PROJECT

Traffic Forecasts With Proposed Tolls

Type of vehicles on old and new Townships along old road Year road Jakarta Bekasi Cikarang Karawang Cikampek Comments

1977 Cars Old - 3,028 1,573 1,488 1,524 Opelets Old 4,378 2,159 1,401 1,245 Trucks Old 8,199 6,230 5,076 3,273 Buses Old 1,205 990 988 793 PCU Old 30,314 21,287 17,555 12,538

1980 Cars Old 3,388 1,952 1,283 1,377 Opelets Old 5,872 3,994 3,260 3,455 Trucks Old 12,542 8,193 6,224 4,405 Buses Old 1,933 1,756 1,957 1,595 PCIJ Old 44,481 29,941 24,017 19,035

Interchanges and distance between in km Outer Jakarta Jakarta Ring Bekasi Bekasi Karawang Karawang Cikampek Bypass East Road West East Cibitung Cikarang West East South 4.5 4.0 4.9 3.0 8.2 6.6 15.9 7.6 18.1

1985 Cars Old 1,621 1,621 1,621 1,900 1,250 1,535 1,365 1,203 997 About 30% of new road traffic New 6,268 6,533 2,298 1,715 1,609 1,497 1,421 1,379 1,341 rediverted back to old road Opelets Old 3,344 3,354 3,344 4,082 2,587 3,281 2,889 2,542 2,069 (as compared to free road). New 5,777 5,816 3,114 2,324 2,172 2,028 1,970 1,881 1,817 Trucks Old 6,357 6,367 6,357 5,739 4,234 5,361 3,949 2,498 2,456 New 14,1i8 14,636 10,456 7,798 7,216 6,563 5,671 5,103 4,779 Buses Old 834 834 834 999 640 764 685 604 540 New 2,578 2,592 1,557 1,162 1,096 1,014 963 924 909 PCU Old 22,526 22,526 22,526 22,328 15,702 19,747 15,497 11,198 10,286 New 52,496 54,143 34,666 25,858 24,013 21,961 19,495 17,866 16,924

1990 Cars Old 1,862 1,862 1,R62 2,638 1,668 1,696 1,623 1,448 1,302 About 15% of new road traffic New 10,107 1!0,511 4,116 3,678 3,653 3,639 3,321 3,069 2,984 rediverted back to old road Opelets Old 3,181 3,181 3,181 4,307 2,518 2,576 2,480 2,204 1,948 (as compared to free road). New 6,971 7,015 4,043 3,595 3,578 3,556 3,271 3,000 2,916 Trucks Old 6,049 6,049 6,049 5,681 4,616 6,066 3,833 2,935 2,541 New 21,563 22,315 16,376 12,387 12,305 12,226 11,013 8,298 7,268 Buses Old 1,094 1,094 1,094 1,344 895 906 865 773 689 New 4,288 4,310 2,695 2,397 2,384 2,371 2,224 2,000 1,944 PCU Old 22,354 22,354 22,354 23,836 17,516 21,249 15,416 12,536 10,981 New 79,562 81,934 54,489 43,035 42,762 42,502 38,573 30,814 27,958

2000 Cars Old 3,724 3,724 3,724 4,500 1,704 1,655 1,740 1,496 1,319 About 5% of new road traffic New 20,213 21,021 8,231 7,810 7,794 7,764 7,107 6,449 6,189 rediverted back to old road Opelets Old 2,099 2,099 2,099 2,590 959 930 978 834 739 (as compared to free road). New 4,600 4,629 2,667 2,588 2,579 2,573 2,355 2,137 2,050 Trucks Old 8,953 8,953 8,953 8,404 4,275 4,787 3,276 4,873 2,169 New 31,910 33,023 24,234 19,160 18,920 18,792 17,939 14,865 12,849 Buses Old 2,209 2,209 2,209 2,490 943 916 963 829 731 New 8,661 8,705 5,443 5,199 5,188 5,168 4,731 4,294 4,120 PCU Old 32,624 32,624 32,624 33,080 15,237 16,385 12,834 16,171 8,943 New 121,910 125,610 82,369 68,696 68,049 67,65-3 63,772 54,337 48,602

Note: Passenger Car Unit (PCU) values: Cars and Opelets, 1.0; Trucks, 2.5; Buses, 2.0.

Source: Arge INDOC. April 1981 X INDONESIA

JAKARTA-CIKAMPEK HIGHWAY PROJECT

Traffic Forecasts With No Tolls

Type of vehicles Townships along old road on old and new Cikarang Karawang Cikampek Comments Year road Jakarta Bekasi

1,573 1,488 1,524 1977 Cars Old 3,028 2,159 1,401 1,245 Opelets Old 4,378 6,230 5,076 3,273 Trucks Old 8,199 990 988 793 Buses Old 1,205 21,287 17,555 12,538 PCU Old 30,314 1,952 1,283 1,377 1980 Cars Old 3,388 3,994 3,260 3,455 Opelets Old 5,872 8,193 6,224 4,405 Trucks Old - 12,542 1,756 1,957 1,595 Buses Old 1,933 29,941 24,017 19,035 PCU Old 44,481 Interchanges and distance between in km Outer Karawang Cikampek Ring Bekasi Bekasi Karawang Jakarta Jakarta East South Road West East Cibitung Cikarang West Bypass East 7.6 18.1 4.5 4.0 4.9 3.0 8.2 6.6 15.9 798 628 543 337 Old 463 460 490 1,056 406 1 1985 Cars 2,234 2,081 2,001 1,945 New 7,426 7,694 3,429 2,559 2,364 U, 2,283 1,891 1,648 1,175 Opelets Old 2,277 Z,310 1,811 2,938 1,443 H 3,026 2,819 2,711 2,634 New 6,844 6,850 4,647 3,468 3,203 2,130 718 146 104 Old 3,749 3,756 1,209 1,900 395 Trucks 9,794 9,125 7,131 6,931 New 16,726 17,237 15,604 11,637 10,750 265 186 157 93 Old 358 373 68 427 68 Buses 1,513 1,409 1,356 1,318 New 3,054 3,053 2,323 1,734 1,602 8,936 4,686 2,870 1,958 PCU Old 12,829 12,906 5,460 9,598 2,973 32,771 30,531 25,252 24,543 New 62,193 63,743 51,732 38,588 35,646 815 717 571 887 886 881 1,757 792 829 1990 Cars Old 4,198 3,800 3,695 New 11,082 11,487 5,097 4,554 4,536 4,506 1,729 1,691 1,489 1,233 Opelets Old 2,509 2,530 2,218 3,446 1,661 4,403 4,102 3,715 3,611 New 7,643 7,666 5,006 4,452 4,431 3,153 1,308 958 564 Old 3,970 3,977 2,147 2,616 1,665 Trucks 13,125 10,275 9,000 New -23,642 24,633 20,278 15,338 15,228 15,139 341 339 297 213 Old 681 694 452 770 324 Buses 2,936 2,735 2,476 2,407 New 4,701 4,710 3,337 2,968 2,953 11,123 6,454 5,195 3,640 Old 14,683 14,747 9,371 13,283 7,264 PCU 52,629 46,583 38,155 34,620 New 87,232 89,541 67,472 53,287 52,943 1,247 1,366 1,157 980 Cars Old 3,291 3,295 3,291 3,982 1,293 2000 8,172 7,481 6,788 6,514 New 20,646 21,450 8,664 8,221 8,196 781 840 717 619 Old 2,001 2,005 1,959 2,353 807 Opelets 2,708 2,478 2,249 2,157 New 4,698 4,723 2,807 2,724 2,713 3,799 2,333 4,091 1,387 Trucks Old 8,270 8,280 7,680 7,370 3,268 19,780 18,882 15,647 13,524 New 32,593 33,696 25,507 20,167 19,986 670 645 715 603 505 Buses Old 2,024 2,032 1,923 2,215 5,439 4,979 4,520 4,336 New 8,846 8,882 5,729 5,472 5,454 9,469 13,308 6,077 Old 30,015 30,064 28,296 29,190 11,610 12,816 PCU 67,122 57,195 51,153 New 124,519 128,177 86,697 72,307 71,782 71,208

3 2.5; Buses, 2.0. Note: Passenger Car Unit *(PCU) values: Cars and Opelets, 1.0; Trucks,

Source: Arge INDOC. e April 1981 C. INDONESIA

JAKARTA-CIlCAMPEK HIGHWAY PROJECT /a Traffic Forecasts With Alternative Tolls

Type of vehicles Townships along old road on old and new Cikaapek Comments Bekasi Cikarang Karawang Year road Jakarta

1,573 1,488 1,524 1977 Cars Old 3,028 2,159 1,401 1,245 Old 4,378 Opelets 6,230 5,076 3,273 Trucks Old 8,199 990 988 793 Buses Old 1,205 21,287 17,555 12,538 PCU Old 30,314 1,952 1,283 1,377 1980 Cars Old 3,388 3,994 3,260 3,455 Opelets Old 5,872 8,193 6,224 4,405 Trucks Old 12,542 1,756 1,957 1,595 Buses Old 1,933 29,941 24,017 19,035 PCU Old 44,481 Interchanges and distance between in km Outer Karawang Karawang Cikaapek Jakarta Jakarta Ring Bekasi Bekasi Cikarang West East South Bypass East Road West East Cibitung 6.6 15.9 7.6 18.1 4.5 4.0 4.9 3.0 8.2 1,198 For cars on new road, 30% will redivert 2,414 1,764 1,759 1,589 1,404 1985 Cars Old 2,310 2,313 2,310 back to existing road froa Jakarta 1,295 1,272 1,205 1,139 1,106 New 5,578 5,840 1,608 1,300 to Cibitung and 15% from Cibitung to 2,587 3,281 2,889 2,542 2,069 Old 3,344 3,354 3,344 4,082 Cikampek as compa-ed to toll road with L Opelets 2,028 1,970 1,881 1,817 5,777 5,816 3,114 2,324 2,172 (Table 16a). New 3,949 2,498 2,456 proposed tolls 6,367 6,357 5,739 4,234 5,361 Trucks Old 6,357 5,103 4,779 10,456 7,798 7,216 6,563 5,671 New 14,118 14,636 93 427 68 265 186 157 Buses Old 358 373 68 1,602 1,513 1,409 1,356 1,318 New 3,054 3,053 2,323 1,734 15,072 18,973 14,723 10,505 9,593 Old 22,263 22,331 21,683 21,698 PCU] 22,734 20,171 18,490 17,507 New 52,758 54,352 35,508 26,587 24,7l] redivert 1,754 1,608 For cars on new -road, 20% will 2,685 3,370 2,403 2,059 1,962 1990 Cars Old 2,680 2,682 2,685 back to existing road from Jalkarta 2,942 3,063 3,275 3,051 2,762 New 9,288 9,691 3,292 Cibitung and 10% from Cibitung to 2,576 2,4890 2,204 1,948 to 3,181 3,181 3,181 4,307 2,518 Cikampek as compared to toll road with Opelets Old 3,556 3,271 3,000 2,916 6,971 7,015 4,403 3,595 3,578 (Table 16a). New 3,833 2,935 2,541 proposed tolls 6,049 6,049 5,681 4,616 6,066 Trucks Old 6,049 8,298 7,268 16,376 12,387 12,305 12,226 11,013 New 21,563 22,315 213 770 324 341 339 297 Buses Old 681 694 452 2,953 2,936 2,735 2,476 2,407 New 4,701 4,710 3,332 2,968 20,482 14,703 11,890 10,335 Old 22,234 22,374 21,893 23,420 17,109 PCU 43,268 39,325 31,459 28,585 New 79,569 81,914 54,949 43,441 43,310 road, 10% will redivert 2,095 1,818 1,641 For cars on new 4,543 4,547 5,486 2,485 2,043 Jakarta 2000 Cars Old 4,552 6,126 5,879 back to existing road from 7,407 7,029 7,029 7,375 6,751 New 19,384 20,201 739 to Cibitung and 5% from Cibitung to 2,590 959 930 978 834 Opelets -Old 2,099 2,099 2,099 Cikampek as compared to toll road with 2,579 2,573 2,355 2,137 2,050 New 4,600 4,629 2,667 2,588 proposed tolls (Table 16a). 4,275 4,787 3,276 4,873 2,169 Old- 8,953 ,8953 8,953 8,404 Trucks 18,792 17,939 14,865 12,849 New 31,910 33,023 24,234 19,160 18,920 670 645 715 603 505 Buses Old 2,024 2,032 1,923 2,215 5,439 4,979 4,520 4,336 r'aw 8,846 8,882 5,729 5,472 5,454 16,231 12,693 16,041 8,813 Old 33,082 33,089 32,875 33,516 15,472 PCU] 67,806 63,912 54,466 48,724 New 121,451 125,152 82,117 68,461 67,816

/a Alternativ,e Tolls: Cars: 100% surcharge from Jakarta Bypass to Cibitung. 50% surcharge from Cibit,,ng to Cikampek South. Opelets, Trucks: No change Buses : Free

1.0; Trucks, 2.5; Buses, 2.0. Note: Passenger Car Unit (PCI])values: Cars and Opelets,

Source: Arge INDOC. April 1981 - 53 -

Table 13

INDONESIA

JAKARTA-CIKAMPEK HIGHWAY PROJECT

Vehicle Operating Costs

Average economic vehicle operating cost in 1980 prices per 1,000 km in Rp in the corridor without the new highway in 1985.

Cost Passenger Medium Heavy component car Opelet Pick-up truck truck Bus

Fuel 12,114 17,465 13,571 29,297 31,983 31,570 Engine oil 513 718 860 1,350 2,770 2,003 Tires 589 757 703 1,932 2,082 2,072 Maint. repair 6,009 4,540 4,555 22,346 26,131 45,183 Depreciation 22,279 8,024 14,375 19,096 32,500 41,756 Interest 20,289 7,695 13,774 18,317 30,803 33,054 Overhead - 5,636 5,495 9,984 14,489 22,204

Total 61,791 44,835 53,333 102,322 140,758 177,842

Average economic vehicle operating cost in 1980 prices per 1,000 km in Rp in the corridor with the new highway in 1985. (After opening of Section A)

Cost Passenger Medium Heavy component car Opelet Pick-up truck truck Bus

Fuel 12,977 18,358 14,537 34,888 37,811 38,863 Engine oil 487 668 775 1,110 2,138 1,607 Tires 787 839 811 2,328 2,611 2,662 Maint. repair 6,600 4,838 4,965 24,454 28,280 49,722 Depreciation 21,736 7,000 12,235 15,831 27,033 35,178 Interest 19,544 6,263 10,803 13,873 23,496 25,672 19,540 Overhead - 5,068 4,886 8,917 13,083

Total 62,131 43,034 49,012 101,401 134,452 173,244

Source: Arge INDOC.

April 1981 INDONESIA

JAKARTA-CIKAMPEK HIGHWAYPROJECT

Estimated Economic Costs and Benefits with Proposed Tolls (Rp billion)

Benefits Investment costs Operation and maintenance With passenge- Without passenger New road Total Total ope- time savinRs tie savL.lgs Old road Traffic Toll invest- Old road Nev road Total road ration and Old Nev Old New improvement Road works distribution faci- Total ment periodic Road Toll facilities Toll collection maintenance maintenance road road Total road road Total Year program (il. spurs) in Jakarta lities new road costs nainreance maintenance maintenance (13) (14) (15) (16) (17) (18) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (1) (2) (13)+(14) (16)+(17) (2)+(3)+(4) (1)+(5) (7)+(8) (9)+(10)+(11)

------1981 - 11.13 - - 11.13 11.13 - - 1982 2.40 17.70 - - 17.70 20.10 ------4.53 25.45 - 25.45 29.98 - - 1983 - - 3.11 - 3.11 2.08 - 2.08 1984 1.24 25.45 - - 25.45 26.69 - - - - 0.26 0.12 0.40 3.56 12.20 15.76 2.39 6.67 9.06 1985 - 24.27 2.00 1.18 27.45 27.45 - 0.12 0.02 0.61 -1.62 -0.97 4.29 19.39 23.68 2.87 10.54 13.41 1986 - 13.86 3.9s 2.74 20.50 20.50 -1.91 0.29 0.04 0.04 0.61 0.30 0.95 1.15 28.13 29.28 0.77 15.23 16.00 1987 ------0.30 0.62 0.29 0.95 1.24 32.02 33.26 0.83 17.29 18.12 1988 ------0.30 0.04 0.04 0.62 0.30 0.96 1.33 35.92 37.25 0.89 19.35 20.Z4 1989 ------0.30 0.28 0.97 1.43 45.16 46.59 0.96 25.13 26.09 1990 - - 0.28 0.06 0.63 0.64 0.28 0.98 1.53 47.27 48.80 1.03 25.68 26.71 1991 - 15.81 - 0.67 16.48 16.48 - 0.28 0.06 0.06 0.94 2.10 3.1.3 1.63 51.52 53.15 1.09 27.85 28.94 1992 - 17.11 - - 17.11 17.11 - 2.10 0.94 0.45 1.45 1.75 55.76 57.51 1.17 30.02 31.19 1993 ------0.45 0.06 0.95 0.45 1.46 1.87 60.00 61.87 1.25 32.18 33.43 1994 ------0.45 0.06 0.9. 0.44 1t46 2.01 64.24 66.25 1.35 34.35 35.70 1995 ------0.44 0.07 0.07 -1.47 -0.44 2.16 68.48 70.64 1.45 36.51 37.96 1996 - - - 0.47 0.47 0.47 -1.91 0.44 0.96 0.46 1.51 2.33 72.72 75.05 1.56 38.68 40.24 1997 ------0.46 0.07 0.98 0.99 0.47 1.53 2.51 76.96 79.47 1.68 40.85 42.53 1998 - - - - - 0.47 0.07 0.07 1.00 0.47 1.54 2.72 81.20 83.92 1.82 43.02 44.84 1999 ------0.47 1.08 2.51 3.63 2.96 87.78 90.74 1.98 46.42 48.40 2000 - 4.00 - - 4.00 4.00 - 2.51 0.07 I.09 0.53 1.69 3.23 93.85 97.08 2.16 49.27 51.43 2001 - - - 1.06 1.06 1.06 - 0.53 0.07 0.07 1.10 0.53 1.70 3.58 99.95 103.53 2.39 52.15 54.54 20n2 ------0.53 1.1! 0.53 1.71 4.01 106.04 110.05 2.69 55.03 57.72 2003 ------0.53 0.07 0.07 1.12 0.53 1.72 4.68 112.14 116.82 3.14 57.90 61.04 2004 ------0.53 1.13 0.54 1.74 5.45 118.23 123.68 3.65 60.78 64.43 2005 ------0.54 0.07 Total 8.17 154.78 5.90 6.12 166.80 174.97

Note: Costs and Benefits are calculated based on March 1980 prices,. Source: Arge INDOC. April 1981 INDONESIA

JAKARTA-CIKAMPEK HIGt{WAY PROJECT

Estimated Economic Costs and Benefits with No Tolls (Rp billion)

Investment costs Maintenance Benefits New road Total With passenger Without passenger Old road Traffic invest- Old road New road time savings time savings improvement Road works distribution Total ment periodic road Total road Old New Old New Year program (incl. spurs) in Jakarta new road costs maintenance maintenance maintenance road road Total road road Total (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (2)+(3) (1)+(4) (6)+(7) (9)+(10) (12)+(13)

1981 - 11.13 - 11.13 11.13 ------1982 2.40 17.70 - 17.70 20.10 ------1983 4.53 25.45 - 25.45 29.98 ------1984 1.24 25.45 - 25.45 26.69 - - - 3.11 - 3.11 2.08 - 2.08 1985 - 24.27 2.00 26.27 26.27 - 0.12 0.12 3.56 14.06 17.62 2.39 7.77 10.16 1986 - 13.86 3.90 17.76 17.76 -1.91 0.29 -1.62 4.29 21.68 25.97 2.87 11.89 14.76 1987 ------0.30 0.30 0.81 30.75 31.56 0.54 16.78 17.32 1988 ------0.29 0.29 0.87 34.41 35.28 0.58 18.70 19.28 1989 ------0.30 0.30 0.93 38.07 39.00 0.62 20.62 21.24 1990 ------0.28 0.28 0.99 49.24 50.23 0.66 27.47 28.13 1991 - 15.81 - 15.81 15.81 - 0.28 0.28 1.07 51.10 52.17 0.72 27.87 28.59 1992 - 17.11 - 17.11 17.11 - 2.10 2.10 1.14 55.08 56.22 0.76 29.89 30.65 1993 ------0.45 0.45 1.22 59.06 60.28 0.82 31.92 32.74 1994 ------0.45 0.45 1.31 63.04 C4.35 0.88 33.93 34.81 1995 ------0.44 0.44 1.41 67.02 68.43 0.95 35.96 36.91 1996 ------1.91 0.44 -1.47 1.51 71.00 72.51 1.01 37.98 38.99 1997 ------0.46 0.46 1.63 74.99 76.62 1.09 40.00 41.09 1998 ------0.47 0.47 1.76 78.97 80.73 1.18 42.02 43.20 1999 ------0.47 0.47 1.90 82.95 84.85 1.27 44.04 45.31 2000 - 4.00 - 4.00 4.00 - 2.51 2.51 2.07 89.08 91.15 1.39 47.10 48.49 2001 ------0.53 0.53 2.26 95.30 97.56 1.51 50.06 51.57 2002 ------0.53 0.53 2.50 101.56 104.06 1.67 53.04 54.71 2003 ------0.53 0.53 2.80 107.81 110.61 1.88 56.02 57.90 2004 ------0.53 0.53 3.28 114.06 117.34 2.19 59.01 61.20 2005 ------0.54 0.54 3.82 120.31 124.13 2.56 61.99 64.55 Total 8.17 154.78 5.90 160.68 168.85

Note: Costs and Benefits are calculated based on March 1980 prices. v Source: Arge INDOC.O April 1981 INDONESIA

JAKARTA-CIKAHPEK HIGHWAY PROJECT

Estimated Economic Costs and Benefits with Alternative Tolls (Rp billion)

Investment costs Operation and mainte,-ance Benefits New road Total With passenger Without passenger Old road Traffic Toll invest- Old road New road Total ope- tine savings time savings improvement Real works distribution faci- Total ment periodic Road Toll facilities Toll col- Total road ration and Old New Old New Year program (ioci, spurs) intJakarta lities new road costs maintenance maintenance maintenance lettion maintenance maintenance road road Total road road Total (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14) (15) (16) (17) (18) (2)+(3)+(4) (1)+(5) (7)+(8) (9)+(10)+(11) (13)+(14) (16)+(17)

1981 - 11.13 - - 11.13 11.13 ------1982 2.40 17.70 -- - 17.70 20.10 ------1983 4.53 25.45 - - 25.45 29.98 ------1984 1.24 25.45 - - 25.45 26.69 ------3.11 - 3.11 2.08 - 2.08 1985 - 24.27 2.00 1.I8 1.45 27.45 - 0.12 0.02 0.t 0.12 0.40 3.56 12.95 16.51 2.39 6.9Z 9.31 1986 - 13.86 3.90 2.74 20.50 20.50 -1.91 0.29 0.04 0.61 -1.62 -0.97 4.29 20.35 24.64 2.87 10.85 13.72 1987 ------0.30 0.04 0.61 0.30 0.95 1.15 29.29 30.44 0.77 15.61 16.38 1988 - - -- - 0.30 0.04 0.62 0.29 0.95 1.24 33.14 34.38 0.83 17.16 18.49 1989 - - - - 0.30 0.04 0.62 0.30 0.96 1.33 37.00 38.33 0.89 19.71 20.60 1990 - - - .* - - - 0.28 0.06 0.63 0.28 0.97 1.43 46.55 47.98 0.96 25.58 26.54 1991 - 15.81 - 0.67 16.48 16.48 - 0.28 0.0 0.64 0.28 0.98 1.53 48.58 50.11 1.03 26.10 27.13 1992 - 17.11 - - 17.11 17.11 - 2.10 0.6 , 0.94 2.10 3.10 1.63 52.73 54.36 1.09 28.24 29.33 1993 ------0.45 0.06 0.94 0.45 1.45 1.75 56.88 58.63 1.17 30-38 31.55 1994 ------0.45 0.06 0.95 0.45 1.46 1.87 61.03 62.90 1.25 32.52 33.77 1995 j------0.44 0.07 tI 0.95 0.44 1.46 2.01 65.17 67.18 1.35 34.65 36.00

1996 - - - 0.47 0.47 0.47 -1.91 0.44 0.07 *96 -1.47 -0.44 2.16 69.33 71.49 1.45 36.79 38.24 1997 ------0.46 0.07 0.98 0.46 1.51 2.33 73.48 75.81 1.56 38.93 40.49 1998 ------0.47 0.07 0.99 0.47 1.53 2.51 77.63 80.14 1.68 41.07 42.75 1999 ------0.47 0.07 1.00 0.47 1.54 2.72 81.79 84.50 1.82 43.20 45.02 2000 - 4.00 - - 4.00 4.00 - 2.51 u.07 1.08 2.51 3.63 2.96 88.23 91.19 1.98 46.57 48.55 2001 - - - 1.06 1.06 1.06 - 0.53 0.07 1.09 0.53 1.69 3.23 94.34 97.57 2.16 49.44 51.60 2002 ------0.53 0.07 1.10 0.53 1.70 3.58 100.48 104.06 2.39 52.33 54.72 2003 ------0.53 0.07 1.11 0.53 1.71 4.01 106.61 110.62 2.69 55.22 57.91 2004 ------0.53 0.07 1.12 0.53 1.72 4.68 112.75 117.43 3.14 58.11 61.25 2005 ------0.54 0.07 1.13 0.54 1.74 5.45 118.89 124.33 3.65 61.00 64.65 Total 8.17 154.78 5.90 6.12 166.80 174.97

Note: Costs and Benefits are calculated based on 14arch 1980 prices. Source: Arge INDOC. April 1981 - 57 - ANNEX I Page 1

INDONESIA

JAKARTA-CIKAMPEK HIGHWAY PROJECT

Related Documents and Data Available in the Project File

A. General Reports and Studies on the Transport Sector

A-1 Transportation Division, East Asia and Pacific Region, Transportation Sector Review, October 1980

A-2 W.D. Scott and Co., P.G. Pak-Poy and Associates, and Counterpart Bina Marga Staff, A National Study of Vehicle Weights and Dimensions in Indonesia, June 1978, eight volumes (Technical Reports Nos. 1-7 and Summary of Conclusions and Recommendations)

A-3 W.D. Scott and Co., P.G. Pak-Poy and Associates, and Counterpart Bina Marga Staff, A Study of Road User Charges in Indonesia, Draft Final Report, Main Report, June 1978

A-4 W.D. Scott and Co., P.G. Pak-Poy and Associates, and Counterpart Bina Marga Staff, A Study of Highway Ordinances and Enforcement in Indonesia, Draft Final Report, Main Report, June 1978

B. General Reports and Studies Related to the Pro 'ect

I. Items Related to the Metropolitan Jakarta Transport System:

B-1 Directorate General of Housing, Building, Planning and Urban Develop- ment, Ministry of Public Works and Power in cooperation with the Netherlands Directorate for International Technical Assistance, Jabotabek Development Strategy for Pelita II, January 1975

B--2 Intertraffic-Lenzconsult, Jakarta Metropolitan Area Transportation Study, April 1975

B-3 Japan International Cooperation Agency, Interim Report for Feasibility Study of Jakarta Ring Road Project, October 1977, (Volume I, Main Report; Volume II, Drawings)

B-4 Holland and Podolske, Review of Transportation Planning in the Jakarta Metropolitan Area, November 1977

B-5 Jabotabek Metropolitan Development Planning Team, City and Regional Transportation Issues and Development Evaluated 1978, September 1979

B-6 Same author, Preliminary Strategy for Jabotabek Organization, November 1979 - 58 - ANNEX 1 Page 2

B-7 Jabotabek Metropolitan Development Planning Team, Jabotabek Metropolitan Development Plan, December 1980, two volumes

B-8 Same author, Second Phase Report, August 1979, four volumes

B-9 Same author, Draft Proposed Guided Land Development Programme for Greater Jakarta, June 1980

B-10 Same author, The Coordination of Transport Planning, October 1980-

B-11 Same author, A Strategic Development Plan for Bekasi, November 1980

B-12 Same author, Transportation Strategy for Jabotabek, December 1980

B-13 Same author, Staged Industrial Land Development Pr-gramoe in Jabotabek, December 1980

II. Items Related to Indonesia's Toll Road System

B-14 Arge Intertraffic-Lenzconsult, Jakarta-West Java Tollway System Feasi- bility Study, Part A, Janiuary 1976, three volumes (Volume I, Volume I Annex, Volume II)

B-15 Same author, Jakarta-West Java Tollway System, Feasibility Study. Interim Report I On Coordination of Government functions and Creation of the Legal Foundation for a National Tollway Agency, May 1976

B-16 Same author, Jakarta-West Java Tollway System Feasibility Study, Part A, Summary of Findings and Recommendations, September 1976

B-17 Pacific Consultants International, The Consulting Engineering Services for Jakarta Intra Urban Tollway, September 1978, two volumes

B-18 Sauti-Renardet-ICE, Padang-Medan Highway, Impact/Toll Study foor Belawan-Medan and Medan Eastern Area, October 1978 two volumes

B-19 Same author, Padang-Medan Highway, Belawan-Medan-T. Morawa, Final Design Report, March 1979

B-20 Pacific Consultants International, The Consulting Engineering Services for Jakarta Intra Urban Tollway, March 1979, three volumes

B-21 P.T. (Persero) Jasa Marga, Construction and Management of Toll Road in Indonesia, October 1979

B-22 Mott-Renardet, Surabaya-Malang Highway Project Toll Road Study, Toll System Appraisal, November 1979 - 59 - ANNEX 1 Page 3

III. Items Related to the Jakarta-Cikampek Corridor Project

B-23 Lyon Associates, Inc., Feasibility Study, Trans-Java Highway, Preliminary Report, November 1972 (two volumes), Final Report, August 1973 (three volumes)

B-24 Arge Intertraffic-Lenzconsult, Jakarta-West Java Tollway System Feasibility Study, Jakarta-Cikampek Highway, May 1975, (Final Report, Volume II, Drawings),

B-25 Same author, Jakarta-West Java Tollway System Feasibility Study Part B, Jakarta-Cikampek Highway, July 1975, (Volume II, Drawings)

B-26 Same author, Jakarta-West Java Tollway System Feasibility Study, Part B, Jakarta-Cikampek Highway, December 1975, (Volume I)

B-27 Same author, Terms of Reference For Engineering Services For the Jakarta-Cikampek Highway, Technical Part, December 23, 1975

B-28 Directorate General of Highways, Jakarta-Cikampek Freeway, An Outline of the Project, May 1977

B-29 Arge Ingenieur Consulting Lenz & Co. - Dorsch Consult in association with Indec and Associates, Ltd., Jakarta-Cikampek Hi.ghway Final Engineering Design, Review of the Feasibility Study, Technical Part, December 15, 1977

B-30 Same author, Jakarta-Cikampek Highway, Final Engineering Design, Discussion Paper on Traffic Projections, Economic and Financial Evaluation, May 12, 1978

B-31 Same author, Jakarta-Cikampek Highway, Final Engineering Design, Contract No.: 03/LTR/LN/BM/77, Monthly Report, three volumes

B-32 Same author, Jakarta-Cikampek Highway, Final Engineering Design, January 1979, (three volumes: Book I, Summary Report; Book 2, Highway Drawings; Book 3, Structural Drawings)

B-33 Same author, Jakarta-Cikampek Highway, Final Engineering Design, Review of the Feasibility Study, Economic Evaluation, January 1979

B-34 Same author, Jakarta-Cikampek Highway, Bid Documents, January 1979 (five volumes: Volume I, Instructions to Bidders; Volume II, Standard Specifications; Volume III, General and Supplementary Conditions of Corntract, Special Provisions; Volume IV, Form of Tender (five parts); Volume V, Construction Drawings (three parts)

B-35 Same author, Jakarta-Cikampek Road. Improvement Program, October 1980 and revised in November 1980. INDONESIA APPRAISAL OF JAKARTA-CIKAMPEK HIGHWAY PROJECT ORGANIZATION OF THE CENTRAL AND PROVINCIAL HIGHWAY ADMINISTRATION

Centra Gave mr e Governments Mijnitea f Pubi c Provincial Wa It

E77 - j7Z

|~ SectoratY

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WorldBank 2213

Sob-Directorate

L Dvtpe u ietrt Sub-Directorate Sub-Diircortecectoraterint ai u ietrt rSub-Directorate | |Sub-Directorate jSu irctrae

Prearaio Eninern Tida Lan INDONESIA APPRAISAL OF JAKARTA-CIKAMPEK HIGHWAY PROJECT P.T. JASA MARGA ORGANIZATION CHART

PRESIDENT DIRECTOR

|TCHNICAL DIVISION MAAGNDRCOARD B(O COMMERCIAL DIVISION|

=------. .------

SUBDIVISION SUBDIVISION SUBDIVISION I SUBDIVISION SUBDIVISION SUBDIVISION OF PLANNING OF CONSTF'UCTION |o OF MAINTENANCE OP OPERATION OF FINANCE OF ADMINISTRATION OF SAFETY

D - I

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Source: P.T. JasiaMarga@ May 190 World Bank - 22325 62 -

CHART 3

INDONESIA

JAKARTA-CIKAMPEK HIGHWAY PROJECT

Observed Traffic Composition on the Jakarta-Cikampek Highway

50 Trucks W 40 2

404

30 Passenger -- ~ Opelets cascr30 - - . 0 EH 4420

0) 10o Buses {-~ 60