World Bank Document

Document of The World Bank

FOR OFFICIAL USE ONLY

Rjl 2J 3Z /

Public Disclosure Authorized Report No. 7056-IND

STAFF APPRAISAL REPORT

INDONESIA Public Disclosure Authorized

JABOTABEKURBAN DEVELOPMNT PROJECT

February 15, 1988 Public Disclosure Authorized

Asia CountryDepartment V InfrastructureDivision Public Disclosure Authorized

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 witbout World Bank iathorization. CURRENCYEQUIVALENTS (As of January 1988)

Currency Unit = Rupiah

US$1.00 - Rp 1,650 Rp 100 = US$0.06 Rp 1 million US$606

GOVERNMENTOF INDONESIA FISCAL YEAR

April 1 - March 31

UNITS AND MEASURES

1 meter (m) = 39.37 inches 1 kilometer (km) = 0.62 miles 1 hectare (ha) = 2.47 acres

PRINCIPAL ABBREVIATIONS AND ACRONYMSUSED

BAPPEDA - Regional GovernmentDevelopment Planning Board BAPPENAS - National DevelopmentPlanning Agency BKSP - JabotabekLevel I planning coordinationunit DAMRI - State-ownedbus company serving Regional Cities DGBM - DirectorateGeneral Bina Marga (Highways),MPW DGLT - DirectorateGeneral PerhubunganDarat (Land Transport),MOC DG Pajak - DirectorateGeneral Taxes, MOF Dinas LLAJR - Traffic and Highway TransportationDepartment, DKI-Jakarta Dinas PU - Public Works Department,DKI-Jakarta DKI-Jakarta - Jakarta Special Capital Province Jabotabek - Region comprisingjakarta, Bogor, Tangerangand Bekasi local governmentadministrative areas JUPCO - Project CoordinationUnit in DKI-JakartaBAPPEDA LLAJR - Directorateof Highway Transport,DGLT LLAK - Directorateof Urban Traffic and Transport,DGLT GOI - Government of Indonesia INPRES - Central GovernmentGrant to Local Governments KIP - Kampung (Village)Improvement Program KRA - Ministry of Home Affairs MOC - Ministry of Communications MOF - Ministry of Finance MPW - Ministry of Public Works O&M - Operations and Maintenance PBB - Property tax (Pajak Bumi dan Bangunan) PJKA - State Railway PPD - State-ownedbus company serving Jakarta RCUT - Regional Cities Urban TransportProject REPELITA - National Five-yearDevelopment Plan (RepelitaIV, 1984- 89; Repelita V, 1989-94) SATLANTAS - National Police TKPP - Tim Koordinasi PembangunanPerkotaan (Interagency CoordinatingTeam for Urban Development) FM OFICIAL omURONLY

INDONESIA

JABOTABEK URBANDEVELOPMENT PROJECT

STAFF APPRAISAL REPORT

Table o' Contents Page No.

LOAN AND PROJECT SUMMARY...... iii-v

I. THE URBAN SECTOR...... to...... *...... 1

A. Urbanization Trends and Policies...... 1 B. Jabotabek Region Development...... 5 C. Urban Transport Subsector ...... 6 D. Bank Experience and Lending Strategy...... 12

II. THE PROJECT..... to.... 14

A. Project Origin and Formulatione...... e...... 15 B. Project Objectives and Rationale for Bank Involvement...... 15 C. Project Suzmmaryo...... 16 D. Institutional and Policy Development...... 16 E. Trainingoo .* .9 .oo o o o o ..* .oo .o ..o o o.o ...... o...... 20 F. Physical Components ...... o... .o ...... o.... 21

III. PROJECT COSTS AND FINANCING ...... to...... ooo...... 23

A. Project Costs.oo...... ---- 23 B. Financing Plan..o...... 0.*00.0*0.000...... 24

IV. PROJECT ORGANIZATION AND MANAGEMENT..oo..o ...... 26

A. Implementation Arrangements.oooo.. .. o. o. oooo...... 26 B. Implementing Agencies...... o.*oo..o..o..o.o ...... 27 C. Implementation Schedule...... o. o..o...... 28 D. Procurement and Disbursement...... to.....*.... 28 E. Land Acquisition... o.. o o.o..o* o o .o.* ...o..eo .oo ...... o...... 31 F. Accounts and Audits.o...... 00 ...... 00 ...... 0 31

This report is based on the findings of an appraisal mission which visited Jakarta during October 1987 consisting of IBRD staff member Paul R. Stott and consultants Richard Barrett, Graham Simons and James 0. Tresidder. The appraisal was facilitated by the significant contributions of staff members Richard C. Podolske and Takehisa Iizuka during preparation of the project.

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

Page No.

V. FINANCIAL AiALYSIS OF DKI-JAKARTA...... 33

A. Current Financial Condition of DKI-Jakarta.o...... o... 33 B. Project Impact on DKI-Jakarta Finances...... 35 C. DKI-Jakarta Revenue Improvement Program...... 36 D. Financial Management and Accounting ...... 38

VI. PROJECT JUSTIFICATION AND RISKSo ...... 40

A. Project Justification .... o.o...... o...... 40 B. Economic Evaluation ...... 9 *9999...... 40 C. Urban Poverty Impact...... *.... 41 D. Environmental Impact*.**.*...... 41 E. ik43 ......

VII. AGREEMENTS REACHED AND RECOMMENDATION ...... o...... 44

ANNEXES

1. Urban Infrastructure Expenditure Programming ...... 46 2. Traffic and Transport in Jabotabek...... 52 3. Public Transport Operations in Indonesia...... 63 4. Details of Physical Components...... 90 5. Summary of Training and Technical Assistance...... 92 6. Project Cost Estimates ...... e 103 79 Procurement Guidelines*...... 107 8. Disbursement Schedules...... 109 9. Financial Statements for DKI-Jakarta (Actual and Projected)... 113 10. Environmental Impacto...... o.9.9o9o9.99 117 11. Analysis of Economic Benefits...... 123 12. List of Documents in the Project File...... 126

CHARTS

1. Organization Structure of Tim Koordinasi...... 127 2. Jabotabek Integrated Programming Organization Structure...... 128 3. Organization Structure for Project Implementation...... 0 129 4. Organization Structure of DKI-Jakarta ...... 130 5. Organization Structure of Dinas LLAJR in DKI-Jakartao...... 131

MAP

IBRD 20491 - Location of Jabotabek and Principal Project Components - iii -

INDOUIS;A

JABOTABIKURBAN DEVELOPMENT PROJECT

Loan and Project Sumary

Borrovers Republic of Indonesia

Beneficiaries: DKI-Jakarta,Ministries of Communicationsand Public Works

Amount: US$150.0million equivalent

Terms: Repayable in 20 years, including5 years grace, at the standard variable interestrate.

On-lending Part of the proceeds of the loan, the equivalent of Terms: US$89 million, would be onlent by the Government to DKI- Jakarta for 20 years, including5 years grace, at a 10% p.a. fixed interest rate. The Governmentwould bear the foreign exchange risk.

Project The project is located in the Jabotabekmetropolitan region Description: which includesJakarta (DKI)* the capital and largest city of Indonesia. The principal institutionalobjectives of the project would be to: (a) support integratedinfrastructure developmentplanning and programmingin the Jabotabek region and urban transportprogramming in DKI in particular; (b) increaseDKI's technicalcapability in preparingand implementingroad construction,and road rehabilitationand maintenanceprograms; (c) improve trafficmanagement in the region; (d) improveGovernment's policies, operations and regulationsof public transport;and (e) prepare for future integrateddevelopment expenditures in the urban sector. Through physical improvementsthe projectwould (a) reduce traffic congestionin DKI, (b) improve pedestrianaccess and road safety, (c) introducepublic transportationpriority schemes, and (d) open up additionalland for urban development in environmentallysafe fringe areas.

The project is expected to cost about US$224 million equivalent and would include expendituresfor: (a) upgrading of primary and secondatyarterial roads, (b) provisionof developmentroads on che city periphery,(c) major intersection improvements(including flyovers), (d) traffic management and road safety measures (includingcomprehensive corridor priority measures, bus priority schemes, improvements to isolated intersections,installation of traffic signals, pedestrian improvements,and street signing and marking measures), (e) road rehabilitationand maintenance, (f) institutionaland policy development(including improvements to public transportpolicy and operations,transportation planning,and traffic enforcement),and (g) technical - iv -

assistance for (i) project implementation,(ii) training in traffic engineering,and (iii) advisory services in integrated infrastructureplanning and programing, local revenue improvement,urban transportplanning, public transport regulationdevelopment, traffic restraintand road safety policy development,and operationalimprovements to bus companies;and (iv) future projectpreparation.

Risks: Project implementationrisks are expected to be minimal given the proven capabilityof the principalexecuting agencies (DKI and DC Bina Marga) to build and upgrade road infrastructure. The main risk lies in improvingPPD public bus company operations. Consultantswill be appointedto assist in strengtheningPPD in accordancewith GOI's action plan and performancewould be monitoredclosely by GOI. Prepara- tion of an integratedinfrastructure program for Jabotabek may prove risky due to the extensivecoordination and key policy decisionsrequired. This risk is expected to be minimized by the supervisionto be given to the task by Tim Koordinasi.

EstimatedCosts: Local Foreign Total - -- US$ million -----

Arterial roads and intersections 60.4 43.7 104.1 Developmentroads 21.2 13.3 34.5 Traffic management 13.2 14.7 27.9 Road maintenance 1.7 1.8 3.5 Training 1.4 3.6 5.0 Technical assistance 9.0 15.8 24.8

Base Cost 106.9 92.9 199.8

Physical contingencies 4.4 5.4 9.8 Price contingencies 6.4 7.9 14.3

Total Project Cost /a 117.7 106.2 223.9

FinancingPlan:

Bank loan 43.8 106.2 150.0 Central Government 27.0 -- 27.0 DKI 46.9 -- 46.9

Total 117.7 106.2 223.9

/a Includes taxes and duties estimated at US$10 million equivalent. EstimatedDisbursements:

Bank FY 1989 1990 1991 1992 1993 1994 1995

Annual 16.1 21.9 30.1 32.4 26.4 20.1 3.0 Cumulative 16.1 38.0 68.1 100.5 126.9 147.0 150.0

Rate of Return: 40% (weightedaverage)

Map: IBRD 20491 INDONESIA

JABOTABEKURBAN DEVELOPMENT PROJECT

I. THE URBANSECTOR

A. UrbanizationTrends and Policies

1.1 Populationand Demography. Indonesiais the fifth most populous nation in the world, with an estimatedpopulation of over 162 million (1385). The correspondingurban populationis estimatedat 40 million, which is a modest proportionby middle-incomecountry standards. However, urban population growth over the next two decades is likely to be very significant.By the end of the century 751 of all of Indonesia'spopulation growth is expected to have occurred in urban areas. The urban population is projectedto nearly double to about 76 million or over one-thirdof the projectednational population of over 210 million in the year 2000, and to reside chiefly (65X) on Java. Currently,almost half (48Z) of the urban populationresides in the 10 urban agglomerationswith over 500,000 persons in size. These cities in aggregateare growing at a somewhat faster rate (4.11 annually during 1971-81) than the remaining smallerurban areas (about 3.31 annually),and are expected to absorb the bulk of urban populationgrowth over the next two decades. About 650 cities and many more smaller towns exist in Indonesia. About 500 of these have been identifiedas strategicallyimportant to national development, ranging from the national capital,Jakarta, with a populationapproaching 8 million, to district capitals (known as Ibu Kota Kecamatanor IKK), some having populationsjust over 3,000 persons, that perform importantlocal service functions.

1.2 Administration. Urban developmentin Indonesiais synonymouswith local governmentdevelopment. Indonesia'scities and urbanizedareas are administeredby autonomouslocal governments.There are over 300 Level II RegionalGovernments including 54 Kotamadya (municipalities)and 247 Kabupatens(counties) which are responsibleto one or other of 27 Level I Regional Governmentsor Provinces (inctudingthe Jakarta Capital District Special Province--DaerahKhusus Ibukota or DRI). The Ministry of Home Affairs (MHA) is responsiblefor regional governmentaffairs, but in practice technical assistanceon spatial developmentand infrastructureprovision is mostly provided by the Ministry of Public Works (MPW) and, on financialmatters, by the Ministry of Finance (MOF). The National DevelopmentPlanning Agency (BAPPENAS)provides overall sector developmentoversight includingdevelopment budget allocations. The large number of agencies from these concerned - 2 -

Ministries1- and the often-uncoordinatedspecific programs and policies supportedby them in the attempt to acceleratese:vices during earlier Repelitashave led to a fragmentedand inefficientapproach to the present scale of urban developmentneeds. The Governmentof Indonesia(GOI) has recognizedthe need for a policy framework leading to (a) the strengtheningof local governmentsto better manage and finance their urban developmentrespon- sibilities,and (b) integratedplanning and programmingof urban infrastructure. GOI has issued a Statementof Policies for Urban Developmentand adopted an Action Plan agreed with the Bank under Loan 2816-IND (Urban Sector Loan), aimed at implementationand further developmentof these policies. Sector policy developmentand program coordinationis being addressedby a high level coordinatingteam (InteragencyCoordinating Team for Urban Develop- ment or Tim Koordinasi--TKPP)representing the concernedMinistries and agencies,and chaired by BAPPENAS.

1.3 Urban InfrastructureFinance. Provisionof most urban infrastructure is nominallythe responsibilityof Level II local governments.However, local revenue authorityand performance,as well as technicalcapacity of local governmentsis not commensuratewith local exi7nditureresponsibil- ities. Public expenditureso- urban infrastructure" grew in nominal terms

1/ Within MPW, the DirectorateGeneral Cipta Karya (DOCK) is responsiblefor city planning,water supply, sewerage and sanitation,solid waste management, and kampung improvement(KIP) through four separate implementing Directorates,as well as for public housing through the state enterprise FERUMNAS;the DirectorateGeneral Bina Marga pruvides assistancewith urban roads; and the DirectorateGeneral of Water Resources Development assists with urban flood protectionand bulk raw water supply.The Minis- try of Commnnications'(MOC) DirectorateGeneral of Land Transport (DGLT) is responsiblefor assistanceon urban transportmatters. Within MOP, the DirectorateGeneral of Monetary Affairs is responsiblefor central- local finance; the DirectorateGeneral of Taxation is responsiblefor property tax matters (local governments'main source of revenue);and the DirectorateGeneral of Budget administerstransfers to local governments. In MHA, developmentof local governmentis the responsibilityof the DirectorateGeneral Regional Development(DGBangda) and the supervision of local governmentaffairs is the responsibilityof DirectorateGeneral Local Administration(DGPUOD). Other Ministriesand Agencies such as the State Ministriesfor Housing, and Environmentand Population,the Minis- try of Health and BAPPENAS also play importantroles in urban affairs.

2/ Urban infrastructure,for the purposes of this discussion,includes the mainly Level II local governments'responsibilities of water supply, flood protectionand drainage, sewerage and sanitation,solid waste management,kampung (generallylow-income urban community)improvement and roads. Other key sectors in urban expendituressuch as power, railways, htealthand educationare currentlynot part of GOI's integrated urban developmentapproach. Over time it is expected that these sectors too will be brought fully into the integratedurban developmentprogram- ming process. - 3 - under the stimulusot GOI'a formerly buoyant developmentrevenues from about Rp 260 billion/yearduring Repelita II (1974-79)to about Rp 500 billion/year during Repelita III. During Repelita IV (1984-89)public expenditureson infrastructure(excluding public transport)are expected to average about Rp 560 billion/yearwhile private expenditures(mainly throughthe housing sector) are expected to average about Rp 150 billion/year;in total much less than the Rp 900 billion/yearforecast as the minimal need during the Repelita by the Bank's Urban Services Sector Report (Report No. 4800-IND)in 1984. During Repelita III public developmentand routine expenditureswere financed 751 by CentralGovernment and 25% from local government revenues. In the 20 largestKotamadyas the ratio of central-localcost sharingwas about 50:50, and in DKI-i3 karta about 40:60, but in all cases grant dependencyhas been increasing.- The economic constraintsfecing Indonesiaprevent the continuationof this policy. In the future it is foreseen that urban infrastructureprograms must be increasinglyfunded from local resourcesand OI has embarked on a series of measures to (a) classify urban infrastructure ind clarify functionalresponsibilities of local governments;(b) improve '-cal resource mobilization;and (c) improve central-localfinancing m chenisms over the medium term. Through measures supportedby Loan 2816-IND . '3 is implementingits new property tax law (PBB), reforminglocal tax oilices and reviewinglocal taxes and charges legislation,improving cost recovery through user charges for water supplies,establishing a municipal developmentfund (known as the Regional DevelopmentAccount or RDA), and reviewingthe central-localgrant system.

1.4 IntegratedInfrastructure Programing. In addi ion to improving revenue efficiencyand cost sharing, GOI with considerableassistance from the United NationsDevelopment Program and several donors includingthe Bank), is giving equal priority to expenditureefficiency. Through the establishment of an integratedurban infrastructureprogramming process (known as IUIDP) GOI intends to strengthenlocal governments'capacity to generatedevelopment programs based on local prioritiesand resources.Greater local participation in planning, financingand implementationis expected to result in better targettingof investmentsand greater commitmentto operationsand maintenance (O&N). The use of integratedplanning and judgetingtechniques is expected to achieve better program balance and more efficienttargetting of Central Government funding. Centrallyplanned and funded, but largelyuncoordinated, programsof the past have introduced imbalancesinto urban investmentand institutionaldevelopment programs. Beyond the intersectoralimbalances evident in the aggregatednational picture (Annex 1), expenditureprogram details in specificcities vary dramaticallyand central programs are often not well matched with interregionalor city priorities includingJakarta's. Nationally,urban infrastructureexpenditures are now dominatedby heavily

3/ A full discussionof local government finance in Indonesiais contained in the Bank's forthcomingreport on Public Resource Management. subsidizedpublic transportexpenditures in Jakarta and water resources expendituresin medium/small1 yowns while poverty-focussedKIP and sanitation expendituresare in decline.4 In most cases 06M efforts are lagging behind investment.

1.5 In order to rationalizeintegrated urban infrastructureprogram implementation(including donor assistancemanagement) GOI intends in future to differentiatebetween the needs and issues inherentto metropolitan agglomerations,primary cities (population>500,000 in 001 parlance)and secondarycities (population(500,000). Larger centers will generallywarrant high priority for central monitoring,guidance and technicalassistance. Smaller centerswill, in addition,warrant central financialassistance. Developmentprograms in each category will be sized to match institutional, financialand implementationcapacity of the local governments,but all will be similarlybased on (a) an integratedexpenditulg program, and (b) resource mobilizationand institutionaldevelopment plans.V Training of local governmentsin IUIDP proceduresand techniquesis now in progress in over half of Indonesia'sprovinces. Strategicguidance to local governmentsand

4/ As shown in Annex 1, one third of annual public expenditureson urban infra_tructure(excluding public transport)are currentlyfor water suppl which has grown in real terms by 14Z per year on average with strong support from donors to its present expected level cf about Rp 260 billion in GOI's FY87/88. Urban-relatedflood protectionaccounts for 181 of expendituresand has been growing strongly at 221/year to its current level of Rp 135 billion. The bulk of such expendituresare usually incurred as part of river basin flood control schemes and also have importantrural developmentbenefits. Although sewerage investments have grown steadily (13X/year)and are now Rp 30 billion or 4% of total, this has occurred from a very small base and impact on sanitationis still very limited. KIP (and concomitantlow-cost sanitationand solid waste management)expenditures, the erstwhile flagship of GOI's poverty and social welfare programs in the sector, have declined sharply (-5Z /year) and now stand at about Rp 55 billion per year or 7.51 of total expenditurein FY87/88. Urban roads expenditureshave also shown strong real growth (12%) in recent years although lagging traffic and currently stand at about Rp 85 billion per year or 11% of total. In urban transportterms, however, the roads expenditurepicture fails to capture GOI's costly proposed urban toll road and public transport expenditures. As discussedin Annex 1, the inclusionof urban-related railway and bus expenditures(averaging Rp 280 billion/year)into the urban infrastructureexpenditure program shifts expenditureand funding balances dramatically.

5/ In the case of the largest cities implementationof their expenditure programswould likely be carriedout along sectoral lines as in the present case with Jakarta. Under the overall umbrella of an agreed urban infrastructureexpenditure program for Jabotabek,DKI-Jakarta would proceedwith separate programs in urban transportand sanitation/water supply under the JabotabekI and II projects to be supportedby the Bank. agenciesfor the full implementationof IUIDP systems in Repelita V is being formalatedby Tim Koordinasi. B. JabotabekRegion Developoent

1.6 Jabotabek (00I's mnemonic for the metropolitanconurbation consistingof the region bounded by DKI, KotamadyaBogor and KabupatenBogor to the south, and the rapidly urbanizingKabupatens of Tangerang in the west and Bekasi in the east), will be the first metropolitanarea to be addressed under the GOI's emerging urban developmentpolicy regime. The predominant city in the region is DKI-Jakarta,the national capital and seat of government, as well as the largest city in Indonesiaand the commercial and administrativehub of the country. IWitha populationapproaching 8 million, and an additional 1.3 million persons residing in the surroundingurban areas (1986),Jabotabek ranks among the 25 largest metropoliin the world. The city propermore than doubled in populationbetween 1961 and 1980 (from 2.9 to 6.5 million)and is expectei to nearly double again between 1980 and 2000 when it is estimatedto reach 12 million persons. During the same time period, the populationof surroundingurban areas is expected to at least treble, leading to a conurbationcontaining 17 million persons by the onset of the 21st century.

1.7 Expenditureson urban infrastructure(including public transport) in Jabotabekduring Repelita IV are expected to total some Rp 1.7 trillionor 40Z of total. Urban transportexpenditures, chiefly for public transport(rail and bus) investmentsand operating subsidies,account for over 702. Despite past efforts, investmentin Jakarta's infrastructurehas not maintained pace with growth and considerabledeficiencies both in terms of availabilityand level of serviceremain. Concern over adequate services in the capital, particularly for the urban poor, is expressedat the highest levels. Consequently, in line with PresidentialInstruction INPRES 13/1976and with assietancefrom Loan 1336-IND(Second Urban DevelopmentProject) the developmentpriorities and options of Jabotabekwere studiedduring 1979-82,and in 1984 recommendations were adopted into the JakartaMetropolitan Development Plan of DKI- Jakartaand the workplan of the DKI/West Java interprovincialcoordinating body (JabotabekBKSP). The main features of the Jabotabekplan include (a) an integratedgrowth and investmentstrategy based primarilyon economic and socialperspectives; (b) a strong spatial dimensionthrough the implementation of a more environmentallysound, east-westalignment for future developmentin order to avoid the increasinglynegative impactsof the entrenchednorth-south orientation,including: (i) pollutionof the importantacquifer recharge areas to the south of the city, and (ii) high developmentcosts in the environmentallysensitive wetlands and poor soils in northern coastal areas; (c) a major emphasis on water supply, sanitation,and flood protectionneeds and a combinationof guided land developmentand urban bettermentapproaches focussedon primary infrastructuredeficiencies (including roads); and (d) an implementationstrategy based on short-termsubsectoral action programs and longer-terminstitutional development-based and integratedsolutions.

1.8 GOI and DKI, with assistancefrom the Japanese International CooperationAgency and Overseas Economic CooperationFund (OECF) as well as the Bank, have begun to implementthe Jakarta MetropolitanDevelopment Plan although so far an integratedexpenditure plan has not been formulated. To date emphasishas been laid on water resourcesneeds. Through Loan 2560-IND (West Tarum Canal ImprovementProject) urgently needed, additional raw water is being brought to Jakarta under an agreementbetween DKI and the Jatiluhur (River Basin) Authoritywhich provides for full cost recovery.OECF are helping finance treatmentplants and trunk mains to distribute the treated water. Under Loan 2236-IND (Jakarta Sewerageand SanitationProject) a proposedSecond JabotabekUrban DevelopmentProject is under preparation intended,among other things, to market the new water supplies,rehabilitate the existing distributionsystem (which leaks badly) and strengthenthe JakartaWater Enterpriseas well as regionalwater pollutioncontrol. OECF is also providingmajor assistanceto the Jakarta Flood Control Project, and Loan 2236-IND is also helping implementa pilot sewerageand low-cost sanitation scheme includingestablishment of a sewerageenterprise.

1.9 Despite heavy expenditureson the Jakarta Outer Ring Road and the Jabotabekcommuter railway (both assisted by OECF), attention to Jabotabek's urban transportissues has been lagging due to institutionalweaknesses now being addressedwith assistance funded by Lean 2049-IND (Jakarta-Cicampek HighwayProject) and the lack of an integratedbroad urban transportperspec- tive. Improvementof urban transportconditions in Jakarta is now a high priorityfor DKI and the Government. Through the proposed project and an earliercompanion project, Loan 2817-IND (RegionalCities Urban Transport Project),it is expected that significantimprovements in the urban transport subsector,including public transport,can be accomplished,as well as improvementsin planning and programmingof all sector expendituresin Jabotabekfor the future.

C. Urban TransportSubsector

1.10 Traffic conditionshave deterioratedin Indonesiancities over the past decade, caused in large part by an almost 15% annual increase in the number of motor vehicles but also due to inadequateinstitutional response by GOI and local governmentsto the specificneeds of urban transportplanning and operation. The effect of this increasehas been particularlyacute in and around major cities where most motor vehiclesare concentrated.Jakarta alone has 18% of all registeredvehicles in the nation and 39% of all registered passengercars. At the same time there has been a serious degradationof urban road networks. A recent survey of 64 cities and towns by DGBM concluded that about 17% of the main road network is structurallyunstable and liable to physical failure in the next five years even with routinemaintenance. About 32% of these networks is also geometricallyinadequate and unable to carry the projectedRepelita IV traffic without extensiverepeated congestion. In Jakarta it is estimatedtoday that some 60% of the arterial road network is operatingabove acceptable levels of capacity,resulting in heavy queuing and long periods of congestionthroughout the day.

1.11 The key urban transport issues to be resolved in Jabotabek relate to: (a) optimizationof the urban transportexpenditure program, particularly the public transportelements (railwayand bus modes); and (b) a variety of related institutionalweaknesses hinderingsector developmentincluding (i) clarificationof agency responsibilities;(ii) strengtheningof DKI- - 7 -

Jakarta traffic managementand engineeringcapacity; (iii) strengtheningof bus transportregulation and PPD bus company operations;and (iv) strengthening of DKI-Jakartaroad maintenancecapacity.

Urban TransportInvestment Programoing

1.12 Investmentin and maintenanceof urban transportfacilities in the Jabotabekarea over the period 1982/83-1986/87totalled Rp 627 billion of which Rp 98 billion (16Z) was contributedby DKI. The other principal investorswere DGBM (primaryroads)--Rp 123 billion (20%); Jasa Marga (toll roads)--Rp71 billion (11%); and DGLT (public transport)--Rp335 billion (53%, of which 43Z was far bus transportand 57% was for rail). All planned expendituresover the next five years by these agencies,if implemented,would lead to a threefoldincrease in total--chieflyin the public transportarea. Although the proportionof investmentin the past beween private and public transportwas reasonablywell balanced,a disproportionateamount of the public investmentwas spent on rail serviceswhich carry about 2% of motorized trips, compared to buses which carry 52%. Projectedexpenditures accentuate this imbalanceeven more seriouslywith 50% of planned investmentsgoing to rail. This massive investmentin rail is estimatedto benefit as few as 6% of travellers. On the other hand, bus systemswhich would carry about 56% of daily trips would receive 8% of planned expenditures.

1.13 The inefficienciesevident in GOI's costly urban toll road program, and public transportsubsidies of the past, and the serious consideration given to substantialrail-based transit investmentsin Jakarta are indications of the latent deficienciesin current urban transportplanning. The Bank's dialoguewith GOI since 1975, aided by technicalassistance funded through Loan 2049-INDhas helped reorder prioritiesto some degree. Attention is now being given to trafficmanagement. traffic enforcement,road rehabilitation measures,and selected new arterial road constructionthat can achieve high impact at much lower cost within the financialmeans of DKI-Jakartaand the concernedCentral Governmentagencies. What is now required is to bring all agencies togetherthrough the Tim Koordinasimechanism and the IUIDP process in order to develop a clear sense of prio.itiesamong urban infrastructure expendituresbased on the Jabotabekplan, includingurban transportation investmentsand O&M, within realisticallyestimated governmental resources in order to assure better allocationof the limited funds available.Within the urban transportsubsector the significantinvestment issues are (a) improvementof the road network capacity;(b) improvementof bus transport and restraintof private vehicles;and (c) appropriatedevelopment of mass transit and commuter rail systems.

1.14 JabotabekRoad Network Capacitv. Within the Jabotabekroad network there is a pronouncedlack of secondaryarterials, whici results in traffic concentratingon a few major thoroughfareswhich are congestedover long periods of the day. Moreover, for historicalreasons the orientationof the primary network lies in a predominentlynorth-south direction and residential and commercialexpansion is constrainedfrom proceedingon the eastern and western fringes in accordancewith official land-use planning. While all main roads are paved, surface conditionsare often poor. Curbs and foopaths are exceptionsrather than the rule, most roads being lined with ill-defined - 8 -

sidewalks,ditches and open drains. Pedestriansare thereforeoften required to walk on the roadway. Effectiveroad width is further reduced by parked vehicles,and a variety of slowmovingvehicles as well as undisciplined transitvehicles. Conditionsare describedmore fully in Annex 2. With assistancefrom consultantsfunded under Loan 2049-IND,DKI's Development Planning Board (BAPPEDA),and DGBM have studied network capacity constraints and future demand, and identifieda programof primary and secondaryarterial road and intersectionconstruction and improvementsaimed at relieving congestionand providingsignificant east-west movement capacity. In addition,an extensiveprogram of traffic engineeringand road safety improvementsto existing roads has been developed,including traffic signals and bus prioritymeasures. These low-costmeasures contrast sharplywith the heavy expendituresproposed in urban toll roads by Jasa Marga. However, followingprivatization of the toll road program recently,it is likely that timing and effectivenessof such investmentswill be more appropriateand impose a lesser burden on GOI resources.

1.15 Public TransportConditions. Altbhugh currently55% of motorized trips in Jakarta are by various forms of public transport,this mode has an unfulfilledmajor role; leaving less efficientprivate transport to fill a growinggap. Options for provisionof effectivepublic transport includerail and bus-basedtransit systems, as well as local service bus and micro-bus services. As discussedabove, current plans emphasizea rail-basedsolution and propose significantpublic investmentsin the State Railway's (PJKA) Jabotabekcommuter rail system while proposed bus system investmentsare minimal. Studies carried out under Loan 2049-INDunderscore the serious imbalanceevident in this strategywhich provides for only some 2% of projectedtrips in the region at a disproportiopqtecost and will likely require significantannual operatingsubsidies.- Bus-based solutionson the other hand, although potentiallymuch less costly would rely on exclusivebus ways and trafficdemand restraintpolicies yet to be developed. A review of the proposedurban mass transport investmentprogram in the light of preparationof the Jabotabekexpenditure program is clearly essential.A full

6/ The current proposals for the Jabotabekurban rail system involve expendituresof some US$2 billion by the year 2005. The proposed system is based on the upgradingof the existing 175 km rail network which links Jakartawith suburban communitiesalong the main radial railway lines. Although the intentionappears to be that this system should, among other things, serve as a mass transit system for Jakarta, the linkages provided do not correspondto the main flow patterna (particularlyin the center of the city). Consequently,demand is unlikely to match the original feasibilitystudy estimates.Although revised downwardsconsiderably in 1985, estimates still predict a doubtful 26-fold increase in ridership between 1987 and 1992. These estimatesand the lack of consideration given to complementarybus feeder services raise considerabledoubts as to the economic viabilityand operationalsuccess of the rail project in its present configuration. - 9 -

discussionof public transportissues in Jakarta is given in Annex 3; following are some of the main concerns.

1.16 Bus TransportPolicies. The Governmentmoved over the past several years to replace privately-runscheduled bus serviceswith subsidized,state- owned services. This was done in part to improve upon the low level of service provided by the private sector, and in part to keep fares low for students and the urban poor. The shift has been dramatic although the dominant proportionof public transport service is still providedby the private sector througha wide array of services includingmini-buses, motorizedthree-wheeled vehicles, and taxis. In 1978 PPD (the State-runbus company) operated 30% of all regular buses in Jakarta. By the end of 1983 it had taken over 24 private bus companiesthat had been unable to remain viable in the face of government-controlledlow bus fares, so that over 97% of large buses in Jakarta are now operated directly or controlledby Government. Another state owned bus company (DAMRI) provides services with about 500 buses in 8 regional cities. In addition,Government is currently in the process of introducingpublicly owned and operated mini-bus services to an additional15 cities. The total cost of Governmentsubsidies for public transporthas been significant.PPD revenues cover 50% of its total costs (includingdeprecia- tion), requiringan annual operatingand capital subsidy of Rp 37 millien. GOI spending on bus subsidiesduring Repelita IV (198-4;-9)is expected to amount to about Rp 170 billion, or 4% of total spending on urban services by all levels of Government. In the current tightly constrainedeconomic situation,GOI has permitteda fare increase in the hope of withdrawingits operating subsidy to PPD. While DAMRI and private operatorsappear to be profitableunder these circumstances,PPD, which carries about 44Z of all trips by public transport,is required to provide unprofitable,socially- justified servicesand has severe efficiencyproblems which limit its ability to cover even its operatingcosts. The chisf issue in bus transportation, having an importantbearing on its role in mass transit solutions,therefore becomes t:Y improvementof public bus company operationsto achieve full cost recovery.-

1.17 Bus serviceoperations in Jakarta are hampered by congestion,bus shortages,inefficient route planning and ineffectiveregulation issues, exacerbatedby bus crews attemptingto maximize incomes on their rented buses. Buses are so uncomfortableand schedulesunreliable that anyone who can afford to travel by alternativemeans does so. This, in the absence of demand restraiatand parking controls encouragesuse of private transportation

7/ After PPD took over, fares were raised substantiallyin order to improve PPD's financialpos.tion. But the company continuedoperating at a loss and was unable to expand to meet growing demand. Mayasari, the one remaining private operator of full-sizedbuses in Jakarta, has regained its market share and operates 550 buses of all types with a fleet avail- ability of 88% compared to 1,150 and 59% for PPD. Mayasari also exhibits significantlymore efficientstaffing/bus ratios than PPD--7.5 versus 14.5. Overall, the private sector currentlyprovides over half of total public transportservice in Jakarta. - 10 - which uses much more road space per accommodatedtrip. During October 1986, a National Public TransportPolicy Study outlined in preliminaryform a set of policies and actions that could lead to the supply of viable and efficient urban public transportservices which meet the needs of the public at minimal cost to Government.This report was well received by Government and, with a few reservations,was endorsed. Based on this study, a feasible action plan of measures to overcome the bus issues has been formulatedby GOI including (a) strengtheningof public transportplanning and regulationcapability in DLLAJR; (b) consolidationand strengtheningof PPD operations to achieve full cost recovery (Annex 3). In addition,in order to combat congestion,various measures to improve traffic flows, provide bus priority facilitiesand control parking are being introducedby DLLAJR.

InstitutionalIssues in the Urban TransportSector

1.18 The road law of 1980 and KEPRES 14/1987have clarified functional responsibilitiesamong the various levels of governmea..for ditferent classes of roads, but. in practice,many road links within urban areas have not yet been formally classifiedand correspondingresponsibilities agreed by the affected central,provincial, and city governmentagencies. The lack of clarity in jurisdictionalresponsibilities, combined with limited financial resourcesat the local governmentlevel, has resulted in DGBM assistingcities in upgradingand maintainingparts of the urban road network which are not its responsibility. Beyond financialand organizationalproblems, city staff developmentin the provisionof urban transportfacilities and services is weak and can be correctedonly by concertedmid- to long-term training and staff developmentprograms. Recognizingthat the local authoritiesare unlikely to have sufficienttechnical and financial resourcesto meet the needs in the sector, DGLT and DGBM will need to play an importantrole in assisting local governmentsin the planning,design and funding of urban transport facilitiesand services for the near to middle term.

1.19 Sector Organization. At the national level, technical responsibilityfor the urban transport sector rests with two agencies, the Ministry of Communications(MOC), through its DirectorateGeneral of Land Transport (DGLT) and the Ministry of Public Works, through its Directorate General of Highways (Bina Marga or DGBM). The former is responsiblefor sector oversightand planning of all transportmodes, and for the regulation and control of all land-basedtransport modes, includingall forms of public transport. The latter is responsiblefor the Ietailed planning,construction and maintenanceof the national road network.- Responding to the need for greater attentionto emerging urban transportproblems, both DGBM and DGLT have recently created urban directoratesin their organizations. In contrast

8/ A separate State Entarprise,the National Toll Road Authority (Jasa Marga), was establishedin 1978 to finance and manage all urban and inter-urbantoll roads. However, the DirectorGeneral of Bina Marga is chairman of its governingboard, and DGBM has substantialinfluence on Jasa Marga's toll road program through the planning and design of its facilities. - 11 - I

to DCBM's capacity,the DCLT's Directorateof Urban Traffic and Transportation (LLAK) suffers from limitationsin staffing and budget, although a succesful traffic engineeringtraining capacity has been establishedwith assistance from Loan 2049-IND at DGLT's training center at Bekasi. In practice,DGBM plays a significanttechnical assistance role in helping local governments in trafficmanagement, as well as road constructionand maintenance. Under Loan 2817-IND,DGBM is assistingfour primary cities in this way, and the recently approved Second Rural Roads Project will provide extensiveassistance to Kabupatengovernments (including urbanizing Kabupatens). Tim Koordinasi is currentlyreviewing agency roles, includingformal recognitionand strengthening of DGBM's role in trafficengineering and management,which would help bring uniformity to and rationalizeassistance to local governments. In addition to regulatingpublic transportpolicy, DC.LTin effect cauiLroisthe state-nwnedbus companies in the principalcities (PPD in Jakarta and DAMRI in the main regional cities). Another national agency significantlyinvolved in urban transportis the national police force (for traffic regulationenforcement).

1.20 In DKI-Jakarta,the BAPPEDA is responsiblefor the review and integrationof sectoral investmentprograms under DKI control. Coordination with programs in the surroundingProvince of West Java occurs through JabotabekBKSP (para 1.07). In practice,neither body exerts much influence on centrally-fundedprograms of central agencies.The DKI-Jakartapublic works department (Dinas PU) is the agency responsiblefor the design, construction and maintenanceof the secondaryand local road networks. The traffic and transportplanning department (Dinas LLAJR) is responsiblefor traffic planning and the provisionof traffic controldevices (sharedin practice with Dinas PU which is also responsiblefor operationand maintenanceof traffic signals),and public transportregulation. Both Dinas have received technical assistanceunder Loan 2049-IF which has begun strengtheningtheir respective capabilities. The local branch of the Traffic Division of the National Police Force is responsiblefor the control and regulationof traffic. Further strengtheningof these agencies is necessary to better address traffic managementand transportregulation commensurate with Jabotabek'sneeds.

Urban Road Maintenance

1.21 There are about 3,400 km of roads of various width in DKI-Jakarta's road inventory,however, an unknown but significantand rapidly growing amount of roads provided by private developershas not yet been taken over by DKI. Moreover non-vehicularkampung access roads do not feature in this inventory. A sample survey in 1987 showed the general surface conditionas 'fair'. Expenditurein Jakarta on road maintenance (as distinct from improvement)in 1986/87was about Rp 11 billion or 33% of transportexpenditures by DKI- Jakarta. About 70Z of this was spent on main roads. This amount is inadequate for satisfactoryroutine and periodic maintenance,particularly of local roads. Planning for maintenance is 'bottom-up'based on requests from local offices, and 60% is carried out by private contractorsand the remainderby force account (limitedto works costing

FinancingExpenditures in Urban Transport

1.22 In recent years direct central government spendingon urban roads (not includingtoll roads) has amounted to about 50% of all such investments, and Central Governmentgrants to local governments,for much of the remainder. Locallygenerated (provincialand city) revenues account for about 10-20% of funding,depending on location. In view of the pressing need for urban transportinvestments and limitationson centralgovernment resources, it has become clear that (a) cities will need to contributesubstantially more of their own resourcesfor urban transportpurposes (particularlymaintenance), and (b) a higher proportionof central governmentfunding for urban transport investmentswill need to be in the form of loans to cities rather than grants. Financingof urban transportexpenditures cannot, of course, be consideredin isolationfrom other urban infrastructureexpenditures. The situationis even more complex in urbanizingKabupatens with substantialrural infrastructureresponsibilities. GOI has taken a number of promising steps to assist local governmentsin increasingtheir financialparticipation in developmentand increasecost recovery (para 1.03) from which DKI-Jakartain particularshould benefit considerably. A fuller discussionof DKI-Jakarta revenue improvementand expenditurefinancing is given in Chapter V below.

D. Bank Experienceand Lending Strategy

1.23 Through its lending and sector work in Indonesiathe Bank has sought to (a) help formulatea realistic sector policy frameworkwith particular emphasis on planning, programming,finance and operations;(b) strengthen agencies responsiblefor sector oversightand planning,implementation and O&M, (c) improve resource mobilizationand utilizationin local governments, and (d) focus project benefits on lower income groups. The Bank's strategy in helping GOI attain both long and short-termgoals is a step-by-stepapproach with the agencies concernedinvolving mutually reinforcingsector level and investmentoperations in parallel.The immediateobjectives sought for the sector and subsectorare: (i) to improve expenditureefficiency in urban infrastructure(and urban transport in particular)through an integrated planningand programmingapproach; (ii) to increase local governments'financial resourcesand technicalcapabilities consistent with GOI's objective of devolvingmore developmentresponsibility; (iii) to improvetraffic management and road capacity; and (iv) to improvepublic transportconditions with - 13 - particularemphasis on the regulatoryenvironment and the financialand operationalperformance of the public bus companies.

1.24 The Bank has developedan extensiveknowledge of the urban and transportsectors through 12 urban projects (includingone urban transport project) agd nine road projects financed since 1969. Of these, ten have been completed._ Overall, the institutionaland developmentobjectives of the projects (which have had a strong poverty orientation),have been met. Equally importanthas been the sucesssof project and sector work in assisting the Government in formulatingits overall program and policies in the sector. Studies supportedby the Bank and others during this period have helped in the diagnosisand strengtheningof local governmentfiscal and institutional capacities,subsectoral investments, and O&M programmingpolicies, and in sector and housing finance and cost recovery. Drawing on this experience,an Urban Sector Loan (No. 2816-IND)was approved by the Bank in FY87, which addressesthe longer-termissues in the sector and supportsa number of areas where policy and institutionalreforms are needed. Among the difficulties experiencedin both urban and road projects to date have been: (a) an overly centralizedstructure resulting in implementationinefficiencies; (b) con- structiondelays mostly due to cumbersomeprocurement practices; and (c) poor maintenanceof existing infrastructure. Experience in previous projects involvingDKI-Jakarta has been very good in general, particularlywhere DKI- Jakartahas strong commitmentto project funding and close control over implementation. A notable exceptionhas been Loan 2236-IND (Jakarta Sewerage and SanitationProject) currently facing serious delays in completionof its physicalobjectives. That project is the responsibilityof DG Cipta Karye's nascent Directorateof EnvironmentalSanitation and has suffered from lack of any substantialinvolvement of DKI-Jakarta. The projecthas recently been restructuredto enable DKI-Jakartato fully participatein its implementation.

1.25 The overall expenditureprogram for Jabotabekup to the end of Repelita IV is subsumed in the sector expenditureprogram previouslyagreed in terms of Loan 2816-IND (Urban Sector Loan, 1987) as illustratedin Annex 1, Tables 1 and 4. A subsequentprogram for the Ropelita V period satisfactory to the Bank would be determinedin early 1989 (para. 2.7). Due to its magnitude, however, the implementationof the overall integratedurban infrastructure expenditureand institutionaldevelopment program in Jabotabek would, togetherwith the proposed Bank support, be organizedalong broad sectoral lines in order to facilitateprogram management in accordancewith GOI's urban developmentprogram format (para. 1.5). Under this approach the present project will be concernedmainly with the urban transportaspects of the overall

9/ Three urban sector completionreports and Project PerformanceAudit Reports (PPAR) have been issued to date: Loan 1040-IND- Jakarta Urban DevelopmentProject (PPAR 4620); Loan 1049-IND - Five Cities Water Supply Project (PPAR 6256); Loan 1336-IND - Second Urban DevelopmentProject (PPAR 6329). The three transport sector completionreports and PPARs issued to date are: Credit 154-IND - First Highway Project (PPAR 2098); Credits 260 and 388-IND - Second and Third Highway Projects (PPAR 3267); and Loan 1236-IND- Fourth Highway Project (PCR 5624). - 14 -

Jabotabekprogram includingmajor investmentsin roads and traffic engineering as well as public transport. Followingon the heels of this project GOI expects shortly to undertakewith Bank assistance a Second JabotabekUrban Developmnt Project which would mainly concern the urban water resources managem_ntaspects of the overall program, i.e., raw and treated water supply, waste disposaland water pollutioncontrol (para. 1.8). It is intended that implementationof both projects would be managed and coordinatedby DKI- Jakarta to ensure appropriateconsistency. - 15 -

II. THE PROJECT

A. Project Origin and Formulation

2.1 The principalfocus of the project has been under discussionwith the Governmentfor severalyears. Urban transportpolicy dialogue began in 1975 when the Bank was asked to comment on the German Government-financed urban transportstudy for Jakarta. These discussions,and others based on subsequent1977 Bank mission findings,did not progress much due to the Government'suncertainty about its approach to various urban transportation investmentsbeing proposed by differentagencies, and opposition to the Bank's proposal to finance primarily short-termand relatively low-cost traffic managementand bus transportationimprovements. During the early 1980s the Ministry of Communicationsexpressed renewed interest in the project, which was followedup in 1984 with identificationand preparationof a project concentratedprincipally on traffic managementand road upgradingmeasures to be implementedby DKI-Jakarta. During 1986 GOI introducedthe concept of integratedurban infrastructuredevelopment programming (IUIi4P) which provided a broader context for the project and led to the present format. The pro . t as presentlyconstituted was prepared with the assistance of consultantsLU, over a three-yearperiod (1984-87)and was appraised during October, 1987. Negotiationswith the Governmentwere held in Washington D.C. during February 1-4, 1988. The GOI delegationwas led by Mr. P.P. Simatupang,Chief of Communicationsand Tourism Bureau, BAPPENAS.

B. Project Objectivesand Rationalefor Bank Involvement

2.2 The project's institutionalobjectives would be to: (a) support integratedinfrastructure development planning and programmingin the Jabotabekregion and urban transportprogramming in DKI-Jakartain particular; (b) increase DKI's technicalcapabilities in preparingand implementing road construction,and road rehabilitationand maintenanceprograms; (c) improvetraffic management in the region ; (d) improve Government's policies,operations and regulationsfor public tLansport;and (e) prepare for future integrateddevelopment expenditures in the urban sector. Through phyeical improvementsthe project would (a) reduce traffic congestion in DKI- Jakarta, (b) improve pedestrianaccess and road safety, (c) introducepublic transportationpriority schemes, and (d) open up additional lands for urban developmentin environmentally-safefringe areas.

2.3 The principal strategy of the project is to improve expenditure efficiencyand resourcemobilization in urban infrastructure,and urban transportin particular,through an integratedplanning and programming approach that would build on institutionaldevelopment commenced in earlier

10/ The consultantsresponsible for projectpreparation are a consortiumof PamintoriCipta Ltd, BIEC InternationalInc., and PT Seecons (Indonesia) in associationwith Colin Buchanan & Partners and T.P. O'Sullivan & Partners (U.K.). The IUIDP aspects were prepared by UNCHS/UNDP Project INS/85/005. - 16 - projects. The project would thereforeserve as a logicalextension of the Government'sand various donors' efforts (includingthe Bank's) in previous urban and transportprojects and would help to implementrecent urban sector policy initiatives.

C. Project Summary

2.4 The project would provide technicalassistance for institutional developmentand training in urban transportand urban managementand include physical works (mainlycivil works and some equipment) for an extensive program of road improvementand construction. Technicalassistance would be provided for (a) project implementation;(b) advibcry services in (i) integrated infrastructureplanning and programming;(ii) municipalrevenue improvement;(iii) urban transportplanning and public transportregulation development;(iv) traffic restraintpolicy development;(v) operational improvementsto public bus companies;and (vi) air qualitymonitoring; (c) future expenditureprogram preparation;and (d) training in traffic engineering. The physical componentswould include: (a) major upgradingof about 90 km of primary and secondaryarterial roads; (b) four major flyover intersectionimprovements; (c) a four year program of trafficmanagement and road safety measures; (d) a four year program of road rehabilitationand maintenance;and (e) about 35 km of developmentroads on the city's eastern and western fringes and the former KemayoranAirport site. These components are discussedfurther below and detailed descriptionsof the various physical and technicalassistance components are given in Annexes 4 and 5.

D. Institutionaland Policy Development

2.5 The proposed project would address the followinginstitutional and policy developmenttasks through advisory services (about US$8 million; 3Z of total projectcost), aimed at five broad areas: (a) developmentif a five-year integratedinfrastructure investment program for the Jabotabek region; (b) developmentof an integratedurban transportplan for the Jabotabek region; (c) strengtheningof national urban transportpolicy institutions; (d) strengtheningof DKI-Jakartain revenue improvementand financialmanagement, transportationplanning and regulation,and trafficmanagement; (e) improvementof public transport institutions;and (f) strengtheningof air pollutioncontrol policy and institutions. Assistance would also be provided for the preparationof future integratedurban infrastructureprojects in Jabotabekand other large cities (US$3.3million; 1%). Terms of reference for the various assignmentsare outlined in Annex 5, Attachment 1.

Jabotabek Expenditure Planning and Programming

2.6 Integrated Urban Infrastructure Programmiag. GOI has adopted a policy of integratedinvestment programming as a preconditionfor Central Government support for local governmentdevelopment (para 1.05). GOI will expand the current Jabotabek planning and programing coordinationarrangements to undertakethe preparationof a five-yearexpenditure program and annual programs for the JabotabekLevel I and II local governmentareas during FY89/90-93/94in line with Tim Koordinasi IUIDP guidelinesand Lhe RUTR Daerah 2005 master plan for DKI and structureplan for Jabotabek.The process to be followed is described in Annex 1 and illustratedin Chart 2.

2.7 Advisory services included in the project would be provided by MHA's - 17 -

DirectorateGeneral for Regional Development(DG Bangda) to BAPPEDAs of West Java Provinceand DKI to help prepare the 5-year expenditureprogram and initialannual program, financingplans and revenue improvementplans. The work would also includethe formulationand implementationof appropriate environmentalprotection regulations and enforcementmeasures for the environmentally-sensitiveareas in DKI and West Java lying to the south of Jakarta. Outline terms of referenceare given in Annex 5. Full TOR were prepared for negotiationsby DG Bangda in collaborationwith DC Cipta Karya assisted by UNCHS/UNDP IUIDP Support Project (INS/85/005)and under the guidanceof Tim Koordinasi. The Jabotabekplanning and programmingprocess arrangementswere confirmedat negotiationsand, GOI would enable and cause the agencies concernedto carry out the preparation of and adopt by March 31, 1989 an integrated5-year expenditureprogram and related first annual program for Jabotabek (DKI-Jakarta,West Java Province and KabupatensBogor, Bekasi and Tangerang,and KotamadyaBogor) satisfactoryto the Bank. ThereafterGOI shall, in consultationwith the Bank, prepare the subsequent annual programs.

2.8 DKI-JakartaRevenue Improvement. The GOI's objective of strengtheninglocal government (as contained in the Statementof Policies for Urban Development,para. 1.2) includes the strengtheningof local government revenuesto help meet the growingburden of urban infrastructurefinancing. GOI has begun to address this under the PBB ImprovementProject being implementedby the Ministry of Finance'sDirectorate General of Taxation (DC Pajak) and assisted by the Loan 2816-IND. DKI, as the local authoritywith the greatest revenue potential,will be a major beneficiaryof the PBB program to be implementedduring the next two years. It is expected thereforethat DKI's revenueswill show a significantincrease over the next few years, and its dependenceon Central Governmentgrants will decline as discussed in Chapter 5. DKI's revenue potentiallies chiefly in the assigned PBB tax and in some of its direct routine revenues. Action plans (paras 5.7 and 5.10) have been designed to facilitatea significantincrease in DKI revenues over the next few years in order to support DKI's expected developmentneeds as will be reflected in the forthcomingfive-year expenditure program (para. 4.3). DKI's financialmanagement would be strengthenedunder the action program also.

2.9 Assistancewould be provided to (a) DKI-Jakarta'sDinas Pendepatan (RevenueDepartment) to (i) improve tax administration(identification and registration,assessment, and billing and collections),and (ii) support the ongoing DG Pajak program for implementationof the PBB property tax; and (b) BAPPEDAto improvefinancial management, in supportof the revenue improvementaction plans. Outline terms of referenceare given in Annex 5.

Urban TransportAction Plan

2.10 Recent studies estimate that person-tripsin the Jabotabek area will double during the 20-year lifetime of the current master plan to about 24 million/dayfrom their present level of about 12 million. Current initiatives in railway, bus and traffic solutionsare proceedingmore or less indepen- dently and in sum offer an ineffectiveand unaffordablesolution (para 1.15). The projectwould attempt to lay the groundworkfor an integratedmulti-modal solutionbased on a three pronged approach consistingof (a) strengtheningthe subsectorcoordination and policy/planningframework; (b) preparationof an - 18 -

integratedurban transportdevelopment program; and (c) implementingsubsidi- ary action plans aimed at improvingthe performanceof all modes. The draft Urban Transport DevelopmentAction Plan agreed at negotiationsintended to accomplish these objectivesis summarized in Annex 2, and would reflect various subsidiaryaction plans, as describedbelow.

2.11 Urban TransportPolicy and Program Coordination. The significance of the role of urban transport in efficienturban managementas well as its large investmentand OEM needs warrant close attentionby TKPP. In order to better coordinateurban transportpolicies and related intersectoralpolicies as well as urban transportinvestment programs TKPP has recently been strengthenedthrough formalization of the membershipof the key agencies concernedwith urban traffic and transportation,DC Land Transport (DGLT) and DC Bina Marga (DGBM). Representativesof DGLT and DGBM are now included in TKPP's standing committeesand an urban transportworking group has been formed (see Chart 1). As a conditionof effectivenessTKPP would adopt an Urban TransportDevelopment Action Plan (para 2.10) satisfactoryto the Bank.

2.12 IntermodalPlanning. An integratedurban transport plan for the future of Jabotabekwould seek to optimize the comparativeadvantages of the differentmodes (privateand public--busesand rail) and their infrastructure requirementsin a least-cost,viabl3 solution. Such a solutionwould undoubtedlyinclude a new mass transitcomponent, as well as seek to achieve efficiencyin conventionalexisting systems. Separate rights-of-way(mainly within existing ROWs) will be required since Jakarta'smixed traffic roads will not otherwisepermit a mass transit solutiondue to unavoidableconges- tion. This approach is more fully described in Annex 2. Assuranceswere obtainedat negotiationsthat GOI would cause DKI-Jakarta'sDinas LLAJR under the joint supervisionof DKI and West Java Bappedas,DGBM and DGLT and the guidanceof TKPP to carry out: (a) a review (based on availabledata), of projectedtransport demand and existing modal capacitiesand roles, and identifya transportcorridor network together with policies and plans for an integratedtransport system includingmass transit options, and discuss the options and proposalswith the Bank by March 31, 1990; and (b) in collaboration with the agencies concerned (includingPJKA and PPD) detailed action plans for bus, rail and other modes to be discussedwith the Bank by March 31, 1991. Outline terms of referencefor consultantsto be appointedby September30, 1988 to assist DLLAJR in this task are given in Annex 5.

2.13 JabotabekRailway. The current proposalsfor Jabotabekrailway development(para 1.15) indicate that project will not serve a useful mass transit function but will be limitedmainly to serving commuter traffic betweenBotabek and Jakarta. These trips will likely constituteabout 2-3% of total Jabotabektrip demand in 2005. As part of the integratedurban transport planning effort (para 2.12) the role of the Jabotabek railway and its currentdevelopment would be evaluated. An action plan for an appropriate railway investmentprogram and operationalimprovements intended to maximize revenuesand minimize investmentand operatingcosts is expected to result from these studiesand the parallel work being carried out under the recently approvedRailway TechnicalAssistance Loan (Ln. 2891-IND).

2.14 Bus Transport. The choice of mass transit technologyand its staging (buses, trolleys,trains) will be an importantstep, but in any event the current conditionof the Jabotabek public bus operationsof PPD, if - 19 - allowed to persist,would not only inhibit an importantoption but also likely result in an inadequateconventional service. Irmediateaction is needed to restructurePPD's systemsand operationsin order to provide an effectiveand viable large bus service in Jakarta (para 1.16). A similar situationexists, although to a considerablylesser degree in DAMRI operationsin regional cities. An agreed Bus TransportAction Plan of measures for (a) restructuring of PPD and (b) assistanceto DAMRI, has been prepared and discussedwith the agencies concernedand is contained in Annex 3. Related actions by DCLT and DKI's DLLAJR to strengthenregulation of public transportand improve licensingterms and arrangementsare also discussed in Annex 3. At negotiations assuranceswere obtained that GOI would cause the agencies concerned to implementwith the assistanceof consultantsa PPD/DAMRITransport Action Plan and timetablesatisfactory to the Bank.

2.15 Agreed terms of referencefor the consultingassistance to (a) PPD and DAMRI; (b) Dinas LLAJR (togetherwith strengtheningits urban transport planning and trafficmanagement and engineeringcapacity--para 2.16); and (c) DGLT are outlined in Annex 5, Attachment1.

Road Planning and Traffic Management

2.16 Effectiveroad network planning and traffic managementhave been hampered in the past due to weaknessesin organizationand skills in the agencies responsible. Responsibilitieshave been clarifiedand Dinas LLAJR in DKI is being strengthenedthrough reorganizationand recruitmentof staff to address transportplanning and trafficmanagement and engineering,as well as public transportplanning and regulation(para 1.20). The project would support the strengtheningof Dinas LLAJR through the provisionof the consult- ing assistancementioned above (para 2.15) to address traffic restraint policies,traffic engineeringmeasures, public transport planningand regulation (see Annex 2 for DLLAJR's trafficmanagement action plan and Annex 3 for its public transportaction plan). Formal training of new entrants would occur through the DGLT training collegeat Bekasi (para 2.23).

2.17 An importantadjunct to traffic managementis of course traffic regulationenforcement. In order to strengthenenforcement in Jakarta and other cities, and improveunderstanding of trAffic managementand engineering principles,assistance would be provided to the National Traffic Police Training College at Serpong for trainingand equipment (para 2.23).

Roads O&M

2.18 O&M of primary roads in DKI is reads ably well provided for but local roads have received less than optimal attention. Moreover,many roads provided by the private sector are often not recorded as part of DKI's inventoryand suffer premature deterioration. The project would support incrementalexpenditures in O&M to be focussed on a planned local roads maintenanceprogram, based on an O&M planning system developed by the Ministry of Rome Affairs for local governmentusage (para 1.21). Assistancewc,uld be provided to DKI's Dinas PU in installingand operating the MHA system in one of the City's five road maintenanceunits and in advising DKI on appropriate hand-overpolicies for privately funded infrastructure.Agreed terms of referenceare outlined in Annex 5. - 20 -

Air PollutionMonitoring

2.19 As a result of reduced congestion,better bus flows and bus engine maintenancethe project is expected to contribute to a lesseningof motor vehicleemission-related air pollution.In parallel,a comprehensiveapproach to avoiding and controllingair pollution is being followed by GOI including better spatial planning and recent initiativesto reduce lead content in its motor fuels and improve engine technologyand maintenance.In order to better addressand quantify Jakarta'sgrowing air pollutionproblems the present system of fixed and mobile air quality monitoring stationsmaintained by the MeteorologicalBureau (BMG) and DKI's Center for Urban Research (P4L) would be improvedand extended and impact monitoring by the Ministry of Health (Annex 10). The project would includeadvisory services to these agencies for the upgradingof the existing system, provisionof monitoringequipment, and training in analyticaltechniques and interpretattnn. An outline of the agreed terms of reference is given in Annex 5,

Future Project Preparation

2.20 Engineeringand advisory serviceswill also be provided to: (a) prepare future integratedurban infrastructureprojects in other metropolitanand large cities (as currentlyunder study with assistance from Loans 1972, 2408 and 2236-IND),and study the feasibilityand appropriate developmentmanagement arrangements for the KemayoranAirport Site development (para 2.04), and (b) study the feasibilityand prepare a project for a possiblemass transit system in Jabotabek(para 2.12). Terms of reference would be prepared by MPW's DirectorateGeneral Cipta Karya and DCLT respectivelyfollowing completion of the preliminarystudies.

E. Trainin'

2.21 Agencies Targeted for Development. At the National Government level, those agencies targeted for strengtheningunder the project are:

(a) the DCLT's Urban Transport Directorate(LLAK) for developmentof urban transportpolicies and technicalassistance capacity, particularlyfor Jabotabek (and for other major cities in collaborationwith LLAJR), and for operationalassistance to publicly-ownedbus companies (para 2.14);

(b) the DCLT's TransportationDirectorate (LLAJR) for developmentof vehicle emission control policy and strengtheningof air quality moni.;oringin Jakarta (para 2.19); and

(c) the National Traffic Police (SATLANTAS)for traffic law enforcement and developmentof traffic management skills (para 2.23).

2.22 Within DKI-Jakartathose agencies targeted for strengtheningare:

(a) BAPPEDA for urban infrastructureand Jabotabekurban transportation investmentprogramming (in collaborationwith West Java BAPPEDA and the JabotabekBKSP planning coordinationbody), and financial management (para 2.07); - 21 -

(b) Dinas Pendepatanfor revenue and tax administrationimprovement (para 2.08);

(d) Dinas LLAJR for transportationnetwork planning,traffic management, traffic engineeringand public transportregulation (para 2.16).

2.23 The foregoingagencies would benefit trom on-the-job training providedby the various advisors under the technicalassistance program described in SectionC above. In addition formal trainingunder the project as suomarizedbelow (US$5 million; 2% of total project costs) would provide classromtraining and instructionintended to strengthentransportation and trafficengineering education in Indonesia (detailsare given in Annex 5):

(a) Traffic EngineeringEducation. DGLT's Training College at Bekasi has developedwith assistance from Loan 2049-IND a successful training curriculumfor a three-yeartraffic engineeringdiploma. Under this project this course would be expanded and continuedand in addition,a four-yearfull degree course would be established togetherwith shorc courses in public transportationengineering. The courses would be opened to students from all levels of governmentrather than just DGLT candidatesas in the past. Campus facilitieswould be expanded slightly to accommodatethe expected increase in student intake from 40 to 100 students per year.

(b) Traffic Police Training. The project would help establish the trainingprogram of the new Traffic Police Training College at Serpong by training trainers,developing curricula and implementing new courses. About 600 students per year drawn from the 12,000 trafficpolice throughoutIndonesia would be expected to benefit from the college programs.

(c) Traffic EngineeringPractice. The training program initiatedunder Loan 2817-IND (RegionalCities Urban Transport Project)will be extended to include traffic engineeringtraining for Jakarta and Botabek cities.

F. Physical Components

2.24 Physicalworks. The project investmentswould address the current backlogof road infrastructure,traffic engineering,and road maintenanceand rehabilitationneeds of the DKI-Jakartaadministrative area. The following physicalcomponents were confirmedat negotiationsand would be implemented over a six-yearperiod from April 1988 throughMarch 1994:

(a) PrimaryArterial (National)Roads (US$29 million i.e., 13% of total project cost): constructionby DGBM of 10 km of new road links to further develop the major road network of the city;

(b) SecondaryArterial (Local) Roads (US$66.2million; 30Z): (i) constructionby DKI-Jakartaof 14 km of new road links, and (ii) togetherwith DGBH, widening or major reconstructionof 52 km of existing road links to further develop the supportingarterial road network of the city; - 22 -

(c) Major Intersections(US$23.1 million; 10%): reconstructionof four intersections(one by DGBM and three by DKI-Jakarta)through the provisionof grade separations(flyovers) to alleviate severe traffic congestion;

(d) DevelopmentRoads (US$39.4 million; 18%): constructionof about 35 km of new roads by DKI-Jakartaon the eastern and western fringesof the city and on the former KemayoranAirport site, togetherwith key infrastructure,to extend the arterial road system and to facilitate city growth and development;

(e) Traffic Management (US$27.9million; 14%): provisionby DKI-Jakarta of: (i) comprehensiveimprovements to the city main road network (includingselective repaving, drainage and geometric improvement measures)which will involve less than full road reconstruction; (ii) bus priority measures (includingbus lanes), (iii) traffic signal equipmentat about 25 intersections;(iv) improvementof individualintersections; (v) pedestrian improvements(including provisionand upgradingof footpathsalong arterial streets,and provisionof at-grade and grade-separatedstreet crossings),and (vi) a city-wide street signing and road marking program; and

(f) Road Rehabilitationand Maintenance(US$3.5 million; 2%): four-year program of routine and periodicmaintenance (includinginstitutional development).

2.25 Technicalassistance (US$12.8 million; 5% of total project cost) as follows would be provided to DCBM and DKI to assist with project implementationmanagement and accounting,final engineeringdesign and constructionsupervision (terms of referenceare outlined in Annex 5, Attachment1):

(a) to the DKI-JakartaProject CoordinationOffice (JUPCO--locatedin BAPPEDA) for overall project coordinationand project accounting;

(b) to the DKI-JakartaPublic Works Department (Dinas PU) for final engineeringdesign end constructionsupervision of DKI-Jakartaroad constructioncomponents, and for assisting in the management of the road rehabilitation/maintenanceprogram;

(c) to DKI-JakartaTraffic and TransportDepartment (Dinas LLAJR) for further preparationof traffic management schemes under the project, and for administeringon-going traffic management programs;and

(d) to DGBM for final engineeringdesign and constructionsupervision. - 23 -

III. PROJECT COSTS AND FINANCING

A. Project Costs

3.1 The total project cost as shown in Table 3.1 below is estimatedto be about Rp 370 billion (US$224million equivalent),including estimated direct and indirect foreign exchange costs componentof about Rp 176 billion (US$106million equivalent)or about 47% of total, and estimatedtaxes equivalentto about Rp 16 billion (US$10 million). Base costs are estimated as of January 1988. Physical contingencieshave been estimatedat 7.5Z for civil works and equipment. Price contingenciesare estimatedat 10% for 1987, 5% for 1988, and 3.5% in 1989 and thereafteron domestic costs, and at 3.0% in 1987, 1% in 1988 through 1990, and 3.5% in 1991 and thereafteron foreign costs. Price contingenciestotal Rp 24 billion (US$14.3million equivalent) or 7Z of total base costs plus physical contingencies. Land acquisitioncosts estimatedat about US$31 million are included in the base costs. Detailed cost estimatesare given in Annex 6.

Table 3.1: ESTIMATEDPROJECT COSTS

Component Local Foreign Total Z Local Foreign Total Z -- US$ million -- foreign ---Rp billion ---- total

Arterial roads and intersections 60.4 43.7 104.1 42 99.6 72.1 171.7 52 Developmentroads 21.2 13.3 34.5 38 35.0 21.9 56.9 17

Traffic management 13.2 14.7 27.9 53 21.8 24.2 46.0 14

Road maintenance 1.7 1.8 3.5 52 2.8 3.0 5.8 2

Training 1.4 3.6 5.0 73 2.3 6.0 8.3 3

Tech. assistance 9.0 15.8 24.8 64 14.9 26.1 40.9 12

Base cost (1/88) 106.9 92.9 199.8 47 176.3 153.5 329.6 100

Physicalcont. 4.4 5.4 9.9 55 7.3 9.0 16.3 5 Price cont. 6.4 7.9 14.3 55 10.6 13.0 23.6 7

Total project cost/a 117.7 106.2 223.9 47 194.3 175.2 369.5 112

/a Includingestimated taxes US$10 million equivalent. - 24 -

3.2 Cost estimatesare based on (a) detailed engineeringdesigns for 30X of the road constructioncomponents and preliminaryengineering designs for all remainingcivil works components(except those minor traffic engineering and road rehabilitationworks which will be developedon an annual program- matic basis); and (b) the prices of technicalassistance contracts executed in 1987-88. Detailed designs and tender documents for componentsto be implemented during the first year of the project are mostly complete. Costs for advisory services in supportof institutionaland policy development,project implementation,and future project preparation are estimatedto total US$24.8 million, comprisedof about 240 man-years of local consultantsand about 80 man-yearsof foreign consultants.

B. FinancingPlan

3.3 Project Financing. The proposed Bank loan of US$150.0million would contributeabout 67X of the total project cost, or 70Z of the project cost net of identifiabletaxes and duties. The loan would cover the entire foreign exchange costs estimatedat about US$106 million and local costs of US$44 million equivalent. Counterpartfunds would be provided by Central Government (US$27million) and by DKI-Jakarta(US$47 million) as shown in Table 3.2 below. Table 3.2: FINANCINGPLAN

Source Local Foreign Total ---US$ million ----

Central Government 27.0 27.0 DKI-Jakarta 46.9 46.9 IBRD 43.8 106.2 150.0

Total 117.7 106.2 223.9

3.4 Flow of Funds. For componentsimplemented by DKI-Jakarta,Bank loan proceeds totallingUS$89 million will be on-lent under a subsidiaryloan agreement.The on-lent funds will finance about 65Z of the total DKI-Jakarta components,with the remainder(US$46.9 million equivalent)coming from DKI- Jakarta revenues. For componentsimplemented by DGBM and DGLT, part of the Bank loan proceeds (about US$61 million) and governmenL funds totallingUS$27 million would flow as CentralGovernment contributions. A detailed financing plan is shown in Annex 8.

3.5 On-lendingTerms. GOI would bear the foreign exchange risk, and will absorb the interestrate variation on the proceeds on-lent to DKI-Jakarta at a fixed interest rate of 101 per annum. DKI-Jakartawould pay the commit- ment fee on the portion of the total loan amount allocatedfor its components under the project. The on-lendingperiod would be the same as for the Bank loan to the Government,i.e., for 20 years wich 5 years grace. Confirmation - 25 - of the main term and conditionsof the subsidiaryloan agreementbetween the Governmentand DKI-Jakartawas obtained during negotiations. The foreign exchange risk vill be borne by the Government. Executionof a subsidiaryloan agreementbetween the Borrower and DKI-Jakartasatisfactory to the Bank would be a conditionof effectivenessof the Bank loan. - 26 -

IV. PROJECTORGANIZATION AND MANAGEMENT

A. ImplementationArrangements

4.1 The project would be executed principallyby DGLT, DGBM and DKI- Jakarta. Certainminor componentswill be executed by DG Bangda and DG Cipta Karya. All physicalcomponents under the project will be implementedby DKI- Jakarta and Bina Marga.

4.2 Project Coordinationand Monitoring. DKI-Jakartawill be responsible for the overall project coordinationand monitoring,and will establish and staff a Project CoordinationOffice (JUPCO)under DKI's BAPPEDA for this purpose. JUPCO will also be responsiblefor overallmanagement and control of all project componentsto be implementedby DKI-Jakarta. (These components represent,in aggregateabout 60% of the total project cost and 70% of civil works to be implementedunder the project). The ProjectManagement Unit which was establishedunder the Urban Roads Planning Directorateof DGBM for preparation and management of the Regional Cities Urban TransportProject (Loan 2817-IND),will be strengthenedto take responsibilityfor the coordinationof all DGBM project components,and for oversightof the project physical componentsoverall. This office will also provide support to DKI-Jakartaas requested. (See Chart 3 for an overview of the project organizational structure).

4.3 JUPCO would consolidateinformation from the various project implementationunits and prepare quarterlyreports on project progress (procurement,construction, financial and institutional)in Bahasa Indonesia. Suammariesof the quarterly report in English would be prepared for transmittalto the Bank. The report would be submittedthrough DGBM's Urban Roads Planning Directoratewhich would review physical progress and assist in resolvingproblems encounteredwith major structures. JUPCO would also arrange for the preparationof consolidatedproject account statementsfor annual auditing purposes. Consultantswould be appointedto assist and advise JUPCO in overall project coordinationand monitoringof implementationand project accounting. JUPCO would be responsiblefor preparationof the Project CompletionReport.

4.4 Implementation. Each project executionagency will establishand staff project managementand implementationunits to be responsiblefor the managementand execution of their respectiveprojects as follows:

(a) DKI-Bappedawill be responsiblefor hiring of all technical assistancerequired by BAPPEDA and coordinatingall other technical assistancerequired by DKI for the purposes of the project. DKI's Dinas PU will be responsiblefor procurementand supervisionof all DKI componentcivil works, and goods and carrying out works by force account other than traffic engineeringworks. DKI's Dinas LLAJR would be responsiblefor procurementand supervisionof civil works and goods relating to traffic engineeringimprovements. - 27 -

(b) DGBM's DirectoratePJK will be responsiblefor hiring of all technicalassistance and for procurementand supervisionof all civil works and goods related to the DGBM component.

(c) DGLT's Directorateof Urban Traffic and Transport (LLAK) will be responsiblefor the procurementof all technicalassistance, training activitiesand works for the DGLT component.

(d) DGBangda will be responsiblefor procuringthe Jabotabek IUIDP advisory assistanceand DG Cipta Karya will be responsiblefor procuringthe Kemayoran Site developmentand the Metropolitan/Large Cities IUIDP assistance.

4.5 The abovementionedarrangements were confirmedat loan negotiations. Agreed terms of referencefor the assistanceto JUPCO for project coordination,and to Dinas PU and DGBM for assistancewith final engineeringdesign and constructionsupervision are outlined in Annex 5. Assuranceswere obtained from GOI at negotiationsthat the JUPCO consultants would be appointed by June 30, 1988.

B. ImplementingAgencies

DKI-Jakarta

4.6 The Public Works Department (Dinas PU). rhe Department is organized and adequatelystaffed to implementDKI-Jakarta's Rp 55 billion annual public works program. The project, however, would increasethe annual roads portion of Dinas PU's program about 50% during the life of the project and, thus, a modest amount of technicalassistance for constructionmanagement and supervisionwill be provided (para 2.6). Technicalassistance will also be provided to strengthenmaintenance planning (para 2.20).

National Agencies

4.7 DirectorateGeneral Bina Marga. DGBM is responsiblefor the planning, constructionand maintenanceof the national road network except for secondaryand local roads in municipalareas. The organizationis divided into six Directorates: Planning,Urban Roads, three regional implementation directorates,and an EquipmentDirectorate. Approximately8,000 personnelare employed by Bina Marga, of whom 4,000 are permanentemployees. Of these, approximately1,500 hold professionalqualifications and about 1,000 are engineers. Despite significantstaff increasesover recent years and substantialtraining efforts, there is still a recognizedshortage of qualifiedpersonnel. DGBM's policy in these circumstancesis to make use of consultantsto fill gaps in key tasks such as constructionsupervision.

4.08 DGBM's Urban Roads Directoratewill, under this project, assume responsibilitiesunder its second Bank-fundedproject. The Directoratewas set up in 1984 to respond to the growing problems in the urban transport sector, is organized into three regionaldivisions and a research division. The regional divisions of the Directorateare responsiblefor planning, design, and monitoring of DGBM's urban investmentprogram and the provisionof technicaladvice to cities. - 28 -

4.09 DirectorateGeneral of Land Transport (DGLT) is responsiblefor oversight and planning of the land transportsector includingroad traffic and transport,ferries and inland waterways,and the technicalsupervision of the State Railways Corporationand the two state-ownedbus companiesPPD and DA41I. The SecretariateDGLT and DirectoratesLLAJR (HighwayTraffic and Transport)and LLAK (Urban Traffic and Transport)have the main responsibilities in DCLT in regard to urban transportmatters. In practice LLAJR influence is better establishedin relation to Regional Cities, and Jabotabekmat- ters have been the main focus of LLAK since its formationin 1980. The Secre- tariate'srole at present (in the absence of appropriatecapacity in the SecretaryGeneral's Office in MOC), includes the coordinationof different land transportmodal plans. LLAK as an etmergingforce in urban transport, suffers from weak staffing and lack of experience,as well as unclear defiy7 tion of its role vis-a-visDGBM in trafficand transportplanning matters.- The project would provide assistance to LLAK for developmentof its public transport planning and regulationfunctions as well as address the operational problems of PPD and DAMRI in accordancewith an Action Plan of measures based on the recommendationsof the National Public Transport Study (paras. 2.14- 2.16).

C. ImplementationSchedule

4.10 The project would be implementedover a six year period, April 1988 through March 1994 in accordancewith the implementationschedule shown in Annex 6, Table 2. Detailed engineeringand tender documentshave been completed for all road components to be implementedduring the first year of the project. Related land acquisition(para 4.19) is proceedingsatisfactorily. The tendering process for the first set of contractswill begin during early 1988 and contract awards are expected during April/May 1988.

D. Procurementand Disbursement

Procurement

4.11 Civil Works. The estimated total value of civil works under the project is about US$155 million includingcontingencies. Larger contracts (over US$3.0 million each) for road constructionand corridor improvements, totallingabout US$60 million, will be procured followinginternational

10/ In the GOI Urban Sector Policy Action Plan agreed under Loan 2816-IND, (Uroan Sector Loan) Tim Koordinasi is examiningthe respectiveroles of DGBM and DGLT and is expected to recommendassigning primary responsibilitiesas follows: (a) for traffic engineeringand management local governmentswould be assigned responsibilityfollowing development of their capacity; (b) at the national level DGBM would be assigned sole responsibilityfor developmentof standardsfor traffic management,road capacity improvementand the provision of traffic control and regulatory devices; and (c) DGLT would take full responsibilityfor public transport planning and regulation and graduallydevolve this function to local governments. - 29 -

competitivebidding (ICB) proceduresconsistent with Bank guidelines. Minor contracts totallingabout US$95 million not likely to interest foreign bidders would be procured through local competitivebidding (LCB) in accordancewith procedures satisfactoryto tne Bank. (See Annex 7 for further details on contract packaging). Foreign contractorswould be eligible to bid on contracts to be awarded under LCB procedures. About US$1.8 million for trafffic engineering improveme nts costing less than about US$5,000 each will be executed by the DKI-Jakartaforce account. These works are not suitable for private con- tractors due to the difficulty in specifyingthe work to be performed.

4.12 Equipmnt. Traffic signal and other related equipment totallitg about US$4.1 million equivalent in contractsexceeding US$200,000 value, 'iill be procured under ICB proceduresin acccordancewith Bank guidelines. Quali- fying domestic manufacturerswill receive a preferencein bid evaluationof 15% or the import duty, whichever is less. Miscellaneousgoods costing less than US$20,000 equivalentand totallingnot more than US$1 million may be procured by prudent local shopping.

4.13 Procurementarrangements for the project are summarizedin Table 4.1 below: Table 4.1: PROCUREMENTARRANGEMENTS

Expenditurecategory Procurementprocedure ICB LCB Other N.A. Total

Civil works 59.3 93.4 1.8 154.5 (44.7) (74.5) (1.3)/a (120.5)

Equipment 4.1 1.0 5.1 (4.0) (1.0) (5.0)

Technical assistanceand training 24.5 24.5 (24.5) (24.5)

Land and taxes 39.8 39.8 (0.0) (0.0)

Total 63.5 94.4 26.3 39.8 223.9 (48.7) (75.5) (25.8) T(0.) (150.0)

/a Force account works for minor traffic engineeringimprovements.

Note: Amounts in parenthesesare the respectiveamounts financed by the Bank. - 30 -

4.14 ProcurementReviews. Bidding documents for all civil works contracts exceedingUS$1 million equivalent in value and equipmentcontracts exceeding US$500,000 in value (representingabout 60% of the total value of procurement)would be subject to prior review by the Bank. The balance of contracts for goods and civil works will be subject to random post-reviewby the Bank. A unit price analysis with supportingdocuments will be submitted for Bank review before the first reimbursementfor force account works is claimed. Contractorsfor major civil and structuralworks would be prequa- lified in accordancewith proceduressatisfactory to the Bank. All technical assistancewould be procured in accordancewith Bank guidelinesand all technical assistancecontracts will be subject to the Bank's prior review. All proposed direct appointmentswould be subject to prior review by the Bank. A summary of review proceduresis given in Annex 7.

Disbursement

4.15 Bank loan disbursementswould be made against the followingcate- gories of expenditures:

(a) 75Z of the cost of civil works executed under contract by DGBM and DGLT;

(b) 75% of the cost of civil works and traffic engineeringworks and 100% of maintenanceexecuted under contract and by force account by DKI;

(c) 100% of the CIF cost of directly imported goods, 95% of ex-factory costs of locally manufacturedgoods and 65% of importedgoods procured locally; and

(d) 100% of the costs of technicalassistance and training-related expenditures.

4.16 Tn order to facilitatedisbursements, a SpecialAccount would be opened in Bank Indonesiafor the purposes of the project by the Ministry of Finance. The use of the Special Account would be limited by GOI (in terms of present regulations)to withdrawalsrelating to expenditureson contractspaid wholly in local currency.This category is expected to include almost all civil works under the project totallingabout Rp 255 billion (US$155million equivalent).The account would be maintained in US$ and an initialdeposit of US$6 million (equivalentto expected average disbursementsduring a four-month period)would be made. Witbdrawalswould be made on the basis of (a) SPMs (Orders-to-Payin respect of APBN DIP expenditures)or (b) SPMLKs (Orders-to- Pay in respect of loan-fundedexpenditures by DKI) issued by the MOF's Directorateof Budget Administration(TUA) for eligible projectexpenditures, and (c) debit advices issued by Bank Indonesia.

4.17 At the initiativeof GOI, replenishmentsof the Special Account would be made monthly or whenever the balance reaches 50% of the initial deposit amount, whicheveroccurs first. The estimatedreplenishment schedule and related disbursementschedule is shown in Annex 8, Table 2. Replenishmentswould be made on the basis of Statementsof Expenditure(SOE) - 31 - proceduressatisfactory to the Bank or, in the case of expendit.resrelated to contracts procured under ICB procedures,full documentation. Supporting docuL.entationfor the SOEs would be maintainedby TUA and DKI's Project CoordinationOffice (JUPCO). Disbursementsagainst expendituresin respect of contracts involvingforeign currency payments would be made followingIBRD direct paymentwithdrawal procedures.

4.18 The proposed disbursementperiod of 7 years is consistentwith the disbursementprofile for the urban sector in Indonesia. This schedule is con- sidered reasonablesince project preparation,including detailed engineering and land acquisition,is well advanced. Due to the expected commencementof implementationas from April 1, 1988 prior to loan signing,the Bank would retroactivelyfinance eligible expendituresincurred after March 31, 1988 up to a maximum of about US$5 million. The loan closing date would be March 31, 1995.

E. Land Acquisition

4.19 Land acquisitionunder the project is substantial,involving acquisition for road widening in well developed areas, and for new roads on the developingurban fringes of the city. The total land acquisitioncost (estimated at US$30 million) representsnearly 13% of the total project cost and affects road constructionand traffic managementcomponents representing approximately68Z of the total project cost. Approximately250 ha of land alongsideexisting rights-of-wayneeds to be acquired to accommodatethe road constructioncomponents under the project. About 80 ha related to the western guided land developmentwould be acquired by DKI-Jakartaunder agreementswith private developersthat will provide for thevreimbursenent of DKI's costs. The resettlementaspects of the land acquisitionprogram are discussed in para. 6.9. To reduce the risk that delays in land acquisitionwill adversely affect project implementation,the project implementationschedule has been phased in stages to take into account the time it will take to assemble the land. All needed propertieswould be acquired during the budget year prior to the implementationof the componentconcerned in accordancewith well established procedures. Assuranceswere obtained at negotiationsthat land acquisition and resettlementrequired will be carried out in accordancewith a plan and implementationschedule satisfactoryto the Bank.

F. Accounts and Audits

4.20 JUPCO as the lead project coordinationunit (para. 4.2), will have overall responsibilityfor establishingand monitoringthe use of a uniform project accountingsystem. Subprojectfinancial records arn accounts will be maintainedby JUPCO based on copies of financialand supportingdocuments obtained from the agency project managers and relevant external agencies concerned with project funding, payment and reimbursement. JUPCO would transmit to the Bank on at least a quarterlybasis up-to-datesubproject account recor1s consolidatedinto a single project account for monitoring purposes and annually for audit purposes. The audit statementswould deal with the Central, and DKI-Jakartagovernment funds provided as well as disbursements by the Bank, and would includeopinions on all expendituresincluding those made against Statementsof Expenditure. While the accountingand auditing - 32 - approachoutlined above is agreedto in principle,no staffhave been appointedto date to establishan operatingsystem. Accountantswould be appointedas part of the advisoryassistance to JUPCO(para 2.6). Assurances were obtainedat negotiationsthat (a) the consolidatedproject account, includingdocumentation on Statementsof Expenditure#will be auditedannually in a timelyfashion by independentauditors acceptable to the Bank,and (b) DKI-Jakartawill submitannually to the Bank certifiedcopies of the auditedproject account no laterthan nine monthsafter the end of each fiscal year co_eencing in FY88189. - 33 -

V. FINANCIALANALYSIS OF DKI-JAKARTA

A. Current FinancialCondition of DKI-Jakarta

5.1 National Overview. Overall regionalgovernment expenditures grew during Repelita III at over 25% p.a. on average (chieflydue to the influence of the INPRES program). Total expenditureby regional governmentsduring Repelita III was about Rp 13.5 billion, representingabout 5% of GDP. The proportionspent on urban infrastructureand services was about 5%. Unless there is some major reorderingof priorities,local governmentsmust mobilize more revenue in order to sustain even presentexpenditure levels much less provide for future growth (para 1.3). The sourcesof finance for Level I and II regional governmentsare: (a) central governmentgrants (includingDIP grants administeredby central governmentdepartments and INPRES and SDO grants channelledfor developmentand routineexpenditures respectively); (b) assigned revenues,levied by central governmentbut assigned wholly or in part to regional government (e.g. property tax (PBB) revenues); (c) revenue from local taxes and service charges, includingrevenues of local enterprises and servicedepartments; and (d) loay!Lto regional governmentsand enterprises (from domestic and foreign sources)."' There is no single comprehensive source of informationon regional governmentfinance but consolidated accounts' prepared by Bank staff indicatethat total revenues of local governmentsin 1983/84 (not includinggrants through the developmentbudgets (DIPs) of ministerialline agencies)was Rp 3.9 trillion,comprised 75Z of central governmentgrants (consistingof 53% routine and 47% development grants), 13% local taxes and charges, 3.5% PBB, 0.8% loans and 7% others. The role of grant finance as a proportionof regional governmentrevenue has been growing but this trend clearly must change in the light of the recent fall in central government revenues.

5.2 DKI-Jakartais a unique Level I local government (Province)with revenues and expenditurestypical of both a city and a province. The fiscal base of DKI-Jakartais stronger than that of other cities in the country. Its per capita resources for example, are more than three times those of Surabaya. As shown in Annex 9, Table 1, in the last six years (GOI's FY81/82-FY86/87), despite uneven performancein individualcategories of receipts, its total resourceshave almost doubled from Rp 217 billion to Rp 409 billion, representing an average annual growth rate of almost 14% in nominal terms or some

11/ Local enterpriseaccounts (e.g. water enterprises)are maintained separatelyand do not figure in local governmentaccounts other than in the form of transfers to the enterprisesas equity or routine budget support or from the enterprisesas profit sharing. The various sources and their trends and characteristicsand recommendationsfor strengtheningof local governmentfinances are discussed in a racent sector study of local government financecarried out as part of a forthcomingBank review of public resource management in Indonesia (Report No. 7007-IND). Several of the recommendationsare under implementationwith assistance from Loan 2816-IND. - 34 -

42 in real terms during this period. While part of the increaseresulted from larger transfers from the Central Government(i.e. SDO routine salary grants), self-generatedrevenues have also increasedsteadily overall, at an annual average rate of 13X in nominal terms (about 31 in real terms) during FY81/82- 86/87, comprising522 of its total resourcesper capita in FY86/87. This was mainly through the performanceof servicecharges which grew at over 162 p.a. during this time. Local taxes, however,showed no growth in real terms during this perioddespite a growth in GRDP of over 10X p.a. DKI-Jakartais relatively less reliant than other Indonesiancities on central governmentbudge- tary support for both routineand developmentexpenditures but, as indicated in the,211lowingTable 5.1, Jakarta receivesconsiderably more in per capita terms.-

Table 5.1: FISCAL BASES OF DKI-JAKARTAAND OTHER REGIONALCITIES IN FY85/86

Expenditures Resources Per-capita Revenues Population as X of City 1985/86 Routine Dev't Total Local Central Loans Revn. Res. resources (million) ------Rp billion ------Rp'000

DKI 6.85 178 231 409 213 185 12 31 60 52

Surabaya 2.25 19 17 36 19 13 4 8 16 53 Bandung 1.64 15 11 26 12 13 2 7 16 45 Medan 1.64 11 17 28 10 6 12 6 17 36 Semarang 1.32 10 15 25 8 13 4 6 19 33

Total 13.70 233 291 524 262 230 34 19 38 50

5.3 Developmentfunds derived from DKI-Jakarta'soywl resources (i.e., excludingassigned taxes (Ipeda/PBB)and InpresDate II)_ and transferred from the routine budget, increasedby 11. p.a. in nominal terms from Rp 80 billionin FY81/82 to Rp 146 billion in FY86/87,representing 682 of the city's developmentfunds in the latter year. Central governmentdevelopment

12/ The inclusionof ministerialline agency developmentexpenditures in Jakarta (excludedfrom this analysisof DKI's fiscal capacity)influences this indicatorsignificantly. If the bus and railway expendituresdis- cussed in par&. 1.7 are taken into account per capita expendituresby Central Governmentin Jakarta exceed Rp 160,000--severalfoldthe national average.

13/ Inpres Dati II is allocatedto DKI's Level II local governments(about Rp 60 billion in 1986/87)and is not regardedas a Level I development revenue for the purposesof this discussion. - 35 - grants in the same year (Inpres Dati I) contributed5% of total development funds. Although revenues from property taxes (Ipeda/PBB)increased at a rapid annual average rate of 23% during FY81/82-84/85to Rp 16.6 billion, they declined during the next year by -39Z as the new PBB tax was late in commencing. Nevertheless,PBB receipts recovered stronglyin FY86/87 to Rp 27.5 billion to contribute7Z of total developmentrevenues. Substantialassigned revenues are expected when the property tax (PBB) becomes fully operational (para. 5.8). Developmentfunds in FY86/87actually declined thereforefrom their high point in FY84/85 of Rp 239 billion to Rp 215 billion. Moreover, the developmentfunds include DKI-Jakarta'sborrowings which have increased considerablysince FY84/85. The contributionof loans to developmentfunds increasedfrom 1% in FY82/83 and 83/84 to 6% in FY84/85.

5.4 Routine expenditureshave grown steadilyby almost 14% p.a. during 1982/83 to 86/87 from Rp 91.5 billion in FY81/82 to Rp 195 billion in FY86/87. Personnel costc account for 60% of routine expenditures(funded mainly by the SDO grant), and materialsand repairs for 31%. During the last two years routine expendituresbuoyed by grant support increasedfaster than direct routine revenues giving some cause for concern. The overall growth of developmentexpenditures is fairly consistent with the growth of its development funds. Patterns in subsectorexpenditures were quite uneven during this period but transportation(18%) and education(15Z) were the most important subsectorsoverall. The largest portion of developmentfunds in FY85/86 was allocatedto the rehabilitationand new constructionof urban roads and bridges which representedabout 19% of the city's total budget, followed by education sector expenditures(15%), market development(12%) and health, includingwater supply and sanitation(10%). Unlike smaller cities, DKI- Jakarta finances its developmentprojects (as distinct from Central Government projects implementedwithout substantiveDKI participation),largely from its own resources. In FY86/87 nearly 70% of total developmentexpenditures were financed from its own revenues (includingassigned taxes and borrowings),and the remaindercame from Central Government,mainly through Inpres grant allocations.

B. Project Impact on DKI-JakartaFinances

5.5 Ten-year budgetaryprojections for DKI-Jakartaare presented in Annex 9, Table 2. These estimates are subject to modificationas a result of the forthcomingJabotabek expenditure program preparation(para 2.9) but for present purposes assume the following: (a) Central Governmentgrants for DKI- Jakarta would, in the case of INPRES remain constant in nominal terms, and in the case of SDO would increase by 8% (4% growth plus the projected4% rate of inflation)during FY87/88-95/96;(b) general recurrentexpenditures (including O&M) would increase by 8% per year in real terms; (c) general developmentex- penditureswould increase by 4% in real terms and (d) DKI-Jakartawould continue to undertake special developmentprojects, includingthe proposed project, during the next 10 years, roughly maintainingthe present distribution of developmentexpenditures among sectors. Even with conservative revenue assumptionsreflecting a reductionin Central Governmentdevelopment grants in real terms for the projectedperiod, DKI-Jakartais expected to have sufficientrevenues to support the proposed project as well as ongoing developmentprojects. Revenues from local taxes and charges are expected to increase 10% p.a. and PBB revenues 17% (para 5.07). While a substantial commitmentof its own funds will be made to the project (approximately35% of - 36 - total DKI subprojectcosts), its direct capital contributionwould be in an affordablerange, representing5% of city developmentbudgets for the next six years (FY88/89-93/94). The remainingcontribution would be covered by Bank loan funds, which woujg be on-lent by the CentralGovernment through a subsi- diary loan agreement.- The subloan would constituteabout 8% of the city's developmentbudget during the project period. DKI-Jakartawould bear the debt service burden (principleand interestat 10% per year) of the subloan with a repaymentperiod of 20 years includinga five-yeargrace period.

5.6 The borrowingcapacity of DKI-Jakartawould continue to be strong in the next 10 years. Assuming that the projectionsof revenues and expenditures indicatedin para. 5.4 above are accurate,DKI-Jakarta will be able to serve its debt obligationswithout any financialdifficulty. The projectionsindi- cate that the level of overall debt service burden, includingexisting and new loans, would be about 6% of projecteddevelopment budget during this period. This is less than one half of the conservativedebt service ceiling for regional governmentsestablished by the Ministry of Home Affairs, i.e., 15% of total developmentfunds excluding loan funds.

C. DKI-JakartaRevenue ImprovementPlan

5.7 For DKI-Jakartato afford an expandingdevelopment program of the scale assumed and at the same time meet its financialobligations, it will be necessaryat least to increase its local tax revenues by 10% per year and property tax revenues by 17% per year in nominal terms during the next 10 years. The growth rate for direct revenues is in line with historical growth rates for FY81/82-85/86when local tax revenues increasedby 13% per year. Given this recent trend in revenues and the potentialfor improvementin tax administration and collectionefficiency, increases of this order in real terms are consideredto be easily achievable. This scenario,however, does not yet fully reflect GOI's emerging urban infrastructureprogramming policies. As part of the Jabotabekfive-year expenditure program preparation(para. 2.6) the questiols of (a) DKI-Jakarta'sfunctional and financialresponsibilities; (b) central-localcost sharing and cost recovery policies; (c) CentralGovern- ment grant and loan assistanceto DKI-Jakarta;and (d) appropriateDKI-Jakarta revenue improvementstrategies, for all urban infrastructureexpenditures will be reviewed. Assuranceswere obtained at negotiationsthat DKI-Jakartawill

14/ In the future the Ministry of Finance'sRegional DevelopmentAccount (RDA) is expected to be the sole source of municipal borrowingsand is intended to lend at consistent,viable rates to cities for suitable appraisedprojects. Although establishedin 1986, its operationsunder the direction of the MOF's DirectorateGeneral of Monetary Affairs, are not yet fully developed. COI is currentlystudying RDA lending policy with assistance from the Harvard Institutefor International Development. The studies wi,l include recommendationof appropriateon- lending terms for the Bank loan funds. Consultantsfunded by UNDP to assist with operationalizationof RDA are expected to be appointed shortly and will help introduceRDA as a fully functionaloperation by FY90/91. - 37 - prepare by March 31, 1989 and implementa revenue improvementplan that shall increase DKI-Jakarta'slocal tax revenues by at least 6% per year from April 1, 1989 until the project has been completed.

5.8 A major contributionto DKI-revenuesis expected from the assigned property tax. Implementationof the new property tax during FY87/88and 88/89 by the MOF's DirectorateGeneral of Taxation is supportedby technicalassistance funded under Loan 2816-IND (Urban Sector Loan). Implementationstrategy focusses on revaluationof high-valueproperties which account for about 70% of total PBB assessments. Some 50% of these propertiesare located in Jakarta. Concurrently,improvements in the mass assessment3ystem for lower- value propertieswill also be introduced. Annual average increasesof at least 25% in total PBB revenues from the FY86/87 level of about Rp 25 billion, are targettedfor the next few years but as revalued propertiesare included in the tax roles from FY90/91 onwards,much greater increasesare expected. Much of the increasedrevenue in the medium term, perhaps some 70%, is likely to accrue to DKI-Jakartaand would form a significantproportion of its developmentrevenues.

5.9 As an assigned tax, PBB tax revenue increasesare largely governed by DC Pajak initiativesand actions in the areas of recording,identification, registration,valuation, assessment, billing and collection. Longer term efforts to improve performanceare being undertaken by DG Pajak's PBB Project in all of these areas which should result in significantincreases in revenues from 1991 onwards. In the meantime there are several actions which can be taken in the near term, with the assistanceof DKI, which would provide the basis for further improvement. DKI has importantresources in mapping and land information,as well as tax billing and collectionresponsibilities. By means of a combined DirectoratePBB/DKI effort it is expected that, without any increase in the 20% assessmentratio, the followingwould occur in the DKI administrativearea before FY94/95: (i) the coverage ratio of taxableproper- ties would be improved from 66% to 90%; (ii) the total value of registered propertieswill have risen by 60%; and (iii) the collectionratio will have improved from 40% to 70%. This would indicate a potential increase in PBB revenues from their expected 1987/88 level of Rp 33.8 billion to about Rp 227 billion in FY 1995/96--anaverage of 35% p.a. compared to the 17% p.a. targetted. The actions to be carried out (in conjunctionwith implementationof the longer term DC Pajak's PBB Project) include the following:

(a) Updating of mapping and identification:

(i) DC Pajak would assign to DKI by June 30, 1988 the role of maintainingup-to-date mapping for the DKI area's fiscal cadaster;DKI would provide such updated maps to the KIPDA; and KIPDA would use the maps promptly for tax object identification and record purposes;and

(ii) DG Pajak would obtain from DKI its recent property survey data relating to 250,000 higher-valuearea properties(about 40% of which are not currentlyon KIPDA records),and KIPDA would incorporatethe informationas appropriateinto its re-ords by December 31, 1988; - 38 -

(b) Updating of registrations: KIPDA and DKI Dinas Pendapatanwould cooperatein registrationbelore December 31, 1988 of new taxpayers identifiedby the updating process;

(c) Billing: Preparationof all tax billing will be caried out by PAIK as from January 1, 1988; KIPDA and Dinas Pendapatanwill cooperate in deliveringthe bills; and

(d) Collections: DG Pajak will introducea system permittingpayment of taxes by taxpayersdirectly to local banks. Init;ally,the system will be introducedfor Books III, IV and V taxpayers. Arrangements will be made in the system to overcome local governmentcash flow problems which may result from such direct remittances.

5.10 Confirmationof the foregoingPBB action plan was obtained at negotiationsand GOI gave assurances that it would cause DKI-Jakartaand DG Pajak to carry out jointlyan action plan such that PBB revenues from the DKI- Jakarta PBB tax area increaseby at least 13X per year in real terms on average from April 1, 1989 until the project has been completed.

5.11 The results of the PBB tax improvementare expected to benefit the larger cities in the medium term and Jakarta in particulardue to the distribution of high value propertieswhich make up the source of the majority of PBB revenues (para. 5.8). As a means of redistributingthese resourcesGOI intends to restrict developmentgrants to these larger cities which would have improved capacity to fund developmentfrom the increasedPBB revenues both directly and through borrowing. Assuranceswere obtained from GOI at negotiations that, until the project has been completed,development grants and developmentbudget allocations(DIPNAS) of the MPW for urban infrastructure that is the responsibilityof DKI-Jakartashall not exceed their FY88/89 levels in nominal terms.

D. DKI-JakartaFinancial Management and Accounting

5.12 In common wiLh all regional governmentsDKI-Jakarta follows financial managementand accountingpractices prescribed by MHA. Responsibilities are fragmentedrather than concentratedin a single finance department. Budgeting,authorization and control of expenditureare the responsibilityof the city finance office (Biro Keuangan);policy and programmingare the responsibilityof the Bappeda; revenues are administeredby the Dinas Pendepatan;and cash management is the responsibilityof a separate cashiers office. Auditing is carried out by an Inspectorate(Inwilda). In addition, each departmenthas a finance sectionwhich handles budgetingand payments, and maintains financialrecords, and project units have similar arrangements. The MHA regulationsgoverning financialmatters are deficient in several respects;for example, in the lack of discretionarypractice permittedon matters such as expenditureauthority and budgetingfor routine expenditures. Budgetingprocedures and formatsare not useful for policy or management decisionmakingand difficult to coordinateamong different levels of gove--afent.Not suprisinglyDKI-Jakarta's annual statementsare difficult to reconcile as a result of the budgetingand accountingformats in use. - 39 -

5.13 Several initiativesare now underway to improvefinancial management and accountingin regional governments. Planningand budgetingapproaches are being addressed through the introductionof multi-year programmingunder the IUIDP approach (para. 1.4) and will be introducedto DKI-Jakartaunder the project (para. 2.7) includingassistance in financialmanagement policy developmentto Bappeda which would inter alia, identify the issues in DKI's financialmanagement. Under Loan 2408-IND (Fifth Urban Development)a study of local governmentfinancial management and accountingis proceedingin four pilot cities. Reform of the Dinas Pendapatanand the revenuemanual is proceeding in nearly 100 cities under Loan 2816-IND. It is expected that a large scale program of local governmentfinancial management and accounting reform includingDKI-Jakarts will follow from this effort within the next two- three years.

5.14 A further importantinitiative from the budgetingstandpoint is the classificationof infrastructureand related functionalresponsibility (includingfinance), between central and local goverrments,now proceedingin 10 major cities includingDKI-Jakarta under Loan 2816-IND. Relative responsibilitiesfor urban roads functionshave already been agreed for four major cities under Loan 2817-IND. The portion of the project funded by DKI- Jakarta comprising improvementand new constructionof local roads and associatedtechnical assistance, is consistentwith the allocationof responsibilitiesunder GOI's road law of 1980. Agreementbetween DGBM and DKI-Jakartaon appropriateclassification of of the DKI road system has yet to be ratified however (see Annex 9, Table 3). Consequently,responsibility for the improvementof certain arterial road links (constituting14% of project costs) has been assumed for historicalreasons by DGBM. DGBM involv.mentin such improvementsis useful at this time in strengtheningof in-house experiencein urban roads developmentbut unjustifiedcentral government funding of such improvementsshould be phased out in the near future. DGBM and DKI-Jakartahave thereforeagreed on a classificationsatisfactory to the Bank, of the componentsof the DKI-Jakartaroad network as provided for in the Borrower's Road Law of 1980. - 40 -

VI. PROJECT JUSTIFICATIONAND RISKS

A. Project Justification

6.1 The proposed project would primarilyimprove the transportand traffic conditionsin DKI-Jakartathrough significantupgrading of existing road infrastructure,the constructionof new roads and missing links, and city-widetraffic managementmeasures, as well as bus operations improvements. The investmentsproposed are aimed at reducing traffic congestionand travel times, and improvingtraffic enforcementand road safety.

6.2 The project will also have significantinstitution building benefits at both the city and national levels. The project will contributeto the improvementof the professionaland technicalcapabilities of DGLT and DKI- Jakarta agency staff in transport planning,traffic managementand road maintenanceas well as enhancingCentral Government'sability to prepare and supervisecomprehensive urban transportinvestment programs.

6.3 Importantlonger-term benefits are also expected from the implementationof GOI's urban sector developmentpolicies and in particular from the introductionof integratedplanning and programmingof urban infrastructureexpenditures and local revenue improvementin Jabotabek.

B. Economic Evaluation

6.4 Because of the large backlog of transportworks needed in DKI- Jakarta, and local and central governmentfunding constraints,the list of candidateimprovement schemes in the city far outstripsavailable financial resources. In order to establish prioritiesthe economic benefits of all major proposed improvementswere quantifiedand used as a basis for selecting componentsfor this project. Vehicle operatingcost (VOC) savings and travel time savings for work related trips were used as the basis for determining most economic rates of return. The average internalrate of return (IRR) of the project componentsfor which benefits can be quantified,and which represent54% of the total project investmentcosts (net of advisory services),is estimatedat over 40% includingtime savingsand VOC (see Table 6.1). The IRR for individualcomponents varies from 27X to over 100% for road constructionschemes, and ranges between 37% and 72% for major intersectionimprovements. The average IRR for road constructionand intersectionimprovements, even with increasingcosts 20% and decreasing benefits 15%, is estimatedat about 30%. The developmentroad components, representingabout 13% of the total project cost, are not justifiedsolely on VOC and travel time savings grounds, as projectedtraffic volumes over the next severalyears will be low until adjacent land is developed. However, by using low-cost initialconstruction standards, these roads can also be justifiedby the increasedland values they generate. The estimated IRR for these road links varies from 40% to 75%. Due to the difficultiesof measuring the benefits of many smaller and disbursedimprovements, the benefits of the trafficmanagement and road maintenance/rehabilitationcomponents, which representanother 15% of total project costs, were not quantified. However, these schemes, by virtue of their relativelylow cost and concentrationon - 41 - road links with either high travel volumes and/or advanced stages of disrepair,are expected to have rates of return at least comparableto the higher cost road and major intersectionimprovements. The relatively high rates of return for project componentsreflect their fill-in nature in an environmentof already congestedconditions and rapidly growing traffic volumes. (See Annex 11 for details of the economic analysis.)

Table 6.1: SUMMARY OF ESTIMATEDECONOMIC RETURNS

Internal Rate of Return (Z) Economic Costs Costs+20Z cost +20% benefits (Rp billion) 10-year IRR -15% Component Average Range Average Range Average Average

Primary arterial 43 42-44 73 45-102 63 54 (National)roads

Secondary artrl. 27 5-38 44 31-62 33 27 (Local) roads

Major intersections 8 7-10 62 37-73 52 46

Developmentroads 4 1-12 52 40-75 47 40

C. Urban Poverty Impact

6.5 The precise impact of the project on the poverty group is difficult to estimate because the project benefits would accrue to the populationas a whole and the economic developmentof DKI-Jakarta. The approximateproportion of the populationof DKI-Jakartafalling below the relative poverty line (US$258/capitain 1985) is about 20%. Almost all the principalroad componentsof the project (which account for about 60Z of project benefits) are located on heavily travelledpublic transportcorridors, where it is estimated that the average daily flow of low-incometravelers represents about 10Z of person trips. Thus at least a minimum of 6% of the project benefits would accrue directly to the lower income groups.

D. EnvironmentalImpact

6.6 The project is expected to have a significantnet positive environmentalbenefit through its potential influenceon beneficial land use and air quality over the longer term. Short term negative impactswill occur during constructionbut would be minimizedby appropriateconstruction techniques. Resettlementof about 1,000 familieswould be needed during the five year land acquisitionperiod. The various impactsare sunmmarizedbelow and further details are given in Annex 10. - 42 -

6.7 A major long term impact of the project is expected to lie in the reorientationof the Jabotabekdevelopment pattern towards an east-west axis and away from the environmentally-threateningnorth-south pattern of the past. A Bank-fundedstudy of Jabotabekdevelopment needs and priorities showed that new development(led by the existing road network) was unavoidably locatingin the poorly serviced and flood-pronewetlands of the northern coastal area and the aquifer recharge area of the agriculturaluplands to the south (para 1.7). Seventy percent of Jakarta's residentscurrently rely on groundwateras their main source of water. Developmentof the southern areas could increase run-off and pollute the remaininginfiltration. Recommenda- tions for reorientationand control of north-southdevelopment have been incorporatedin the Jakarta Master Plan (RUTR Daerah 2005) and extensive developmentof the eastern and western fringes of DKI is underway (residential developmentin these areas is being assisted in part by Loan 2725-IND - Housing Sector Loan). The projectwould provide local access to the eastern and western areas of the city as well as arterial connectionsto the main road network and increase capacity for east-westmovements. It would also provide technica.assistance to help better define environmentallysensitive areas and develop appropriatedevelopment controls and policies (para. 2.9).

6.8 The road constructionand road maintenanceand rehabilitationcomponents will include drainage facilities;widening, strenthening, and improving of road surfaces and geometry;and provisionof pedestriansidewalks; all of which are expected to improve drainage and reduce periodic flooding,and reduce traffic noise and accidents. These same improvementsshould collectively contributeto improving traffic flows which will have a positive,though limited,effect on air quality through reduced vehicle emissions. In order to monitor air quality better and help MOC develop appropriatevehicle emission standardsand controls,the project would support strengtheningof Jakarta's air quality monitoring system and develop air pollutioncontrol policies and standards(para 2.19).

6.9 While significantlonger-term benefits are expected,certain road constructioncomponents involving land acquisitionwill have at least a temporaryadverse impact due to disruptionscaused by taking parts of some propertiesand, in some cases, the partial or total demolitionof residential and commercial structures. It is estimatedthat about 10,000 parcels of land totallingabout 250 hectares will be acquired, on which about 10,000 residential structuresand business structureswill be partiallyor totally demo- lished. Most occupantsare expected to continue dwelling or working on the remainingplot but approximately1000 families may need to relocate (See Annex 10 for details). MWA and DKI-Jakartaare responsiblefor land acquisitionand have well establishedprocedures successfullyapplied in past Bank-funded urban projects for compensatingland owners for propertiesand businesses taken or relocatedand have made adequate provisionin the project budget. A plan satisfactoryto the Bank was agreed at negotiationsfor the project land acquisitionand resettlement(para 4.19). As part of the agreed plan DKI- Jakarta will monitor the socio-economicimpact on the families affected and, during the first year of the project, formulaterecommendations for improvements in its proceduresand their implementationthat would be incorporatedas necessary in the later years of the project. - 43 -

E. Risks

6.10 The principalproject risk relates to the achievementof the institutional developmentobjectives of the project, particularlythe establishment of integratedplanning and programmingmechanisms, and the strengtheningof traffic and public transportmanagement. The policy decisionsand coordination needs of an integratedprogram will be considerable. GOI has, however, establisheda high-levelcoordinating team (TKPP) includingall involved agencies of MHA, MPW and MOF, with working level groups focussed on specific aspects falling into the broad categoriesof planning, implementation,finance and institutionaldevelopment, and specific task forces to deal with special sectoral issues such as water resourcesmanagement, and urban transport development. Assuranceswere ^btained at negotiationsthat Tim Koordinasi would oversee (a) the Jabotabek programdevelopment, and (b) the Jabotabek Urban Transport Plan preparation(paras. 2.7 and 2.11).

6.11 The number of qualifiedengineers and techniciansemployed by the city in the field of urban transportis well below what could be regarded as the normal requirement. For this reason the project preparationincluded a study of the manpower developmentneeds and a review of the city's transport related institutions. The proposed technicalassistance and training programs have been based on these findings and designed to meet the needs of DKI- Jakarta. In the short run the assignmentof advisors to key agencies will ensure satisfactoryimplementation of the project. Although the principal benefits of the training programwill only begin to come on stream after one or two years, on the job training and workshops designed to improve both managementand technical skills should provide some immediatebenefits. Another concern is that the potentialbenefits that should accrue due to improvementsin traffic managementmay not be fully realized because of poor enforcementof traffic regulations. This aspect of traffic managementhas been fully investigatedduring project preparationwith the full cooperation of the traffic police. Training and equipmentare included in the project to improve police efficiency in the field of traffic control and safety.

6.12 The main concern is the possibilitythat the public transportob- jectivesof the action plan may not be fully achieved. The PPD public bus company restructuringis at risk due to the inherent difficultiesin major restructuringof large state enterprises. The Jabotabekurban transport review (para 2.12) may not be timely enough to preventmajor commitmentsthat could represent serious distortionsin urban infrastructureexpenditure in Jabotabek for many years to come. In order to lessen the risk in the PPD case a detailed,monitorable action plan has been devised (para 2.14) and agreed with the government and PPD management including the assignmentof senior managementto be responsiblefor restructuringand the appointmentof consultants to assist in the design and implementationof efficiencymeasures. In the case of Jabotabek Railway assuranceshave been obtainedunder the recently approved Railways TechnicalAssistance Loan that a review of the Jabotabek Railway project will be undertaken by GOI and the findings discussedwith the Bank. In addition that Loan also provides for annual reviews of the PJKA planned expendituresby the Bank. - 44 -

VII. AGREEMENTSREACHED AND RECOMMENDATION

7.1 During negotiationsassurances were obtained from GOI that:

(a) GOI shall prepare or cause DGLT, DGBM, DKI-Jakartaand other relevant agencies to prepare and adopt by March 31, 1989 an integrated five-year expenditureprogram and the related first annual program for the Jabotabekregion, satisfactoryto the Bank. Thereafter COI shall in consultationwith the Bank, prepare the subsequentannual programs (para. 2.7);

(b) GOI would undertakea review of projected transportdemand and identify a transportcorridor network together with policies and plans for an integratedtransport system in the Jabotabek region includingmass transit options, which review will be furnished to the Bank by March 31, 1990. Consultantsfor this purpose shall be n ;piointed by March 31, 1989. Thereafterdetailed action plans for Lus, rail and other modes will be furnishedto the Bank by March 31, 1991 (para. 2.12);

(c) GOI shall implementor cause to be implementeda PPD/DAMRITransport Action Plan for the Jabotabek region in accordancewith a time schedule satisfactoryto the Bank (para 2.14);

(d) GOI shall have appointedor caused to be appointedthe consultants to assist (i) in transportnetwork planning by September 30, 1988 (para. 2.12); (ii) in air quality monitoringby January 1, 1989 (para 2.19); and (iii) the Project CoordinationOffice by June 30, 1988 (para. 4.5).

(e) GOI shall cause DKI-Jakartato be responsiblefor overall project coordination,accounting and monitoringand shall cause to be establisheda ProjectMonitoring Office under DKI's Bappeda (para. 4.5);

(f) GOI shall cause all land acquisitionand tesettlementrelated actions to be carried out in accordancewith a plan and implementationschedule satisfactoryto the Bank (para. 4.19);

(8) (i) the consolidatedproject account, includingdocumentation on SOEs, will be audited annually in a timely fashion by independent auditors satisfactoryto the Bank; and (ii) DKI-Jakartasubmit annually to the Bank certifiedcopies of the audited project account no later than nine months after the end of each fiscal year commencing in FY88/89 (para. 4.20);

(h) GOI shall cause DKI-Jakartato prepare by Marck 31, 1989 and thereafter implementa revenue improvementplan that shall increase DKI-Jakarta'slocal tax revenues by at least 6Z per year in real terms from April 1, 1989 until the project has been completed (para. 5.7); - 45 -

(i) GOI shall cause DKI-Jakartaand DC Pajak to carry out jointly an action plan such that PBB revenues from the DKI-JakartaPBB tax area increase by at least 13X per year in real terms from April 1, 1989 until the project is completed (para. 5.10);and

(j) GOI shall ensure that, until the project is completed,development grants and developmentbudget allocations(DIPNAS) of the Ministry of Public Works' for urban infrastructurethat is the responsibility of DKI-Jakartashall not exceed their fiscal year 1988/89 levels in nominal terms (para 5.11).

Conditionsof Effectiveness

7.2 The followingare conditionsof loan effectiveness:

(a) adoption by TKPP of an Urban TransportDevelopment Action Plan satisfactoryto the Bank (para. 2.11); and

(b) execution of a subsidiaryloan agreementbetween GOI and DKI-Jakarta satisfactoryto the Bank (para. 3.5).

Recommendation

7.3 Subject to the above agreementsand conditions,the proposed project is suitable for a Bank loan of US$150 million to the Republic of Indonesia for 20 years includingfive years' grace at the standard variable interest rate. - 46 - ANNEX1 Page 1

INDONESIA

JABOTABEKURBAN DEVELOPMENT PROJECT

Urban InfrastructureExpenditure Programring

National Overview

1. The total expenditureon certain aspects of urban infrastructure (raw and treatedwater supply, flood protectionand drainage, sewerage and sanitation,solid waste management,Kampung improvement,and roads, but excludingpublic transport)by central and local governmentduring Repelita IV (1984-89)is expected to be about Rp 2.8 trillion. Detai ; are summarized in Table 1 in nominal terms and in Table 2 in real terms. These summaries, compiled from Bank staff estimates,indicate that expenditureon urban roads is expected to amount to about to about Rp 90 billion per year or 16Z of total during this period. In comparisonwith other middle income developing countriesthis proportion is quite low; a fact emphasizedby the generally poor traffic conditionsin Indonesiancities. However, the tables do not includeexpenditures on urban bus and railway services. Expenditureson these aspects of urban transportare estimatedto be about Rp 280 billion per year since 1985 (about Rp 94 billion on bus investmentand operationsand some Rp 186 billion on railway investments,rehabilitation and operations-mainly in Jakarta). Therefore, total urban transportexpenditures would amount to Rp 2.04 trillion,nearly 49% of overall urban infrastructureexpenditures includingurban transport, i.e., Rp 4.2 trillion. The balance of expenditures between roads, buses and railways is heavily weighted in favor of railway expendituresconfined mainly to Jabotabek (this imbalanceis discussed fully in Annex 2). Consequently,the need for additionalexpenditures in roads and buses during Repelita V is great, particularlyin larger cities.

2. Funding of the urban transport program is sunmmArizedin Table 3 and details o' the urban roads funding is shown in Table 4. Central and local governmentresources will have contributedabout equally to the urban roads program, but 80% of the costs of bus and rail servicesare being met from Central Governmentresources since intern1 cash generationin the various state enterprisesinvolved is quite weak., Under the current budgetary constraint,Central Governmentfunding for both railways and other modes is scarce and heavy reliance is being placed on foreignborrowings, mainly from OECF and the Bank.

Jabotabek Expenditures

3. A breakdownof urban infrastructureexpenditures in the Jabotabek area during Repelita IV is not readily available. However, spending on urban infrastructure(not includingpublic transport)in DKI-Jakartaduring this

1/ The State Railway (PJKA) is currentlya departmentof the Ministry of Comuicationsbut will be converted into a state enterprise shortly. - 47 - ANNEX 1 Page 2

period is estimated to be about Rp 520 billion or 182 of total. If public transportexpenditures are included then DKI-Jakartawould account for Rp 1.7 billion or some 40X of total. This is more than twice the national averageof $71 per capita expenditure(including public transport).

Jabotabek ExpenditurePlanning and Prograo ing

4. GOI will expand the current Jabotabek planning and programming coordinationarrangements to undertakethe preparationof a five-yearexpenditure program and annual programs for the JabotabekLevel I and II local governmentareas during FY89/90-93/94in line with Tim KoordinasiIUIDP guidelines and the RUTR 2005 master plan for DKI and structureplan for Jabotabek. The followingprocess would apply:

(a) ocal governmentswill continue to prepare detailed area plans, (with assistanceas required from TKTD), local expenditureprograms, financingand revenue plans in consultationwith respective BAPPEDAs;

(b) Jabotabek Planning Team/Tim Teknis, assisted by BKSP, will inventory,asseos and coordinate sectoralmaster plans, in consultationwith respectiveBAPPEDAs;

(c) Sector agencies (centraland local); will continue to prepare sectoral plans and feasibilitystudies in accordancewith approved master plans where availableand under the direction of BAPPEDA Tk I;

(d) BAPPEDAS Tk I will prepare (through RAKORNAS)and endorse the 5-year and annual IUIDP expenditureprograms and financing plans for the proposedNatioral, Provincialand local developmentprojects and O&M in their respectiveparts of Jabotabek; coordinationbetween Provinces (and with their respectiveLevel II local governmentsand with central governmentagencies) and preparationwill be facilitatedby BKSP; the programs will focus on the water resources (raw water, water supply, sanitation,drainage, water pollution control),urban transport(roads and traffic, buses and railways), and housing (KIP, public housing, Guided Land Development) subsectors;

(e) Tim Koordinasiwill provide urban developmentpolicy and IUIDP programmingguidance to BAPPEDAs and approve the Jabotabek sector plans, and 5-year and annual programs.

5. Technicalassistance included in the project would be provided by DG Bangda to BAPPEDA Tk I JABAR and DKI to help prepare the 5-year expenditure program and initial annual program, financingplans and revenue improvement plans. The work would also includethe formulationand implementationof appropriateenvironmental protection regulations and enforcementmeasures for the environmentally-sensitiveareas in DKI and JABAR lying to the south of Jakarta. Outline terms of referenceare given in Annex and full TOR would be prepared for negotiationsby DG Bangda in collaborationwith DC Cipta Karya assisted by the UNCHS/UNDP IUIDP Support Project Team and under the guidance of Tim Koordinasi. INDOUISIA

JAJOTABA URtBN DEVELOPIUN?PROJECT

National Urban Sector Expendlturesr 1983/84-1988/89

S6-ry Application and Sources of Fund., by Agency

1983/84 1984/85 1985/86 1986/87 1987/88 1988/89 1983/84 1984/85 1985/86 1986/67 1987/88 1988/89 ~~~~~(Rp billllon)_(S

Apliceatton of Funds .Develop_nt Zxpenditureu 247.3 336.4 352.6 315.9 613.2 597.2 76.1 78.4 75.4 73.7 81.7 78.0 liter *'Uppiy 106.5 -131. 7 12 1.1 6.24".4 24.8 M WX My YT Hbaanwaste 7.1 9.8 13.0 18.2 30.0 20.5 2.2 2.3 2.8 4.3 4.0 2.7 Drainage and flood 35.7 36.3 51.7 45.9 131.9 143.5 11.0 8.5 11.1 10.7 17.6 13.7 Solid waste 15.7 12.3 7.9 6.6 18.1 17.2 4.8 2.9 1.7 1.5 2.4 2.3 KIP 40.6 28.5 40.7 23.4 37.5 49.1 12.5 6.6 8.7 5.5 5.0 6.4 Roadr 54.6 129.9 75.6 70.6 84.3 100.5 16.8 30.3 16.2 16.5 11.2 13.1 Planning, training & overhead 14.3 13.1 32.0 30.2 46.2 40.0 4.4 3.1 6.8 7.0 6.2 5.2

_peratlon and NaIntenance 77.7 92.7 114.8 112.5 137.3 168.2 23.9 21.6 24.6 26.3 18.3 22.0

Total 325.0 429.1 467.4 428.5 750.6 765.4 100.0 100.0 100.0 100.0 100.0 100.0 e Sources of Funds DIP 126.3 215.9 166.1 83.2 178.6 201.1 38.9 50.3 35.5 19.4 23.8 26.3 Cipta Karya 7. 76.5 38.0 T57.3105.3 102.5 26 10 14. Ti6rIM Pengairan 37.3 39.7 38.1 21.3 43.9 40.7 11.5 9.2 8.1 5.0 5.8 5.3 Bin Marga 15.5 99.7 30.1 8.3 20.5 48.2 4.8 23.2 6.4 1.9 2.7 6.3 Other 0.0 0.0 0.0 0.0 9.0 9.6 0.0 0.0 0.0 0.0 1.2 1.3

ForeignAid 22.3 42.6 73.9 103.7 266.1 243.6 6.8 9.9 15.8 24.2 35.5 31.8 Cipta Karya 20.2 40.0 61.9 80.2 178.6 132.6 6.2 9 !.3 1 178. 23. 17.3 Pengairan 2.1 0.0 4.3 10.9 72.3 81.3 0.6 0.0 0.9 2.6 9.6 10.6 Dina Marga 0.0 2.6 7.6 12.6 13.8 28.4 0.0 0.6 1.6 2.9 1.8 3.7 Other 0.0 0.0 0.0 0.0 1.5 1.3 0.0 0.0 0.0 0.0 0.0 0.0 Subtotal DIP + Foreign 148.6 258.5 240.0 186.9 444.8 444.7 45.7 60.2 51.3 43.6 59.3 58.1

Domestic Loans 3.5 7.7 11.0 12.1 39.4 44.7 1.1 1.8 2.4 2.8 5.2 5.8

IAPBDI & II (IDn1. INPRES) 172.9 162.9 216.5 229.5 266.3 276.0 53.2 38.0 46.3 53.6 35.5 36.1 Level I SO 5.8 6.5 7 22 15.3 1.5 1. .4 2.0T 2.T Level II 109.0 80.6 118.9 122.3 146.2 145.5 33.5 18.8 25.4 28.5 19.5 19.0 PDAM 58.9 76.5 91.1 98.5 98.9 115.2 18.1 17.8 19.5 23.0 13.2 15.1

Subtotal local expenditures 176.4 170.6 227.5 241.6 305.7 320.7 54.3 39.8 48.7 56.4 40.7 41.9 Total 325.0 429.1 467.4 428.5 750.4 765.3 100.0 100.0 100.0 100.0 100.0 100.0

Soarce: Date from Staff Apprai"l Report No. 6598-IND (Urban Sector Loan). INDONESIA

JABOTAJEK URBAN DEVELOPMENTPROJECT

Notional Urban Sector Expenditures.1983/84-1988/89

Summary Applicatio;iand Sources of Funds (Real 1983/84 Rupiahs)

1983/84 1984/85 1985/86 1986/87 1987/88 1988/89 1983/84 1984/85 1985/86 1986/87 1987/88 1988/89 (Rp billion) - (Z)

Application of Funds DevelopmentExpenditures 247.3 305.1 299.3 238.9 426.4 396.9 76.1 78.4 75.4 73.7 81.7 78.0 Water supply 79.3 96.6 111.8 91.6 184.5.4 150.5 12T4 1.T -28-.2 1. =5 Human waste 7.1 8.9 11.0 13.8 20.9 13.6 2.2 2.3 2.8 4.3 4.0 2.7 Drainage and flood 35.7 32.9 43.9 34.7 91.7 95.4 11.0 8.5 11.1 10.7 17.6 18.7 Solid waste 15.7 11.2 6.7 5.0 12.6 11.5 4.8 2.9 1.7 1.5 2.4 2.3 RIP 40.6 25.8 34.5 17.7 26.1 32.6 12.5 6.6 8.7 5.5 5.0 6.4 Roads 54.6 117.8 64.2 53.4 58.6 66.8 16.8 30.3 16.2 16.5 11.2 13.1 Planning, training & overhead 14.3 11.9 27.2 22.8 32.1 26.6 4.4 3.1 6.8 7.0 6.2 5.2

Operation and Maintenance 77.7 84.0 97.5 85.1 95.5 111.8 23.9 21.6 24.6 26.3 18.3 22.0

Subtotal 325.0 389.2 396.8 324.0 521.9 508.7 100.0 100.0 100.0 100.0 100.0 100.0

Sources of Funds DIP 126.3 195.8 141.0 62.9 124.2 133.6 38.9 50.3 35.5 19.4 23.8 26.3 Cipta larya 73.5 69.4 83.2 40.5 73.2 68.1 22.6 1T7.8 21T 12.5 14.0 13. Pengairan 37.3 36.0 32.3 16.1 30.5 27.1 11.5 9.2 8.1 5.0 5.8 5.3 Bina Marga 15.5 90.4 25.6 6.3 14.3 32.0 4.8 23.2 6.4 1.9 2.7 6.3 Other 0.0 0.0 0.0 0.0 6.2 6.4 0.0 0.0 0.0 0.0 1.2 1.3

Foreign Aid 22.3 38.7 62.7 78.4 185.1 161.9 6.8 9.9 15.8 24.2 35.5 31.8 Cipta Karya 20.2 36.3 52.66 0.60.6 1T24.2 1-2 T.2 T3T 13.3 18.7 25. 17.3 Pengairan 2.1 0.0 3.7 8.3 50.3 54.0 0.6 0.0 0.9 2.6 9.6 10.6 Bins Marga 0.0 2.4 6.5 9.5 9.6 18.9 0.0 0.6 1.6 2.9 1.8 3.7 Other 0.0 0.0 0.0 0.0 1.0 0.8 0.0 0.0 0.0 0.0 0.2 0.2

Subtotal DIP + Foreign 148.6 234.5 203.7 141.3 309.3 295.6 45.7 60.2 51.3 43.6 59.3 58.1

Domestic Loans 3.5 7.0 9.3 9.2 27.4 29.7 1.1 1.8 2.4 2.8 5.2 S.G

APBD I & II (Inl. INPRES) 172.9 147.7 183.7 173.5 185.2 183.4 53.2 38.0 46.3 53.6 35.5 36.1 Level I 5.0 5.3 5.5 6.6 14.7 10.2 1.5 T1. 1.4 -.T -iT: 2T. Level II 109.0 73.1 100.9 92.5 101.7 96.7 33.5 18.8 25.4 28.5 19.5 19.0 PDAN 58.9 76.5 91.1 98.5 68.8 76.6 18.1 17.8 19.5 23.0 13.2 15.1

Subtotal local expenditures 176.4 154.7 193.1 182.7 212.6 213.1 54.3 39.8 46.7 56.4 40.7 41.9

Total 325.0 389.2 396.8 324.0 521.8 508.7 100.0 100.0 100.0 100.0 100.0 100.0

Soure:t Deta froe Staff Appraisl lamport No. 6594- DD (Urban Sector Loan). -50-ANNA i Table 3

INDONESIA

JABOTABEK URBANDEVELOPMENT PROJECT

Summary of Urban Transport Expenditures During Repelita IV (1984/85- 1988789)

Rp billion X

Apglicationof Funds investment Urban roads /a 460.9 22.6 Public transport Buses /b 94.0 4.6 RailwaFy(Jabotabek)/c 864.0 42.4 Operationsand Maintenance urban roads /a 176.3 8.6 Public transport Buses /d 378.0 18.6 Railwady(Jabotabek)/e 65.0 3.2 Total 2,038.2 100.0 Sources of Funds CentralGovernment Ministry of Public Works /a 206.8 10.1 Ministry of CommunicationsI/f 488.1 23.9 Foreign aid Ministry of Public Works /a 65.0 3.2 Ministry of Communications 592.4 29.1 State Enterprises Buses /d PPD 180.0 8.8 DAMRI 124.0 6.2 Railways - PJKA /e 16.5 0.8 Local Governmant/a APBD I & II (includingINPRES) 365.4 17.9 Domestic borrowing 0.0 0.0

/a Urban Sector Loan (2816-IND)estimates; not includingtoll roads. T7 Estimatedfleet replacementand expansioncosts (PPD Rp 70 billion and DAMRI Rp 24 billion). /c Stage I and first-yearStage II JabotabekRailway costs. T7 Based on PPD 1985 operating results. PPD revenuesestimated at Rp 36 billion/yearand costs at Rp 56 billion/yearand DAMRI revenues estimated at Rp 25 billion/yearand costs at Rp 20 billion/year. /e EstimatedJabotabek Railway operatingcosts (approximatelyRp 15 billion/year). Operatingrevenues based on 1986 results (Rp 4.1 billion/year). /f Includingestimated capital and overatingsubsidies to PPD and PJKA. INDONESIA

JABOTABEKURBAN DEVELOPMENT PROJECT

Application and Sources of Funds - Urban Roads Subsector. 1983/84-1988/89

1983/84 1984/85 1985/86 1986/87 1987/88 1988/89 1983/84 1984/85 1985/86 1986/87 1987/88 1988189 (Rp billion) (X)

Application of Funds Development Expenditures 54.6 129.9 75.6 70.6 84.3 100.5 70.5 84.2 69.2 70.7 70.1 65.4 DKI 20.1 94.9 32.4 32.3 30.7 2 61 5 . 280 .5 31. Large cities 18.1 16.1 19.1 22.4 26.0 54.6 23.4 10.4 17.5 22.4 21.6 35.5 Other 16.4 18.9 22.1 16.0 26.0 15.2 21.2 12.2 20.2 16.0 21.6 9.9

Operation and Maintenance 22.9 24.4 33.6 29.2 36.0 53.1 29.5 15.8 30.8 29.3 29.9 34.6

Total 77.5 154.3 109.2 99.8 120.3 153.6 100.0 100.0 100.0 100.0 100.0 iOO.O

Sources of Funds DIP 15.5 99.7 30.1 8.3 20.5 48.2 20.0 64.6 27.6 8.3 17.0 31.4 Bina Marga 15.5 WT 30.1 t7 T5 : - WU*4I2 TU T7 n T Other 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Foreign Aid 0.0 2.6 7.6 12.6 13.8 28.4 C.0 1.7 7.0 12.6 11.4 18.5 Bina Marga 0.0 2.6 13.8 0 28.4 . 0 1.7 7.0 12.6 11.4 18.5 Other 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Subtotal DIP + Foreign 15.5 102.3 37.7 20.9 34.3 76.6 20.0 66.3 34.5 20.9 28.5 49.9

Domestic Loans 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

APBD I & II (incl. INPRES) 62.0 52.0 71.5 78.9 86.0 77.0 80.0 33.7 65.5 79.1 71.5 50.1 Level I 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 T6 0.0 0W. Level II 62.0 52.0 71.5 78.9 86.0 77.0 80.0 33.7 65.5 79.1 71.5 50.1 PDAM 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Subtotal local expenditures 62.0 52.0 71.5 78.9 86.0 77.0 80.0 33.7 65.5 79.1 71.5 50.1

Total 77.5 154.3 109.2 99.8 120.3 153.6 100.0 100.0 100.0 100.0 100.0 100.0

Notes: (1) Does not include urban toll roads or public transport expenditures. (2) Local Government contributions all attributed to Level II. (3) O&Minclude betterment program in project years.

Source: Data fromt Staff Appraisal Report No. 6598-IND (Urban Sector Loan). ANNEX2 Page 1

INDONESIA

JABOTABEKURBAN DEVELOPMENT PROJECT

Traffic and Transport in Jabotabek

A. Population,Traffic and Road Network Data

1. Jakarta is the capital and largest city in Indonesia. It is located on the north coast of Java and had an estimatedpopulation of 7.75 million in 1985. It is between three and four times the size of each of the four largest provincialcities in Indonesia,namely Surabaya,Bandung, Medan and Semarang, three of which are also located in the main island of Java. A comparisonof the populationfigures and growth rate of Jakarta with the other principal Indonesiancities is given in Table 1.

Table 1: CITY POPULATIONAND GROWTH RATES

1971/a 1980/a Growth rate 1985/b Growth rate city population population 1971-80 population 1980-85 (million) (million) (X) (million) (X)

Jakarta 4.58 6.50 3.97 7.75 3.58

Surabaya 1.56 2.03 2.97 2.25 2.01 Bandung 1.20 1.46 2.20 1.64 2.35 Medan 0.64 1.38 8.91 1.64 3.51 Semarang 0.65 1.03 5.25 1.32 4.93 Regional cities combined 4.05 5.90 4.27 6.85 3.03

/a Census data. 7i Estimate.

2. The number of vehicles and the growth in the vehicle fleet in Jakarta between 1981 and 1985 are shown in Table 2. Current vehicle fleets and comparativegrowth rates for the other major cities are also shown in this table. Apart from motorcycles,it will be seen that Jakartahas one and a half times the total number of vehicles in the four regional cities combined, there being a preponderanceof cars and buses in Jakarta. Buses include all sizes of bus, includingminibuses and paratransitvehicles. There are six times as many buses in Jakarta as in the other cities, though they serve a comparablepopulation. (The motorcyclesin Jakarta, however, representonly 80Z of the number in the other cities.) - 53- ANNEX2 Page 2

Table 2: VEHICLE FLEETS AND GROWTH RATES

Year Car Truck Bus Total Motorcycle

Jakarta 1981 246,153 97,369 38,321 381,753 492,792 1982 275,139 112,494 49,827 437,460 570,972 1983 299,164 126,859 62,515 488,538 628,414 1984 323,715 141,141 81,783 546,639 673,061 1985 351,673 159,207 102,638 613,518 741,040 Growth rate 9.3Z 13.1% 28.0% 12.6Z 10.7%

Surabaya 1985 67,931 57,364 2,376 127,671 290,650 Growth rate 10.7% 20.2% 5.3Z 11.0% 8.9% Bandung 1985/a 75,190 42,350 5,905 123,445 227,560 Growth rate 3.4% 9.4Z 17.2% 5.8% 9.6% Medan 1985/a 51,770 30,429 6,346 88,545 207,665 Growth rate 12.8% 9.4% 13.4% 11.7% 6.9%

Regional 1985 227,219 154,918 16,630 398,800 916,950 Cities combined Growth rate 7.8Z 12.4Z 12.4% 9.6% 8.3%

/a Estimatedfrom provincialfigures.

Table 3: VEHICLE OWNERSHIP IN 1985 (Vehiclesper 1,000 population)

C;;y C,a ow-~r~L---- ie-^. u^1 l -h4v, Motorevele ownership

Jakarta 45 78 94

Surabaya 30 57 129 Bandung 46 75 139 Medan 32 54 127 Semerang 24 45 145

City average 33 58 134

/a Cars, trucks and buses.

Table 3 shows vehicle ownershiprates for the principalcities; only Bandung compres with Jakarta in car ownership. The vehicle fleet in Jakarta expressed as a proportionof the national fleet is shown in Table 4. - 54 - AN 2 Page 3

Table 4: PROPORTIONOF THE NATIONALFLEET REGISTERED IN JAKARTA, 1985 (2)

City Car Truck Bus Motorcycle Overall

Jakarta 38.5 20.1 55.9 16.8 18.2

Regional cities combined 24.7 18.0 9.1 20.8 17.7

Jakarta and regional cities combined 63.2 38.1 65.0 37.6 35.9

3. The size and classificationof the road network in Jakarta is shown in Table 5. Under this classification,which is due for updating, the primary roads (72 of the total) are the responsibilityof Central Government.

Table 5: CITY ROAD NETWORKS AND CLASSIFICATION

Primary Secondary Local Total km X km X km Z km Z

Jakarta /a 237 7 227 7 2,890 86 3,354 100

Regional cities combined /b 273 8 593 17 2,587 75 3,453 100

Source: /a Consultants'analysis of DKI records, 1987 Th City surveys.

B. Traffic and TransportSituation

4. Traffic Congestion. The existingnetwork of principalarterial roads in Jakarta is generallygood with the use of large multi-laneroads, grade separationand service roads on the main routes. It is supportedby a less satisfactorysystem of secondaryroads, which are not always fully con- nected. The system is, however, insufficientto deal with the relativelyhigh vehicle growth rates; this has resulted in increasinglyserious levels of traffic congestionover many parts of the system for severalhours each day. This is particularlyevident over most of the central area and especially severe in the traditionalcentral business district (CBD), which has become …-:l:tw:,-… th - f ……Cr…--- the M-e-r-- .- …"-…n 55 AANS 2 Page 4

the south. The historicalgrowth patternof the city is reflected in a strong north-southorientation to the road system;there is an absence of east-west roads and movement in this direction is generallydifficult. The city administration,DKI-Jakarta, wishes, however, to develop the city in an east- west directionto avoid the consumptionof environmentallysensitive lands to the north and south.

5. Governmenthas concentratedon the developmentof radial toll roads, one to the airport, one to the south to Bogor/Cianiand one to the west to Tangerang. A fourth (the Cikampek toll road) is nearly completed eastwards to Bekasi. An inner ring motorway (46 km long) due to be completed in the early 1990s already penetrateswell into the central urban area. An outer ring motorwayof 54 km in length will be constructedat a later stage. The general scale and layout of the primary arterialsand urban motorwayswould be well suited eventuallyto the developmentof bus ways.

6. Traffic Managementis poorly understoodand has not been used to a significantextent as a means of improvingtraffic flow. The traffic control equipmentis becoming elderly and there is insufficientunderstanding of its correctuse, largelydue to a lack of training. Parking in the central areas is permittedto an undue degree. This not only serves to encourage the use of privatevehicles in travellingto the center as opposed to public transport; it creates excessivereductions of capacity on existing principal streets due to the pressureof parked vehicles. Major programs of traffic improvement measures are required to improve the flow of traffic in the CBD and on many of the radial roads. There is a major need for the strengtheningof the traffic engineeringcapability of the city's trafficand transportationagency, Dinas LLAJR, to prepareand implementtraffic improvementschemes, monitor traffic flows and assist in the coordinationof the efforts of the planning and regu- lating agencies involved in the urban transportsector.

7. Road Maintenance. This popularlytakes the form of asphalt over- lays, without comparableattention to drainage and the preservationof good road profiles. Even so, there is no evidence as yet of a serious inadequacy of maintenanceon the primary roads, which would reduce road lite or capacity. There is, however, a serious deficiencyin the attention (both in terms of expenditureand methods) directed towards the maintenanceof local roads.

8. Public transportationplays a major but inadequaterole in the movement of people in the metropolitanareas of Indonesia. In Jakarta, 55% of person trips are by various forms of public transport,of which 44% are by city- bus, and about 2% by rail. Public transportmodes include double-decker buses, single-deckerbuses, minibuses,taxis, three-wheeledmotorcycles and three-wheeledpedal cycles as well as the Jabotabek commuter railway. In general,the buses and minibuses operateon specifiedroutes along the main arterials. Taxis and three-wheeledvehicles provide personal door-to-door services. All forms of public transportare regulatedby the authorities,but their operationsare uncoordinated. Apart from the publicly operated PPD buses all public transportvehicles are privatelyowned. The rail service and PPD buses operate at a loss and are heavily subsidizedby central government, although privatelyoperated buses can operate profitably. The public bus -.. ^e-Ote h.e amna-ato vi&hta nf wAv. much as bus ways- bus - -6 - ANNEX 2 Page 5

lanes or other priority measures;being mixed with private transport it will inevitablysuffer increasingdelays and reductionsin the level of the service and of profitabilityin future years, unless suitablemeasures are taken to give adequate priority to buses. A full discussionof the public transport issues is contained in Annex 3.

C. An IntegratedUrban Transport ImprovementPlan for Jabotabek

PresentSituation

9. Recent projectionsshow the number of trips in the Jabotabek area growingfrom 12 million in 1985 to 24 million in 2005. Public transportwill be required to play a major role in meeting this demand. There is currently no integratedpublic transportdevelopment plan which would deal with these demands in an efficientway. The only plan that exists is the Jabotabek Rail- way Master Plan which would: (a) link urban centers in the Botabek area; and (b) link these centers to Jakarta. This rail system, togetherwith local bus services,would serve the relativelylimited public transportationneeds of Botabek residentsonly. Becauseof its location,and limited capacity, the railwaywould not service the public transportneeds of DKI Jakarta residents. Bus service, on the other hand, is constrainedby lack of planning and weak performanceof PPD, the main carrier. The problem of bus efficiencyis furthercompounded by the large growth in private vehicles which are causing increasingcongestion. There is thereforean urgent need to develop an urban transportimprovement plan for DKI Jakarta which: (a) responds to existing and potentialdemands of Jakarta residents;(b) can be integratedat minimum cost with the existing bus servicesand passengerrailway; and (c) encourages efficientuse of existing rights of way.

10. The most basic objectivesof such a plan should be: (a) that it is cost effective;(b) that it responds to the existing and potential demands; and (c) that it is affordable,economically justifiable and financiallyviable (operateswithout subsidy). Unfortunatelythe public transport system, either the Jabotabekrailway system or the PPD bus system,does not meet these criteria. The master plan for the railway calls for the investmentof almost Rp 3,400 billion (US$2.0billion) by 2002. Over the next five years the railway investmentwould consumeover 86% of planned expenditurein public transport to serve only 1.7% of motorized trips in the Jabotabek area. The railway will thereforenot be cost effective,and is unlikely to be so in the future. Although the railway system improvementswere justified on the basis of the relief they would bring to the road network, the level of demand and its dispersedpattern are such that a more cost effective system could be achieved by the use of buses.

11. Similarly,the PPD bus operationalso fails to meet the above criteria: it is not cost effective,in that it is unable to achieve more than a 60X turnoutof buses; it fails to meet existing travel demands, causing severe overloadingand the need for additionalprivate services,and it has been unable to exist in the past without governmentgrants. In summary, the presentplan consists of investingin, and subsidizingthe operationsof (a) a very expensiverail service for which there is little demand; and (b) an iuefJ… ent bus perati n k d.it .chver . hea,w AamnAa * tnnhl -tn tnvFr - 57 - ANNEX 2 Page 6 its costs. On the other hand, the private large bus operator in Jakarta, and the public operator in regional cities are able run profitable services and can expand their fleets from internallygenerated funds. An efficientand reliable bus service could serve both local, and mass transitneeds of Jabotabekcost effectively.

12. The first issues that need to be addressed in developinga cost effectivetransport plan for Jabotabekare: (a) how to correct the imbalance of expenditurebetween rail and bus; (b) how to develop local and mass transportplans for Jakarta which meet the current and potentialdemands; and (c) how to improve the efficiencyand viabilityof the bus operations. Several recent studies have attemptedto address some of these issues, but none of them have formulatedan integratedapproach to tackle all of them at the same time, and produce a balanced least-costsolution. Following,is a broad strategy and an action plan, as agreed with the Government,for the developmentof an integratedplan.

Formulatinga Strategy and TransportAction Plan for Jabotabek

13. Based on the conclusionsand recommendationsof the recent stadies there are some immediatedecisions that could be taken in defining a public transportstrategy which would lead to a mass transit solution. First, in order to achieve maximum operationalefficiency, the various transportmodes making up the system should be capable of operatingon segregatedrights of way. Second, in order to keep costs as low as possible,the systems should be at-grade except to avoid conflictswith other modes, and should make full use of existing rights of way. Third, recognizingthat public transportmodes are more efficient in terms of road space than private vehicles,and that ulti- mately there will be a need to restrain private cars, the rights of way proposed for the public transportcould make use of existing road space. Fourth, in order to introduce system efficienciesthe various modes used should be integratedto permit easy transfer from one mode to another. With these principles in mind an integratedurban transportconcept plan could be as follo a:

(a) a network of public transportcorridors which would form the basis of the proposed Jakarta mass transit system;

(b) a number of public transportinterchange points which would enable Botabek rail passengersand Jakarta mass transit passengers to change modes;

(c) various levels of systems,made up of totally segregatedfacilities along the main transportcorridors, and semi-segregatedsystems (bus lanes) along the main feeder routes;

(d) the staged introductionof higher capacity vehicles along the public transportcorridors startingwith buses (guidedor free), or trolly buses, and developingto trams or light rail, as demands and capacity requirementsincrease; and - 58 - ANNEX 2 Page 7

(e) the implementationof traffic managementand traffic resr-3int measures.

14. The initial steps in developingproposals for an integratedurban transportsystem are set out in the followingaction plan and sumarized in Attachment1:

(a) evaluatingthe rail master plan in the context of a cost effective, integratedmass transit development,and making appropriateimprove- ments to the plan;

(b) identifyingthe principalmass transit corridorswithin the DKI Jakarta boundaries;

(c) drawing up conceptualproposals and carrying out feasibilitystudies for a system of bus ways (ultimatelyto be used by guided buses, trolley buses, trams, or light rail transit vehicles)and bus priority measures to be integratedwith the principalrailway interchange points;

(d) carrying out (in the medium term) the detailed design and implementation of the integratedmass transit developmentproposals;

(e) expanding the network, and types of services and routes in line with urban growth, greater densifica'cionof developmentand higher incomes; and

(f) improvingtraffic conditions on the road network, particularlyfor buses through the use of traffic managementmeasures.

(g) improvingexisting bus service planning and regulation(through strengtheningof public transportauthorities) to achieve affordable and reliable ie&vices;

(h) implementingand action plan for the improvementof PPD operations, mansgementand finances,and increasingthe supply of public transport through greater private sector involvement;

15. The first JabotabekUrban DevelopmentProject would attempt to implementthis program through specific technicalassistance, training and studies aimed at assisting: (a) LLAK and Dinas LLAJR with network planning and intermodalcoordination, public transportplanning and regulation,and trafficmanagement, with particularemphasis on bus priority measures (see Section D below and Annex 3); (b) PPD with managementand operations(Annex 3) and (c) the National traffic Police, SATLANTAS,with traffic operationsand enforcement(Annex 3). Special studies would be undertakento review the Jabotabekrail proposals,prepare feasibilitystudies for a mass transit system and carryout a parking study to develop a traffic restraintpolicy. Training programswould also be undertakenfor staff of the DGLT, LLAJR and SATLANTAS. The project would also make provision for the eventual detailed design of the mass transit proposals,the constructionor, imporcaunroau - 59 - ANEX 2 Page 8 links, trafficmanagement schemes and bus priority measures. Terms of reference for the technicalassistance required for the foregoirgare outlined in Annex 5.

D. Road Planning and Traffic ManagementAction Plan

Present Situation

16. Currently the planning of roads in Jakarta is not done on a systematicand comprehensivebasis. Coordinationwith public transport planning and general transportplanning within the city is weak and there is little coordinationwith the planning of roads in the Botabek area. There has not been until recently a single organizationwithin DKI Jakarta with an overall and continuingresponsibility for road planning with its own technical support staff able to develop a consistentand robust planning function in this field.

17. The Physical Facilities(Communications) section within Bappeda has an overall view of road planning and trafficmanagement but its staff are few in number,mostly concernedwith policy matters and program coordination. It does not have its own technicaldepartment that can undertake the preparation of schemesand it relies on other supportingdepartments for assistancein technicalappraisal of alternativeplans and policies,initiation and development of planning proposals,on-going coordinationwith other authorities,and the detailed formulationof policies,plans and programs. The updating and developmentof road and traffic plans is not handled as a continuousprocess.

18. Dinas LLAJR has responsibilityfor trafficmanagement, which is intimatelyrelated to end dependenton the planning of roads but has, up to now, had little hand in overall road planning. Dinas Tata Kota (city planning)is involved in the planning of networks and roads generallybut mostly for housing and other developmentsof green field sites. Dinas PU (publicworks) j the agency responsiblefor detailed design and construction of local roads._

19. The majority of principalroads in the DKI area have been developed by DG Bina Marga, (or Jasa Marga, the toll road authority),often with the use of overseas funds. Consultantshave normally been employed to assist in the preparationof plans on a scheme by scheme basis. The general alignmentsand design standardshave been set for each scheme by Bina Marga; the selection

1/ It is proposed that Dinas Tata Kota continues to exercise its responsibilities for the planning of roads to provide access within new development areas. Over the general network of roads providingtraffic circulation within the city, however, the traffic managementresponsibilities and experienceof Dinas LLAJR will necessitatethe developmentof an expertiseand interest in overall road and traffic planning. Dinas LLAJR will clearly be in a pre-eminentposition to give advice to Bappeda on matters affecting the general network of roads and traffic circulation, anrtlu iandrSteCS it-i^-teZ - 60 - ANNEX 2 Page 9

and progra ing of schemes has been dependenton the availabilityof loan funds. Since 1982, the design of these schemes has been based on comprehensive traffic forecastsprepared in connectionwith an overall Structure Plan for the year 1985 to 2005 developed by D.K.I.

20. An extensivenetwork of primary roads has been developed in this way. The planning of these roads has, however, been chiefly based on the developmentof a primary network of rings and radials performinga rational function in establishingmain links between Jakarta and the rest of the country and with other facilitiesof national importance,such as the airport. The resultingroad system does not always lend itself particularlywell to the needs of DKI Jakarta in providingfor internal trafficwithin the city. Considerableseverance of land has taken place, making serious difficulties for cross-towntraffic; excessivedistances are travelleddue to inadequateprovision of U-turns and cross-movements;provision for buses could be greatly improved;the planning and implementationof a road system designed to encouragethe stated DKI policy of East-Westdevelopment is still tenuous rather than dominant, and a lack of balance between new constructionof traffic managementproposals is only now beginning to be corrected;and the introductionof toll roads within the urban area has brought disadvantagesto general intra-citymovement. The strengtheningof the DRI to develop its own organizationto encompassroad planning and traffic managementis clearly needed so that full weight can be given to DKI interests,now that a basic frameworkof primary roads has been established.

21. Responsibilitiesfor trafficmanagement and traffic engineeringin DKI lie with lDinas LLAJR. DLLAJR also has responsibilitiesfor public transportregulation and licensing,as describedin Annex 2. Up to now, however, its organizationand staffing and the technicalexpertise available within the organizationhas meant that it has had little opportunityto carry out survey and analysis to provide a basis for developingtraffic management schemes, let alone their planning,design and implementation. The same applies to its sub-dinasconcerned with traffic engineering(traffic signals, traffic signs, etc.); this has been necessarilymainly concernedwith installation,operation and maintenanceand no staff is availablefor survey, planning and design of traffic schemes to tender document stage or to provide supervisionadvice during construction.

Action Plan

22. Objectivesof the Project in relation to road planning and traffic management functionswithin DKI Jakarta are:

(a) Planning and development:

(i) to establishroad planning and traffic planning on a continuingbasis as a part of overall transport planning;

(ii) to establishoverall road planning policies and programs within the context of the Jakarta structureplan; and - 61 - ANNEX 2 Page 0l

(iii) to plan individualroad and trafficmanagement schemes on the basis of surve and analysiswithin the context of overall policy objectives;and

(b) I-pleentation: To prepare and implementindividual schemes in the fields of trafficmanagement, traffic engineeringand parking control

Action Plan

23. In order to achieve the above objectives,Dinas LLAJR, the organization responsiblefor trafficmanagement is being strengthenedconsiderably by reorganizationboth to embody functions,not currentlybeen undertakenand to give increasedpower and ability to carry out other functionsrelevant to the improved managementof traffic on the road system. These new improved capabilitieslie in:

(a) transportplanning; (b) road and traffic planning; (c) survey and analysis; (d) trafficmanagement planning and design; (e) area traffic control; (f) traffic engineering,signs and traffic signals; (g) monitoringof traffic operations.

24. The reorganizationwould be supportedduring the project period by:

(a) introductionof a program for recruitmentof suitable new staff (54 persons over a 3-year period to cover all aspects of reorganization);

(b) introductionof a major programof staff training,in house, at the Road Transportationand Traffic College at Bekasi (both full time and short courses - Annex 5), and overseas;

(d) design and implementationof a program to establisha practical policy of traffic restraintand parking control to reduce congestion in central areas; and

(e) the provisionof technicalassistance from experiencedpersonnei in transportplanning and traffic engineeringin cairying out the above program (Annex 5).

25. The foregoing institutionaldevelopment program for Dinas LLAJR would be carried out in conjunctionwith the strengtheningof the public transport functions(as described in Annex 3, Section D) under the guidance of DirectorateLLAK. ANIU 2 - 62 - Atteeat Paleo IND0NSIA

JA3OTAS3U U3A DEVSLOPIISIT PROJICT

Urban Tranopwrt Action Plan

Conpleted ObJ.sctive Task Action by by Monitor

A. Improve the Institutionalize coordination mecha- TIPP/OCLI/DCBi;/DlI 06/88 Institutional develop- coordination of niem for urban transport planning sent urban transport pol- icie and planning

1. Strengthen Tim Koordinasi (TlPP) to TKPP/DKI/DCBI/DCLT 03/88 Transport planning coor- address urban transport s*ctor dinstion. issues and programs.

2. Establish urban transport capacity DKI/BOTABEE 03/88 Transport planning coor- in Jabotabek IUIDP mechanim. dination.

1. Develop urban Prepare an Integrated urban transport W.PP/DGLT/DCBN/DKI 12/90 Adopt recommendations of transport policies development program and action plans systes review report and strategies for the Jabotabak area

1. System review: DKI/JARAR/Consultants 09/89 Report accepted

(a) Define the transport needs of the Jabotabek area based on existing studies and data.

(b) Evalu*ta role and capacity of all DKI/JA8SR/Consultants 09/89 Report accepted existing modes and networks.

(c) Identify principal transport cor- DKI/JABAR/Consult.;ts 09/90 Report accepted ridors and prepare policiea and plans for an integrated transport system including mass transit options.

2. Action plans: DGLT/DKI/JABAR/ 03/91 Report accepted Consultants (a) Develop action plans for road, rail, bus and other modes.

(b) Evalucte role and options for sass DKI/Consultants 03/91 Report accepted transit.

(c) Carry out feaibility studies to DKI/Conoultants 12/91 Report accepted develop an integrated mass transit system for DKI Jakarta.

C. Improve the Bus Transport efficiency and 1. lmprove planning and regulation of LLAJR/DCLT/Consultants 12/90 New plans and regula- performance of the bus services by strengthening DCLT tions existing road and LL.AJR. transport systems and networks

2. Improve management, operations and PPD/Consultants 12/90 Meet targets agreed in finance of PPD. PPD/DAJRI action plan

3. Encourage efficient complementary LLAJR/Consultants 01/89 Possible additional private-aector operations. co_mence routes

Road Network 1. Develop parking and traffic DfI/Consultants 12/89 Reports. parking i_- restraint stratey. provements

2. Implement existing traffic anage- DKI/Consultants 06/88 Improve traffic flow ment. control and bus priority co_ence program.

3. Develop and implement traffic en- SATALANTAS/Consultants 01/89 Improve traffic flow forcement program. co;ence - 63 - 3 Page 1

INDONESIA

JABOTABEKURBAN DEVELOPMENT PROJECT

Public TransportOperations in Jabotabek

A. Overview

1. Public transportis currentlythe major means of personal movement in the larger Indonesiancities. In the Jakartametropolitan area (Jabotabek) both rail and road-basedpublic transport is available. In other cities road- based transportis generally the only availablemode for intra-citymovements by public transport. Even in Jakarta the railway (a commuter systea between Jakartaand the surroundingBotabek area), carries only about 22 of motorized trips--approximately55,000 passengersper day. About 7 million (or 54x) of Jabotabek'stotal of 13 million trips/dayin 1986 were motorized with about 91X of all trips occuring in Jakarta. Road-basedpublic transport (buses, taxis, and bajajs) operated by the private and public sectors carries 52.22 of motorizedtrips. Total trips in Jabotabekare estimated to increase to about 22 million by 2005 and about 15.5 million of them would be motorized. Coping efficientlywith this increase requirescareful planning for maximum use of public transport. A discussionof the integrated,multi-modal approach requiredto provide a cost effectivesolution to Jabotabek'surban transport needs is given in Annex 2. The approach would include improvementsto the efficiencyof the bus and railway state enterprisesconcerned.

2. Both existing public transportmodes in Jabotabek suffer from severe institutionaland financialproblems. The State Railway (PJKA) operationsare unprofitableir. general and current investmentplans for ugrading the Jabotabekcommuter rail system (totallingalmost $2 billion) are unlikely to make a significantpositive impact on serving the potentialtrip demand or the financialperformance of PJKA. On the other hand, Jakarta's large bus operator,the state enterprisePPD (which serves 44X of all trips by public transportin Jakarta) is also unprofitableand provides a low level of service. The enterprisesincur operatingdeficits related to their Jakarta operationstotalling about Rp 29 billion/yearon average. In addition Central Governmentis currentlyresponsible for financing their capital expansion programs in Jakarta totalling some Rp 87 billion/yearon average.

3. Following is a discussionof the issues relating to the efficiency of the public transport institutionsin Jabotabek. Part B will address the State Railway (PJKA) and Part C the State Bus Companies (PPD in Jakarta and DAMRI in regional cities), includingthe actions agreed with government intendedto address their respectiveissues. The PJKA action plan development would, however, depend in part on the findings of the consultantsto be engagedunder the forthcomingRailways TechnicalAssistance Loan negotiated recently. The PPD and DAMRI action plans will be addressedunder the present projecttogether with strengtheningof the bus transportregulatory environmentdescribed in Part D. - 64- ANNEX 3 Page 2

B. JabotabekRailway System

Urban Transportin Jakarta

4. Recent surveys undertaken in 1985 for the Arterial Road System DevelopmentStudy (ARSDS)in the Jakarta metropolitanarea, show that there are some 13 million person trips per day (of which 7 million are motorized). The largestproportion of these trips (91.3%) are made by DKI Jakarta residentswithin the DKI boundary. About 4.3% of person trips (608,000)are betweenJakarta and the Botabek area and the remainderare trips within the Botabekarea, and a small number of through trips. Of the 608,000 trips between Botabek and Jakarta only 76,000 are "to work" trips. Thus, there is very little current demand for commuter services between Jakarta and Botabek.

5. The ARSDS surveysalso highlighted: (a) the heavy reliance on public transportmodes (53.9% of motorizedtrips); (b) the major importanceof the bus system (52.2% of motorized trips) and (c) the very minor role of the rail system (1.7% of motorized trips - approximately55,000 passengersper day). Because of the under supply of buses and the improved economic circumstancesof the citizens, taxis and bajas are playing a more important role. In Jakarta itself, 50.2Z of motorizedtrips are made by public transport49.8% by bus and 0.4% by rail. In the Botabek area 63.7% of motorized trips are by public transport,56% by bus and 7.7% by rail. It is clear therefore,from the above, that the real system contributesvery little to the Jakarta public transportsystem and plays a minor role in the Botabek area.

Future TransportationDemand

6. Although, several estimateshave been made of the future demand for rail, there is a divergenceof opinionas to the likely future modal split. The revised rail feasibilitystudy, by the JARTS rail study team in June 1985, predicts 15% of trips by rail in 2005--26 times greater than at present. This study states that for rail to achieve this level of usage it would be necessaryto provide significantbus feeder services to the railway lines.

7. Figures from the ARSDS study estimate 22 million person trips in 2005 (15.5 million motorized)and indicatethat the maximum likely demand for a well improved rail system in 2005 would be 5.9% of motorized trips - 16 times greater than at present. Without the large investment in rail the proportionof trips by rail would be 2.1%. These recent estimatesappear more reasonablegiven the fact that: (a) they are based on recent survey data; (b) the railway lines are not well placed with regard to the planned activity centers set out in the Jabotabekmaster plan; and (c) the increasingtrend for manufacturingand residentialgrowth to Locate in the Botabek area.

8. Within DKI-Jakartathe ARSDS study predicts that by 2005 only 0.4% of motorizedtrips would be by rail. It is clear therefore,that the proposed Jabotabekrail system will not have a significantrole in resolvingurban transportationproblems in Jakarta. Nor will it be the most cost effective method of resolving the problems of transportationin the Botabek area. The -65- AM=K 3 Page 3

rail proposalshave been justifiedby the relief they are supposed to bring to the road network by reducing demand for road space. However, the level of demand and its dispersedpattern are such that a more cost-effectivesystem could be achieved by the use of buses.

The Rail System

9. The master plan for the Jabotobek railway system involves the upgrading,expansion and improvementof about 175 kilometersof existing railway track which currentlyserves multiple uses (long and medium distance passengerservices, commuter services and freight and goods transportation). The proposed master plan for the Jabotobek rail system concentrateson the commuter rail function with the objectiveof improvingregional passenger services linking Bogor, Tangerang,Bekasi, Serpong and Tanjungpriokwith each other, and with Jakarta. Because of its limited coverage, both in the Botabek area, and in Jakarta, and the need for railway track to serve multiple uses, the system would never be able 9 operate as an urban mass transit system to serve the needs of DKI Jakarta.-

The Costs

10. The implementationof the Jabotabekrail master plan would be completed in four stages by 2002. The total cost of the plan based on October 1987 prices is Rp2 ,260 billion (US$1.98 billion) of which about 70Z is in foreign exchange.- The average annual investmentof the program over the eighteen year period of the plan is Rp 220 billion (US$133 million). The costs of each stage in local and foriegn currencies are shown in Table 1.

1/ The maximum headways that could be achieved with such a system,after considerablesignalling improvements, would be six-to-eightminutes. A mass transit system would normally require two-to-threeminute headways, which would only be possible on an exclusive rail track with grade separationat crossoverpoints. The low ridershipwould not justify such improvements.

2/ The unit costs of major elements of the system such as the proposed 8.5 km elevationof the Central Line appear quite high not only due to the complex structuresinvolved but also because all existing stations will be rebuilt. A solutionneeds to be found to the problem of the 22 level crossingsthat would be eliminated by the elevated section but the mission was unable to determine that the least cost solution to this problemhad been found. While an overall justificationfor the project was provided in the feasibilitystudy of the system, the designs of specificcomponents of the system need to be reviewed to ensure that costs have been minimized adequately. - 66 - ANNEX 3 Page 4

Table 1: JABOTABEKRAILWAY IMPROVEMENTESTIMATED COSTS

Local Foreign /a Total (Total) (Rp billion) (US$ million) (Rp billion) (US$ million)

Stage 1 1985-87 210.37 214.67 654.58 342.16 Stage 2 1988-92 400.82 577.05 1,352.95 819.97 Stage 3 1993-97 81.03 195.49 403.59 244.60 Stage 4 1998-02 271.78 404.38 939.01 569.10

964.00 1t391.59 3,260.13 1,975.83

/a All of the foreign exchange spent on the project to date (11% of the total) has been in Yen loans, over 30 years, at twc and one half percent interestrate. Loans for Stage 2 are being negotia,edwith the Governmentsof Japan and France.

ImprovementStages

11. The principal project items in each stage are listed in Table 2 below. Stage 1 is almost complete and the preparationof Stage 2 is well advanced. Stage 3 and 4 are still at a preliminarydesign stage. The major feature in Stage 2 is the elevationof 8.5 kilometersof the central line between Manggaraiand Jakarta Kota. This sectionof the line crosses 21 roads and contains 7 stations. These works will be completedin three sections. Work on the first sectionrepresents about 38Z of the total Stage 2 costs and has reached an advanced stage of tendering. Other planned Stage 2 works involve, the rehabilitationof 3 depots and a workshop, the completionof the loop around the center of Jakarta, the doubling of track, electrification,a new stationand the purchase of new electric rail cars. - 67- ANNEX3 Page 5

Table 2: JABOTABEKRAILWAY MASTER PLAN COMPONENTS 1985-2002

Component Description

Stage I (1985-87) Western line: ElectrificationManggarai-Kampung Bandan-Jakarta Kota Central line: Doubling of track Duren Kali Bata-Dcpok New station, Universityof Indonesia Diesel cars (20); electric cars (20) Power supply improvementand minor items

Stage II (1988-92) Central line: ElectrificationManggarai-Depok; Jatinegara-Bekasi Doubling of track Manggarai-PasarMinggu Elevationof track Jakarta Kota-Manggarai(8.5 km) Loop: New station, Kampung Bandan Doubling of track, Kampung Bandan Tangerangline: Rehabilitationof track and signals Serpong line: Rehabilitationof track and signals General: Depot (3) and workshop improvements Additional 64-110 electric cars Minor items

Stage III (1993-97) Tangerang line: Doubling of track * Serpong line: Doubling of track Central line: Grade separationManggarai and Jatinegara Additionalelectric rail cars Minor items

Stage IV (1993-97) Additional cars (totalling908 electric rail cars) Double track, new line Jakarta Kota-Airportand Tanjungpriok-Cibinong Minor items

Issues

12. The most importantissues are: (a) the scale of the proposed railway improvementprogram, and (b) the imbalancebetween the level of investmentin railway with that proposed for bus transportationin Jabotabek. The proposed average annual expenditurefor the rail system over eighteen years will be Rp 180 billion. Over the next five years the average annual expenditurewill be even higher reaching almost Rp 270 billion. To spend such huge sums of money to benefit, at the best, of less than 1% of Jakarta based passengermovements and 6X of Botabek passengersmovements, could constitute a seriousmisallocation of resourcesunder present circumstances. For example, as an alternative,a small fraction of this expenditure - 68 - ANNEX 3 Page 6 could providemajor improvementsin mass transportationin Jakarta through the introductionof segregatedbus ways and expansionof the bus fleet.

13. The scale of the project is out of balancewith the rest of the PJKA operations. Even with the expected soft loan conditions,the annual loan repaymentsafter stage 2, would be approximatelyequivalent to the existing net annual operatingloss. The abovementionedJARTS revised feasibilitystudy says in this respect that, "...the financialaspects of the project are not necessarilyoptimistic and the Governmentmust be prepared to support the projecteven after the construction,mainly in servicingdebts." Any hope of PJKA reaching some degree of self sufficiency,and reducing operating subsidies,would be out of the question for several decades, if the current program of investmentis maintained.

14. While there is no doubt that the scale of the proposed Jabotabek passengerrail system is questionable,the existing rail infrastructureand services provide a transportationresource the use of which, if continued, could be improvedat a lesser cost by: (a) providingbus feeder services to the main stations;and (b) completingthe loop around the center of Jakarta. Other cost effectiveimprovements at an affordablescale could then be implemented over in the longer term. Future intermodaltransport planning in Jabotabekshould provide for maximum use of the existing rail system, thereby helping to reduce overall transport system costs in Jabotabek,and improve PJKA revenues,although a financiallyviable service is still unlikely.

15. The present plan seems to have been conceivedin the absence of a wider, integratedurban transportationplan for the Jabotabekregion and, moreover, is now inconsistentwith Central Government'sconcerns over its budgetaryconstraints. Under the GOI's forthcomingintegrated urban transport planning exercise for the Jabotabekregion, the role and capacity of Jabotabek Railway would be evaluatedand appropriatemeasures adopted into an action plan for (a) the integrationof the railway system into a least-costoverall solutionand (b) improvementin its operationalefficiency. The evaluation would be carried out by DGLT with technicalassistance provided by the Governmentof Japan. The Government of Japan will also assist PJKA during 1988 in the planning of bus feeder services and other measures intended to maximize effectivenessof the railway as an urban transportmode. The findings of the evaluationand planning would be made availableto and discussed with the Bank. The conclusionswould be incorporatedinto the integrated transportplan to be prepared by DGLT, DGBM and DKI with assistance provided under this project (see Annex 5 for TOR). Under the terms of the abovementioned Railway TechnicalAssistance Loan, the Governmenthas initiated an accountingsystem for the Jabotabek Railway to create a separate cost center in PJKA accounts. Experiencewith the operatingresults obtained from these accounts would be used to help determinean institutionalaction plan of measures intendedto improve the Jabotabek railway system efficiency. - 69 - ANNEX3 Page 7

C. PPD and DAMRI Bus OperationsAction Plan

JakartaBus Company - PengangkutanPenumpang Djakarta (PPD)

16. Background. PPD State Enterpriseis the major bus operator in Jakartawith a fleet of about 2,000 vehicles, including400 double deckers. PPD is licensed to operate 1,823 buses on 105 routes entailing a minimum output of 1,500 buses. In practice the daily output seldom exceeds 1,100 buses and may fall short of this figure during the day as a consequenceof breakdownsand staff failures. There are 289 licensed bus routes serving the city, the remainderbeing operated by the private sector, includingone large bus operator with 880 conventionalsingle-deck buses, and around 4,000 inde- pendentlyowned mini-buses and para-transitvehicles. A significantproportion of the PPD operationwas originally in private ownership but had been unable to remain viable as a consequenceof a government-controlledlow fares policy. Fares were increased early in 1987. Since 1983 PPD has been engaged in rationalizingits structureand operationalpolicies. New Directorswere appointedin 1985, four having held managementposts in the undertaking,the TechnicalDirector coming from DGLT office. During 1984/85 consultancy assistancewas obtained from London TransportInternational (LTI) dealing with fleet maintenanceand associated supply problems and during 1985/86 there was a major study of operations(funded from Loan 2049-IND Jakarta-Cikampek Highway Project) which has made numerous recommendationswhich could lead to an improvedoperational performance and the eventua;lviability of PPD. Until a viable performanceis demonstratedPPD operationswill be consolidatedand no further expansionpermitted.

17. Key Problems. Key performanceindicators for PPD and DAMRI operationsare shown in Table 3 below. In common with most major city bus operatorsPPD is beset by problems, the most significantof which are as follows:

(a) ManagementStructure. PPD does not own its bus fleet which is bought and owned by the Ministry of Finance, nor does it have in practice the appropriatecapital and accountingstructure for a State Enterprise. Reportinglines are divided between the Ministriesof Finance and Communicationswith some conflict of objectives. In the circumstancesit is difficult to establish the actual financialposition of the undertaking,or the actual cost of providingthe public bus service in Jakarta.

(b) Bus Rental Payment System (WAP-WajibAngkut Penumpang). Crews pay a pre-determinedsum of money to PPD, based on the outcome of a passengersurvey, for operatinga bus on a route and keep the remainderof the revenue collectedfrom passengers. The system is describedi4detail in the above mentioned PERUM PPD Operations Study 1986.1" For PPD to maximize its revenue it is essential to have an accurate base count of passengerscarried on each service,

2/ In Project File (see Annex 12). - 70 - ANNEX 3 Page 8

but it is evident that the passengertotal on which WAP is based has been seriouslyunderestimated, causing a substantialloss of revenue. The calculationis made on a per bus basis with adjust- ments being allowed for buses which do not complete a full shift, student cheap travel, etc. Thus with a regular failure to meet the licenseddaily output and some evidence of manipulationby crews to maximize their earnings (delayingdepartures from termini and other restrictivepractices) giving an irregularand unreliable service to the travellingpublic, there is a leakage of a significantproportion of potentialrevenue. The operationsstudy indicatesthat this leakageconstitutes as much as 75Z of crews "wages" and the leakage may overflow into other staff groups. Comparisonbetween a revenue forecast supplied by PPD and a conservativeestimate (on the basis of 1,000 buses carrying 1,000 passengerseach on 313 days a year) shows that there is a possible shortfallof Rp 7.2 billion when allowancesfor student travel and other adjustmentshave been taken into account. The actual loss may be much greater.

(c) Flees Maintenance. The proceduresfor planned maintenancesuggested in the LTI study have only been introducedat two depots and the overall conditionof the fleet gives cause for concern. Daily availabilityis consistentlybelow 60% and the consequentialand consistentoverloading of vehiclesmust cause prematurefailure of engines, gearboxesand suspensions. Vital tools and equipment items are not availableat depots, often due to lengthy procurement procedures,and there is an urgent and continuingneed to improve the skills of workshop staff so that better use can be made of the facilitiesavailable. Though many are only five years old, more than fifty of the double deck buses are out of service due to lack of spares or followingserious electricai fires. Many of these buses have been completelycannibalized.- Performancevaries considerablybetween depots. On consecutivedays in October 1987 one depot achieved 86 on the road from 116 double deckers (74%) A'ilst another depot only ran 150 from 232 single deckers (64%)

(d) Reductionof Costs. A significantcost for any bus operation is the level of manning and the Operations Study identified14.5 employees per PPD bus operatingat November 1985 comparedwith ratios of 7:1 in the private sector and 6:1 in DAMRI operations. The ratio of drivers and conductorswould be correct if PPD was achievingan output of 1,500 buses each day; nevertheless,service buses are often cancelledbecause of crew shortage. The ratio of administrative staff per bus is high even though by comparisonwith conven- tional bus operationsPPD have no staff engaged on time schedule compilation,ticket handling, publicityor marketing.

3/ A major reconstructionexercise would be required to make these buses fit for service and a cost of Rp 50-60 million per bus has been suggested. New single deckers with substantiallylower operationalcosts and simpler ftaintenanceneeds could be purchasedfor the same outlay. - 71 - ANNEX 3 Page 9

(e) Quality of Service. Becauseof the combined effects of vehicle shortageand the WAP system,PPD has limitedcontrol over the quality of serviceprovided. Routes are licensed for a specific number of buses (includingprovision for 15% spares) but vehicles are tied to the licensed route giving no flexibilityto deal with serious shortfallson other routes caused by mechanicalfailures. The license is not specific regardingthe actual number of trips to be provided in the course of the day or at any period of the day. PPD does not issue a time schedulebut crews are expected to perform a number of trips consistentwith the estimated journey time and the length of shift. In practice the drivers play a large part in determiningthe pattern of service as they manipulate journeys to maximize earnings above their WAP requirement. Whenever possible departuresfrom the terminalare delayed to ensure that buses are well loaded and the consequentialgaps in service become further extendedwhen traffic delays are encounteredalong the route, especiallyat peak travel times. Conditionsat termini are far from ideal as big buses and minibusescompete for inadequateroad space and passengersattempt to interchangebetween services. Buses are frequentlyseriously overloaded, to the extent that danger exists of boarding or alightingaccidents or from the consequencesof a seriouscollision or bus fire. Public informationregarding routes and frequenciesis virtuallynon-existent (Dinas DLLAJR publish a list of all licensed routes but first or last times are not shown nor is there any indicationof service frequency). In the circumstances it is not surprisingthat many employershave commissioned private charter services to ensure that staff without personal transportare able to get to and from work. Without the provision of an attractive,regular ar;dreliable service there is a real possibilitythat the PPD share of the public transportmarket will be further eroded by private operators.

(f) FinancialPerformance. Since it has the status of a Perum the governmentexpects PPD to operate on a commercialbasis and make a profit. Some services (around 30%) are pioneer or otherwise unprofitableroutes required by the Government of Indonesia for social reasons. Overall profitabilityhas not been achieved and in recent years PPD has incurred substantiallosses, partly due to the government'spast policy of low fares but also due to its own poor operationaleffeciency. A major factor has been the operationof the double deck fleet with its higher first and subsequentrunning costs. Direct operatingcosts have not been covered leaving large sums to be found from the public purse. By comparison,in a similar operationalenvironment the private large bus operator,appears to have remained profitable. Recent performancefigures provided by PPD are set out below: -72 - ANNEX 3 Page 10

1985 1986 1987 /a

Revenue 20.9 35.6 22.7 Direct costs 20.4 37.8 18.1 Indirect costs 0.5 3.6 1.0 Other expenditures 6.2 10.2 9.1

Deficit 7.2 16.8 6.2

/a 1985 PPD 1 only 1986 PPD 1 and PPD 2 1987 PPD 1/PPD 2 First six months only

(g) EnvironmentalMeasures. Tvo aspects of environmentalpollution have a bearing on the activitiesof PPD. Even through buses form a small proportionof the total traffic generatedemissions, it is important that PPD is seen to be taking effective steps to deal with excessive smoke from buses. Under normal circumstancesfuel economy measures as part of an effectiveroutine maintenanceplan will also result in smoke reduction.

18. Actions Taken to Date. In some of the problem areas action has already been initiatedas follows:

(a) WAP System. In general the only action taken has been to revise the WAP payment to reflect the March 1987 fare increase. Some routes have had new passengercounts, but the effect has been minimal and PPD revenue losses remain significant.

(b) Fleet Maintenance. The effect of measures taken to date has been to improveaverage output by 50-100 vehicles a day, but it still falls 400 short of the 1,550 basic licence requirement. Based on projectednew bus deliveriesPPD expects to have 1,823 operational vehicles by January 1988 with a potentialdaily output of 1,463 buses. By September1988 there should be an operationalfleet of 1,916 buses (including76 single deck and 15 double deck spare buses). This should be sufficientto ensure the licensed output of 1,500 buses each day. The measures taken to date are as follows:

(i) In accordancewith suggestionsmade by the LTI team and endorsed by the OperationsStudy, buses have been reallocatedso that each depot deals with only one type of vehicle. This has a direct benefit in stores control and parts stocking,as well as reducing the skill span necessaryfor maintenancetasks. Standard maintenance proceduresare possible and this in turn makes the task of work allocationand supervisionless onerous.

(ii) 774 new single decker buses are in course of deliverv. The majority are intended to replace out-datedand o'der vehicles,but some are intended for fleet expansion end the operationof new services. 447 of these buses are -73 - ANNEX 3 Page 11

already in service,and completionof the contract by March 1988 will constituterenewal of one third of the PPD fleet. In addition 40 additionaldouble deckers are due to enter service early in 1988. If earlier experience with these sophisticatedbuses is any indication,their nuisance value wtl outweigh any short-termcontribution to fleet output.-

(iii) A new central overhaul facility at Bekasi is in course of constructionby DGLT capable of dealing with a fleet of 4,000 vehicles. Whilst this may be a generous over- provision,it will create a facility to undertake the heavy repair and reconstructionof PPD buses among others, freeing PPD depot resourcesto concentrateon routine maintenance,inspections and rectification. The works is expected to be operationalearly in 1988, but operational and financialobjectives have not yet been determined.

(iv) PPD have in preparationa program of depot rehabilitation covering eleven locations,improvements to the head office premises and the constructionof a new depot. Outline costs of this program are about Rp 17.75 billion; funding sourcesare not confirmed.

(c) Reductionof Costs. Some positive steps have been taken in reducing excessivestaff costs. There has been a freeze on recruitmentand total staffingat the end of September1987 was 14,479. This com- pares with 16,663 in November 1985. During the same period maintenance staff have increasedby 128, a feature that must be welcomed. PPD has identifieda lack of managerialskills and will be recruit- ing 12 graduatesunder a program prepared by the Universityof Indonesiaamong others and covering a variety of specialistareas. Subject to final agreement of contractsthe Universityof Indonesia is expected to also be involved in a project 3 determine an optimum staffing level on a per bus basis which will ue useful in guiding future policies. Steps have been taken to introducea career structurefor managers and to this ent,depotshave been classified by size and type of vehilce operated., A progressivedisciplinary system exists for dealing with persistentabsenteeism and other offences,and at one depot 27 staff had been dischargedduring 1987.

4/ Fleet expansionand replacement,bus specificationand procurementare not controlledby PPD but by a DGLT committee. Full control of such decisionsby PPD in future would be an importantaspect of its restructuredoperations.

5/ Thus a Class 1 depot has 200 single or 120 double deck buses, Class 2 has 160 single cr 80 double deck, Class 3, 120 single deck and Class 4, 80 single deck. _ 74 - ANNEX 3 Page 12

(d) FinancialPerformance. As indicatedin the previous section, performancein the first six months of 1987 was better than in 1986, but this is largelydue to the effects of the fare increase. Worth- while improvementswill only flow from a much more realistic approach to the level of revenue obtained through WA? coupled with a dramatic reductionin staffing levels. The Ministry of Finance has announcedthat there will be no subsidy for bus operations in 1988. Whilst this may be achievablein the actual cost of operation, it may not be appropriateto expect PPD to provide non-viable social serviceswithout some form of targettedsubsidy.

19. Action Plan. An Action Plan for improvementof PPD operationsand finances is set out in Table 4. Technicalassistance would be provided to PPD to help implementthe plan and train staff (for TOR see Annex 5). Five principalobjectives have been identifiedfor the Action Plan as follows:

(a) Strengthenthe CorporateManagement Structure

- PPD to become a properly constitutedPerum with an appropriate organizationaland financialstructure and a full public utility accounting system.

- Bus fleet ownershipto be vested with PPD.

- A Deputy PresidentDirector to be appointedwith adequate authorityand responsibility4 n all functionalareas to ensure that the Action Plan is effectivelyimplemented.

- Corporateand operationalplanning functionsto be strengthened.

(b) Improve Revenue and FinancialPerformance

- WAP to be revised to reflect an accurate passengercount for all services,and wages and salaries adjusted to compensate for eliminationof the existingunofficial reward system. WAP to be calculatedas a daily figure for each route and levied accordingto the number of buses operated instead of the present deduction on a per bus basis.

- PPD to maintain control of WA? with a continuousmonitoring system updating the initial blanket survey.

- Alternativemethods of fare collectionto be studied to see if a cost effective system is availablewhich will meet the operationalsystem in Jakarta. - 75 - ANNEX 3 Page 13

- Bus output to attain consistentachievement of 75Z of license figure by June 1988 and no less than 85Z by December 1988.

- Breakdownsin service to be reduced by 501 by June 1989.

- LTI maintenanceprogram to be introducedat all depots by June 1989.

- CentralWorks project to be reviewed by DGLT and appropriate service to be provided to PPD at cost.

- Decision taken to repair or scrap derelict double deckers.

- Early decision required whether serviceabledouble deckers should be replaced or overhauledto give a further 5-6 years service.

- Tools and equipment procurementprogram establishedfor all depots.

- Skill training program introducedto develop the ability of existingmaintenance staff.

- Possible introductionof incentiveschemes based on vehicle output and breakdown reduction.

- Establishmentof emergencyrepair teams so that routine maintenancework is not disrupted by requests for rurnning repairsand immediateaction.

- Establishmentof spare vehicle float to cover "casualties."

(d) Reductionof Costs

- Universityof Indonesiaprograms to be expeditedand implemented.

- Graduate entrant program developed to determineoptimum number of continuingprogram.

- PPD to issue formal guidance on expected levels of attendance and performancefollowing WAP revision.

- Further training opportunitiesto be provided for supervisors and managers (e.g. DGLT Training College short courses in public transport). - 76 - ANNEX 3 Page T4

(e) Quality of Service

- Route costing formula to be developed to permit targetted subsidiesto pioneer, protocol and social services.

- DLLAJR/PPDto define trips per hour on route licenses.

- PPD to develop basic time schedule for each route to improve performanceand set up monitoringprocess.

- DLLAJR/PPDto establishformal recordingprocedures for arrivals and/or departuresat major termini. Possible use of mechanicalor computer recordingto be investigated.

- DLLAJR to consider implementingthe 1982 Bus Stations report to improvepubic access to services and facilitate interchange between routes.

20. Privatization. Promotionof private sector public transport operationsis one of the policies set out in the Minister of Communications Decree No. 91/1987. However, it is also Government'spolicy at this time to provide publicly owned services on all strategicroutes in larger cities in order to ensure an adequ.te,reliable transport service in view of the possible social and politicalramifications of an unreliable or interrupted private service. Official policy restricts private services to non-strategic or feeder routes. Notwithstandingthe failure to private services in Jakarta i3 the past (during the period of heavily controlledfares), private large bus operationsin Jakarta appear to be profitableunder the new fare structure. Privatizationof PPD operationswas an option consideredby the Government as an alternativeto the restructuringnow proposed. However, the relatively profitableperformance of Perum DAMRI (as discussed below) offers some hope that the PPD operationsmight be continued successfullywith appropriate measuresas describedabove. PPD will be monitored closely in its efforts to achieve its new financialand service objectives. In the event that PPD does not perform satisfactorilyon any of its routes by due date, its licenses for those routes will be revoked and the routes turned over to the private sector and further restructuringcarried out. It is expected that this approach would be repeated for a further cycle but in the even that improvementis not shown, additionalmeasures may be applied in time, such as privatizationof certaindepots, installationof a private operating company, or indeed, privatizationof the entire operationshould conditionsdeteriorate sufficiently.

RegionalCities Bus Company - Perum DAMRI

21. Perum DAMRI provides bus services in about 8 larger cities under the directionof a central head office in Jakarta. During 1985 a study of DAMRI operationsin the four largest cities served (Bandung,Medan, Semarang and Surabaya)was carried out by consultants(study in Project File, see Annex 12). The study was limited to these cities in order to complement the ongoing RegionalCities Urban TransportProject (assistedby Loan 2817-IND). Revenues from these operationsconstitute about [70%] of DAMRI's overall revenue. As - 77~ -ANNEX 3 Page 15 may be seen from Table 3, DAMRI performanceindicators are relatively good. However, some improvementsare desirableas discussed below and an action plan (Table 5) and consultantsassistance (outlineTOR are given in Annex 5) has been providedfor in the project. The followingdiscussion focuses mainly on DAMRI's operationsin Bandung which are not un-typical of problems and approachesapplicable to all DAMRI operations.

22. Background. DAMRI was establishedin Bandung in May 1978 with 68 buses. Daily output of 54 buses carried 16 million passengerson one route. By 1986 the fleet had grown to 229 with 140 in daily service on 9 routes carrying 54 million passengers. In October 1987 there was a fleet of 227 buses of which 181 were operational. Budgetted staff strength of the unit was 1,080 with 1,048 actually in post giving a ratio of 1:5.8 per bus. In 1986 the Bandungunit produced a small profit having covered all local costs and made its 40Z contributionto central overheads (includingprovision for depreciationand interest). Plans have been made for four new routes which will be opened up as additional buses become available. These routes are currently served by privateminbuses but it is anticipatedthat the lower fares of DANRI (Rp 150 compared with Rp 200-350)will attract enough passengers to make the DAMRI operationsviable. There are currentlyabout 4,000 minibusesand para-transitvehicles in the Bandung area.

23. Key Problems and PotentialRemedies. Although,on the evidence from Bandung,DAMRI does not face the problemsof PPD, there are areas where significantimprovement could be achieved.

(a) ManagementStructure. In common with PPD most of the DAMRI fleet has been purchasedand is owned by the Ministry of Finance. Provi- sion is made for depreciationand interest:payments but the situation could be improved if full Perum status cculd be achieved with complete financialaccountability and capital structure. This would reveal the true financialsituation of each DAMRI unit.

(b) Fares System. All DAMRI urban operationsutilize an accountable ticket systemandin consequenceare much more aware and in control of their total revenue. A major revenue leakage was identifiedand eradicatedin Surabaya and at Bandung 10 conductorshave been dischargedduring 1987 for ticket offences. Ticket and security proceduresshould be reviewedto reduce losses and en route ticket checks should be reinforced. In Bandung passengertotals are reviewed each month as a means of checking on potential revenue and the possibilitvof introducinga continuousmonitoring procedure should be examined. Existing statisticsand returns would be adapted to analyze individualroute revenues and costs. This would permit the allocationof targettedsubsidies should the need arise, as well as assisting in the determinationof service levels.

(c) Fleet Maintenance. If the Bandung unit is typical this is the most critical area for DAMRI. From the whole fleet of 225 there is 63% availabilitybutif 46 withdrawnbuses are disregardedthere is 77% availabilityof the operationalfleet. This is achieved despite the most primitiveengineering facilities with minimal pit provision, - 78 - ANNEX 3 Page 16

shortage of tools and equipmentand an inadequatesupply of necessary vehicle spares.-/ Bandung buses have daily oil and brake checks with mileage based maintenanceroutines leading up to overhaul at 20,000 kms. Daily maintenanceneeds are well documentedand subject to availabilityof spare parts some ove:nightrepairs are undertakenin order to maximize morning output.

(d) Reduction of Costs. The bus/staff ratio at Bandung is now 1:5.8 compared with 1:7.2 in November 1985 and unlike PPD some DAMRI staff are employed on ticket and schedule preparation. The only apparent staff economy of any significancewould be to reduce the number of conductorsto one per bus and this may not be practicablein the short term. The managementpresentation indicated that costs were kept under stringentcontrol but a further review may be worth- while. Efficiencyindices for Medan suggest a deteriorationin the staff ratio since November 1985.

(e) Quality of Service. Bandung buses are issued with individualtime- cards and arrivals/departuresare recorded at termini with adjust- ments being made by the timekeeperto ensure regular intervalsin the event of scheduledbuses breaking down or not entering service. Bandung route 1 operates at 1-1/2 minute intervalsat peak times and observationat a terminal confirms that this frequencyis maintainedand well supervised. Route informationappears in the local press. Bandung buses carry ovcr 1,000 passengersper day but in a city with a populationof 1.5 million there is potentialto develop passengercarryings well beyond the current 54 million per year. As indicatedabove there are plans for additionalroutes in Bandung. Similar situationsapply in Medan, Semarang and surabaya, suggestingsituations apply in Medan, Semarang and Surabaya, suggestingthat despite the alternativeminibus and para-transit facilitiesavailable in each city DAMRI could increase its market share if serviceprovision and quality was improved.

(f) Financial Performance. On the evidence available from Bandung competentmanagement can produce not only operationalprofit, but also financial self sufficiency. There is ample passengerpotential in each of the cities to achieve or come close to profitability

6/ The Bandung fleet is made up of 112 Tata buses dating from 1977 (41 now withdrawn),50 Hino and 60 Mercedes. The Tata buses, designed and built in India are well suited to Indonesianconditions and there are 420 in the DAMRI fleet. Despite their conditionsand there are 420 in the DAMRI fleet. Despite their age they are regarded as the backbone of the Bandung fleet. Unfortunately,spares are in short supply so that canni- balizationis necessary. When new the Tata buses cost $21,000, at the same time a new Mercedes cost $36,000 (for a less robust bus). If vehicle purchase decisionswere in the hands of DAMRI it seems likely that operationalfactors would be given proper weight with better provisionbeing made for procurementof spares. _79 ANNEX 3 Page 17

though in the short term it may be appropriateto provide targetted subsidies for sociallynecessary routes and injectionsof capital to provide adequate maintenancefacilities.

24. Action Plan for DAMRI. The Action Plan is set out in Table 5 below but some specific commentsfollows:

(a) StrengthenCorporate Structure

- DAMRI to become a properly constitutedPerum with a capital structureand full public utility accountingsystem.

- Bus fleet to be vested in DAMRI.71

(b) Improve Revenue and FinancialPerformance

- Devise route costing system to permit subsidy payments where appropriate.

- Strengthenticket checking and security.

- Introducecontinuous monitoring of passenger carryings.

- Program to improve maintenancework area facilities.

- Program of tools and equipmentprocurement.

- Skill training program introducedto develop the abilitiesof exicting staff.

- Establishmentof spare vehicle float to cover "casualties." Revise license conditionsto permit vehicle flexibility.

- Workload plans and output targets for all depots.

- As in the case of PPD the economics of retainingdouble deck buses in the DAMRI fleet should be fully evaluated.

7/ Subsequent to the bus fleets being transferredto the ownershipof PPD and DAMRI the possibilityof devising a combined vehicle replacementand rehabilitationprogram should be reviewed. This review should take into account the central overhaul facilitiesof both undertakingsgiving particularattention to possible mutual use of the new PPD overhaul works. - 80 - ANNEX 3 Page 18

(d) Reductionof Costs

- Training opportunitiesfor supervisorsand managers.

- Review conductor staffing level. One per bus in off-peak as first step.

- Introducecomputer reportingand informationsystems where practicable.

- Review journey times foilowingtraffic management improvements.

(e) Quality of Service

- Comprehensivedemand survey in each city to determine optimum route pattern.

- Develop mechanical/computerlogging of terminal times.

- Improve publicity and image.

D. Bus Transport Planning and Regulation

25. Role of Government. The effectivenessand feasibilityof the PPD and DAMRI action plans will be severely handicappedwithout (a) concomitant strengtheningof the regulatoryauthorities; and (b) improvementsin route and operations planning,as well as (c) bus priority measures in the road network; and (d) enforcementof the traffic regulationsconcerned.

26. Large size city buses, both publicly and privately-owned,are licensed to operate on individualroutes. The same applies to smaller buses (mikrobus)and minibuses (mikrolet). The regulation of bus frequenciesand time schedulesis not, however, adequatelycontrolled and is, in practice, largely in the hands of the individualoperators and their bus crews. In Jakarta, regulationis the responsibilityof the local authorityDKI-Jakarta through its Dinas LLAJR. In other cities such regulation is in the hands of provincialbodies, who, like Jakarta, are expected to act in accordance with advice and guidance from the national authority, DirectorateLLAK of the DCLT.

Dinas LLAJR Action Plan

27. In Jakarta, importantobjectives of the Project, in relation to bus transportplanning and regulation,are:

(a) Planning and Development. (i) to establishpublic transportplanning as a part of overall transportplanning; specifically,to introduceoverall network planning with medium and longer-termper- spectives,as well as for short term route development;(ii) to relate the provisionof bus services to existing and potential demand; and (c) to introduce,where and when appropriate,new types of service, includinghigh quality services into the system. - 81 - ANfEh 3 Page 19

(b) Regulationand Control. (i) to license public and privately-owned bus services (for all types of bus operatingon fixed route services)so as to comply with overall planning objectives;(ii) to improve the regulationand control of bus operations (public and private) by introducinga system of route tendering;and (iii) to achieve a tighter control of bus frequencies,bus schedulesand reliabilityof service through the licensing system.

28. In order to achieve the above objectives,Dinas LLAJR, the organ- izationresponsible for bus regulation,would be strengthenedconsiderably by:

(a) buildingupon the re-organizationalready begun in order to embody functions,not previouslyundertaken, and to give increasedpower and ability to carry out other functionsrelevant to the provision of an improved quality of service in public transportoperation. These new and improved capabilitieslie in:

(i) transportplanning;

(ii) public transportplanning;

(iii) survey and analysis;

(iv) bus route and service schedulingand licensing;

(v) monitoringof operations;

(vi) vehicle testing;

(vii) supervisionof terminals;and

(viii) traffic engineering.

(b) Introductionof a program for recruitmentand training of suitable new staff (54 personnelover a 3-year period).

(c) Introductionof a comprehensivestudy of public transportrequire- ments in Jakarta to develop policies,plans and programs for LLAJR.

(d) Implementationof a substantialprogram of traffic management measures,in particular,the introductionof bus priorities,bus lanes, etc. to improve speed and quality of service of buses in relation to private vehicles.

(e) The provisionof technicalassistance from experiencedpersonnel in public transportplanning and operationsand traffic engineering in carrying out the above program (details are given in Annex 5).

Urban TransportPlanning and Bus Regulationat the National Level

29. As the largestIndonesian city, Jakarta is encounteringthe problems of urban transportplanning to a higher degree and on a more extensive scale ANNEX 3 - 82 - Page o0

than other Indonesiancities. It has been helped in respondingto this situation by its status as both province and city, and by its greater resources, whereby it has been able to set up its own organization,namely the Dinas LLAJR, to deal with the problems of public transportplanning and bus regulation. This organization,although it requires both strengtheningand widening of its organizationand activities,is at the forefrontof practicalknowledge and experienceof urban transportplanning, bus regulationand supportive trafficmanagement for bus transportoperations because of the nature and extent of the problems it encountersin Jakarta.

30. Other Indonesiancities have similar problems in transport planning and bus regulation,albeit to a lesser degree. They also have much smaller resources,in terms both of financialand institutionalresources, within their own organizationsto respond to the problems presented to them in this field. They are primarilydependent for advice and guidance on the DGLT, the national authorityresponsible for transportplanning and bus regulaticn amongst a range of related functionsand responsibilities.

Organizationof the National Authority

31. The DGLT has establishedthe Directorateof City Traffic and Trans- portation(LLAK) to be the national authority responsiblefor urban transport planning,traffic and transportsystems development,integration of services, trafficengineering schemes and regulations. The LLAK is a small directorate, however, concentratedin Jakarta without any regional offices, anidlargely with little contact with regional organizationsand their problems. In -racticethere is no direct channel for policies and technicalexpertise developedby LLAK to be made available in terms of advice and guidance in urban transportplanning, let alone in terms of more positive assistance,to the city authoritieswithin the regions, where the major problems of urban transportplanning and bus regulationarise.

32. In response to this situation,the longer establishedDirectorate of Highway Traffic and Transportation(LLAJR) which is a large organizationwith widespreadregional offices, give support to local dinas and cabang organizations in the provincesand cities. As a separate organization,at the same level as LLAK, the LLAJR in practice supplies advice and guidance to regional cities at the local level whereever called for and to deal with the probl ms that in practice arise, whatever their precise nature and scope. In urban areas a preponderanceof these problems inevitablyinvolve the field of urban transportplanning, city bus regulationand traffic management. There is naturally,therefore, a large degree of overlappingwith what are intended to be the responsibilitiesof LLAK and for which LLAK is intended to be the repositoryof the principal expertiseat the national level. This situation insulatesLLAK from direct knowledgeof the problems and experiencesin urban transportplanning across the country. It also gives limited opportunities for any knowledgeand experiencethat has been acquired by LLAK to be passed on to regional organizations. ANNEX 3 Page 21

LLAK Action Plan

33. The objectivesof the LLAK action plan must be to:

(a) strengthenthe knowledge,experience and technicalcapability of LLAK in urban transportplanning, transportsystems developmentand integrationof public transportservices; and

(b) assist DGLT in establishing,by re-organization,by modificationof existing procedures,or by the developmentof specialunits, better avenues of conminicationor an improveddevolution of responsibility, so that LLAK can dischargeits responsibilitiesin an effective manner throughoutIndonesia.

34. In order to achieve the above objectives,the following program would be undertaken:

(a) a delineationof the responsibilitiesof the DGLT in the field of urban transportplanning, transportsystem development,the integration of public transport servicesand trafficmanagement and an assessmentof any strengtheningof LLAK required to fulfill these responsibilitiesmost effectively;

(b) the identificationof any changes in organizationwithin DGLT to enable the duties of LLAK to be most effectivelycarried out;

(c) the preparationof a detailed action plan to implementany changes that are required includingthe developmentof a program of staff recruitmentand training,both within LLAK and to meet the antici- pated national needs for the staffing of urban transport planning organizationsthroughout Indonesia; and

(d) the provisionof technicalassistance from experiencedpersonnel in urban transportplanning and public transportdevelopment, operations and regulationin carrying out the above program (See Annex 5 for details).

Enforcement

35. Effectivenessof traffic engineeringmeasures includingbus priority measures is dependent to a large degree upon enforcementof the traffic regu- lationsand loans. Enforcementis the responsibilityof the National Police, Traffic Division (SATLANTAS). The project would includearrangements for better consultationand coordinationbetween the regulatoryagencies and SATLANTASand for improvementin trainingof SATLANTASofficers in traffic engineeringand accident investigationas well as traffic laws and regulations (see Annex 5 for details). ANNEX 3 - 84 - Table 3

INDONESIA

JABOTABEKURBAN DEVELOPMENT PROJECT

General EfficiencyIndices: DAMRI in Medan, Surabayaand Semarang Compared with PPD in Jakarta and DAMRIin Bandung

DAMRI DAMRI DAMPI DAMRI PPD Medan Surabaya Semarang Bandung Jakarta

Total fleet (in regular use) 73 217 127 194 1,942 Total number of personnel 357 1,044 638 1,054 16,663

Buses operating (averageday in 11/85) Regular buses 31 133 76 138 1,040 Patas buses /a 18 9 7 8 109

Total (Regular+ Patas) 49 142 83 146 1,149

Personnel/busoperating 7.3 7.3 7.6 7.2 14.5 Number of crew staff (driver+ conductor) 191 807 433 800 10,511 Crew/bus operating 3.9 5.7 5.2 5.5 9.1 Number of noncrew staff 166 237 205 254 6,152 Noncrew staff/busoperating 3.4 1.7 2.5 1.7 5.4

Fares/passenger/trip Regular buses (Rp) 125 125 125 100 150 Patas buses (Rp) 200 200 200 200 250

Passengers/bus/day 491 775 654 1,036 611 Passengers/trip 43 58 48 65 52 Passengers/km 2.25 3.26 2.58 5.23 2.71 Passengers/crewiday 128 136 125 189 67 Passengers/personnel/day 69 105 85 144 42

Revenue/trip(Rp) 6,335 5,843 5,303 6,512 7,618 Revenue/km (Rp) 330.3 330.2 284.8 522.4 404.7 Revenue/crew/day(Rp) 18,804 13,784 13,812 18,807 9,927 Revenue/personnel/day(Rp) 10,060 10,655 9,374 14,275 6,262 Revenue/passenger(Rp) 146.78 101.15 110.21 99.70 149.23 Revenue/bus/day(Rp) 74,164 78,337 71,455 103,668 90,814

/a Air conditionedspecial service busee. INDONESIA

JABOTABEKURBAN DEVELOPMENT PROJECT

PPD Action Plan

Objective Task Action by Completion by Monitor

A. Strengthen corporate 1. Implemnt PUUM charter NDF/PPD/DGLT 01/89 Balance sbeet opened 01/89 *tructure and mn- - Appoint accountants to prepare books aU_nt and opening balance for 01/89

2. Assign senior director DOLT 03/88 Appointmnt - Responsible for Implementation of recovery action plan

3. 3 tablish planning function PPD/Consultants 01/89 Vuaction establiaba at subdirector- - Corporate plans ate level - service plans

U. Improve revenue and 1. Revise WAP PPD/Consultants 01/90 Revised VAP operational financial perfor- - Accurate passenger loading survey mnce - Revise VAP fees - Implemnt bonus scheme/incentive measures (including maintenance steff)

2. Devise basic route cost for social and DLLAJR/PPD/ODF/ 03/89 loute costing protocol routes to clarify subsidy LLA*

3. Set revenue targets for depots PPD 01/89 lRven increased

4. Explore revenue collection alternatives PPD/Consultants 01/90 Revised revenue plan adopted - Fares systm

5. Maximize service provision See C and D See C and D See C and D

C. Improve fleet main- 1. Improve maintenance inspection and rec- PPD/Consultants 01/89-01/91 Performace tiproved in 3 depots. tenance and effi- tification procedures improvement costs identified ciency - Install LTI scheme at all depots

2. Set bus engine/overhaul/unit output PPD/Consultants 04/89 Targets identified tarsets and performance standardsfor: - 6 months - 12 months fIEI Objective Task Action by Completion by Monitor

C. (cont'd) 3. Prepare workload plan for central DCLT/PPD/Con- 05/89 onwards Outputs increased by 5X per year; works/depots sultants central garage (Deksi) status and - Implement targets operations defined

4. Establish "spare" vehicle float for PPD/DLLAJR/DGLT 09/68 Spare vehicles available and in ue, routine _intenance and breakdown cover regulations mnded - Aund licensing regulations - Identify vehicles/relicense - Establishdepot procecures

5. DesigDate staff for emrgency/break- PPD Conplete Staff designted procedure working down/running repairs only in progress

6. Tools and equipment program PPD/Consultents 04/89 Order/d livery schedule - Contract doeunts 10/89 - Procure and install

7. Skill training program PPD/Consultants 04/89 Syllabus - Design program 05/89 onwards Number of staff trained - Set up training facility - Implement

8. Future of double-deck;re PPD/MWF/DGLT/ 06/88 Decision DLLAJR

9. Dispose of derelict vebicles PPD/MIOF 12/88 Detes of disposl - Implment

D. Reduction of costs 1. Reduce staffing levels PPD/Ministry of 11W86 Staffing records to achieve - Plan prepared Manpower bus:staff ratio of 1:7 - Implement recomendations

2. Productivity iuproveenc PPD/Consultants 01/89 onwards Monthly returns; dates of chang - Operating staff - Technical staff - Administrative and anagementstaff

3. Review stock control and procurement PPD/Consultants 01/89 onwards Reduction of coots; reduction of policy out-of-stock requieitions; reduction of bus nonavailability; reduction of buses required for service

4. Improve journey times DLLLJR/PPD See DLLAJ - Effect of traffic management program actionm plan 'V.4i;

w. F Objective Task Action by Completion by Monitor

E. Quality of service 1. Revise license conditions to define DLLAJR/Conaul- 01/89 onwards Revised licenses; route planning trips per hour tants criteria agreed - Review principal routes - Implement licensing

2. Limit PPD to routes on which it can DLLAJR/PPD 05/89 onwards Licenses revoked conform to license requirement - Define routes/sections - Revoke appropriate licenses

3. Introduce alternative operations for DLLAJR 05/89 onwards Licensee granted; servlces comme Ex-PPD routes/sections - Identify alternative bids - Implemnt services

4. Comprehensive demnd survey DLLAMR 10/19 Survey completed - Define new routes for open tender 12/89 Survey analysed - Invite/award tenders

5. Terminal arrivals/departures fully DLLAJR/Connul- 09/88 Records recorded and monitozed tants 06/89 Specifications - Develop mechanical/computer logging

6. Introduction of basic time schedules PPD/Consultants 01/90 Production of schedule for city buses

7. Further action on 1982 bus stations DLLAJR/LLAK/ 06/90 Recomendation report Consultants 12/90 Schme complete - Review report - Feasibility study at selected terminals INDONESIA

JABOTAEK URBJANDEVELOFRIENT P8OJECT

DAMRIAction Plan

Objective Task Action by Completion by Monitor

A. Strengthen corporate 1. Implement Perue charter M0F/DAHRI/DGLT 01/89 Balance shet opened 01/89 structure - Appolnt accountants to prepare books and opening balance for 01/89

2. hAsign senior director responsible for DGLT 01/88 Appointment implemntation of action plan

S. Improve revenue and 1. Devise basic route cost for DLLAJR/DAMRI/ 01/89 Route costing financial perfor- social/protocol routes to clarify 1DF maCe subsidy

2. Set revenue targets for depots DAMhI 01/S9 mavemn Increased

3. Explore revenue collection alternativea DAI/Consul- 01/90 evimsd revenm plan adopted - Fares systm tants

4. 2aximdie service provision See C and D See C and D S.e C ae D

C. Improve fleet min- 1. Iuprove maintenance inspection and rec- DAM/Consul- 01/89-01/91 Depot perforeme imroved tennce and eff1- tificatton procedures tants ciency

2. Set bus engine/overhaul/unit output DMI/Consul- C4/89 Targets Identified targets and performance standards for: tant. - 6 months - 12 months

3. Prepar, workload plan for central D&M/Consul- 05/89 omrards Outputs inerease by SI per year works/depots tants

4. Establish "spare" vehicles float for DAMI/DLLAJR 09/88 Spare vehicles available and In um routine maintennce and breakdown cover - And licensing regulations - Identify vehicles/relicense - Zatablish depot procedures

5. Tools and equipmnt program DAMI/Consul- 04/89 Order/delivery schedule - Contract documente tants 10/89 - Procure and install Objective Task Action by Completion by Monitor

C. (cont'd) 6. Skill training program DAMRl/Consul- 04/89 Syllabue - Design program tants 05/89 onwards Imber of staff trained - Set up training facility - Implement

7. future of double-deckers DARI/IMOP/DGLT 06/88 Decision - Decision - Implement

D. Reduction of costs 1. Productivity improvement DAMRI/Con.ul- 01/89 onwards Manthly returns; dates of chean - Operating staff tants - Technical staff - Administrative and managesent staff

2. Review stock control and procurement DAMI/Consul- 01/89 onwards Reduction of costs; reduction of o/c policy tents requiremente; reduction of 1RAs; reduction of basee required for service,

3. Improve journey tims LLAJR/DAMRI 01/89 onwards Measures isplm nted under Loan - Effect of traffic mnagement program 2817-neD, rtgional Citiec Urban Transport Project

E. Quality of service 1. Revise license conditions to define DLLAJR/DAMRI/ 01/89 onwards Revised licenses trips per hour Consultants - Review principal routes - Implement licensing

2. Comprehensive demand survey DLLAJR 10/89 Survey complcted - Define new routes for alternative 12/89 Survey analysed operations 06/90 Routes awarded - Invite/award tenders

3. Terminal arrivals/departures fully DLLAJRor DAMkI 06/88 Records recorded and monitored DLLAJR/DAMRI/ 06/89 Specifications - Develop mechanical/computer logging Consultants

4. Introduction of basic time schedules DAMRI/Consul- 01/90 Production of schedule for city buses tants - 90 - AlI 4

JAIOTAW UhRW DSVSLONUNPROJCT

Decription of Pro ect Physical Comoonents

rldanwovrke Sac- _S-river bridge tio. Leagth P0-flyover Scheme ref. () odwork CA-canal bridle Coments

Primary moadand 11xJor ArterIals fioIt-Dusctt-Lrioar 11 2.30 4-lane saglo c.-y Short-span U5 NoY road follows lina of extsting road; hence (ED complete) *ad 2-lame ervtce now constructton, videning *ad overlsy are all roads on ach side featured III 1.60 2-lase dual c.ways Short-open U (Sme improvemnts recently undertaken)

Pondoxk Finaa-Pajospongn 1 2.80 Dual 6 c.var except 2 short-span aU 1.65 kh of Section I already under constructioa (S onlr) for length between as separate contract I Rbaynran Iaru and Putri it *.70 ) PIju for which dual I FO (Keb.baru) /a Palerabh ro recomnded construction by 1995 I 10r coveys recomended 2 _ll-pxn KS I PO (Put.Nijau)

Paer linggu-D wk I 3 2-lone new/4-lane (D completer 111 widening Existing road follows the Jakarta/Dogor railway II 4 line which It crosses at a ntuber of level IV1 12.7 Low protection - crostsng. Proposed road will be both aidee of V the railway and io Intended to be phased con- VI ttruction (now 1993). i 5.7 T widening to 9m

4 Outer Rina Roc (Nest) I 5.6 Initial Stage earthwork. 2 ehort R Grade separation recommended at inittal st II *.1 for 2-lane dual c.ways 2 R t-31 span for major intersections wtth Airport Toll aoad separated by land for 2 R4 - 31a span and Ierak T1ll Road, grade wep ratlon (if Toll Road. Roads vlll required) at railway will mean 2 FOe. All will function as Arterial require extra ED especially for structures. roads until Toll road is built when they will become frontage roads.

Outer Ring Road (South) la 1.04 Initial Stage - 2-lane -Phasing of conetruction requires Sections It to lb 2.00 dual c.wayo separated 6. die. Aruco VIII to be con pleted and open to traffic before III 2.50 by land for Roll Road. 2 RB - Twin boxe Sections I and IX. Both latter sectione V 0.55 Roads will function as - Include connectionn Into existing or proposed Arterial roads until toll roads Toll road Is built when they will become frontage roads. VI 0.83 1 2-land dual c.way on viI 0.40 aa different alignment RIB- 3 spans at 31. VIII 1.10 1 frou the proposed Toll See coments For proposed junction of ORR(S) with JI.Rsyo road Bogor, the existing river bridge over x.eru CIjentung ti to be widened substantially. Thie IX 2.40 Seem as Sections I to V 2 RS - 13. span will require extra FED.

II 1.10 1 Section. already con- - (Sections VI, VII. VIII are subject to site IV 2.18 structeds work now) Secondor Arterials -- ra^r Pat" Important aissinglink In the secondary road network In North The canal bridges vlll form part of en advance (FS end prelimtnary design) Ja Ilx it.feature is the provision of a flyover approxi- contract (LCB) to include demolition * rvices mately I km In length to *ccomodete a dual 2-lane c.way. The relocotion, construction of canal bridge. schema Includes canal bridge*. junction Improvement and road retaoinng walls and ground-level works. Thle improvemnts at grade. For the existing canal system. high-water would provide the main contractor (ICE) vith a levels have been established by DPU-DKI to match the requiremnts clear site at the west end of the schme and of a future flood protoction Scheme. Any proposed canal bridges proper access to working areas. oust provide adequate clearance to thiS VL. This results In fututc ro d levels approxiuately 1.6x above those existing, which affec,s ground-level end elevated works.

Sudiresn-JatinAgra 2.64 New road 4 short-Span RI This schem ie slated to the Minangkubeu F0 3.25 Major road 1 9m frontage road. I major RI (Ciliwung) Scheme. which - the recommended component of 0.11 Ninor road ) Improvment I FO (Sudirman) the original Pejoepongan-Natrrxn scheme.

Dll D vloment Roads -a1t wing a 1.60 2-len. dual c.ways I CB widening (FED complete) (2.37 km) and 3-lane I Cb and demolish dual covey on existing existing D 4.00 Due 3-lane 3 1.39 3-lone duel c.way on extsting alignment F 0.50 3-lane duel cwv new link H 1.26 Pavemant strengthening East uSng CC/Fl 3 20 New dual 2-Iane 3 RU (PS coplete) Eg 1.60 Nev dual 3-lane CC 5.40 Dual 2-lane/3-lan-

.a TShi my be affected by Rebayoran Lms schem. Stem (he) A4x Description

I72 enowlte) J. Itldpamt W1 - --_t~ toeavi d the t problm eJ tio (Jl. gym lkvk/Jl. Nsjowebttl and a lobgo structure ltinkig Ji. Iaym srguk/Jl. GCsh No" to JI. Ubrdeka crat. The reco_mmed schw is for a 2-las. dual c.may flyover approximtely 470u eog i.celudiag approach rao". toether with groundilevel j emtiom improvement.

Seo_ flyover Ji. Pager so*m/Jl. Er_mt smder/ Three sebhwa hev bsen coeidered. uea ebcoamating otf (Fs complete) J1. r_t ay&/J. Brunt Switasg 3-las. deal c.. y flyover. The recom_ded schema ti for a flyover to eccoodate fl-S mowyints - total length apprombuately525. lacludiva approach roe. Grouad-level Improvements to all major june- tios is Included. Mvsu*abuu Flyover flw lk between Jl. tingkabou sad Th total lesgth of the link rod to approxlmtly Miu. The (PS complete) J1. Dipomeoro to rolls congas- total length of the flyover would be approximtely 460u tion is lasr _amputar*e Including raps. It would acomodate the 2-la- duel c.way c*d it would cross the Hanggerai-Tanah Abang railway ed the proposed FPjo"pougan-)trma road. At the southern end, the flyover '-uld ltink Into the existing road netvork vie a mew riv,.r bridge over KeliHltonb (span Xs) where the proposed road is 3-lane dual c.may. Prouka Flyover J1. IMtrts Dxi_/Jl. Sal_ba laye/ Three schema have been consid*red - 2-lane dgal c.wey cape- (Prs-FS complete) J. N8tr1MRnMaYa/JI. iraukg city flyovers in either N-S or *-1 direction cnd a one-way 3-lna capacity flyover to take treffic from 8-N. The letter acbes is recommended for consideratin,. to full FS atage. Traffic ;neaont Due Prority Iassurs ounung Saharl-Jatinegra 9.33 The schemes comprise dinor road widening. nstallation and modificatton of traffic and junction Improvements, traffic signals, a footbridge, signing and the marking out of the speatil bus-priority lanes. (FED complete) J1. Cya Tapn-Jl. hnsyis Ashart 3.58 A pubitcity campaign will be mounted by Dt writh assietanc- ) from consultonte

n1. ITraat Bundor-Jl. Suprapto 4 ) Tuga Tani 0.50 Thie schem comprises minor road widening, signal changes, signs and road mrkings to improve traffic circulation at thie busy junction *outheat of Nerdeka Square. Ji. Rasuna Sald-Jl. Diponegoro 0.50 Thie scheme comprises minor road widening ond Improved traffic signl staging at a major junction of a gecondary arterial road. Jl. lekandar Dinata-Jl. Dewi 10.00 A 10 km corridor improvemnt cheme has been identifted from Sertika-JI. Raya No.lor Jatinogara towards logor following the route of 31. iekandtr Dinsta, 31. Dewl Sartika sad i1. Ray* Bogor. Improvemente will be required to junctions, signs. footways, markings and bettor facilities at signals for to-turning vehicles. Taush Abang Traffic xagam_nt (riD complete) The schem will comprise nm road construction, road widening Sch&a and junction improvemnte including *igtl changes . signis and road mrkinlSe to improve traffic circulation In tho arca. As part of the nsw link road construction, two new mall epan bridgee are required and to Increase pedestrian facilitias. two naw footbridges are propoeed over the river either side of the exitting road bridge carrying J1. Kebon Rlati. rAbeyoran Low levliw of earlier traffic managementschea and revision in the lght of Increase frequency of railway-level croailng closures. OLLAJR 31 program A general program of traffie engineering work including arca and corridor schemes (Involving 55 strxts)n isolated intersections, ba-priority mocures (77 km of roadway), traffic signl installations, and po sibly control system. pedeatrian improvements*trsct signing and road marking. This will be carried out by the DtLJA with the help of the GPOand a technical aontstance program. Road bAbilitation end hitntenance DPOProgrm A four-yer progrm during M8-93 of contract work carried out In conjunction with a technical as*iotance program inolving the application of improvd mthods of assess_nt and mnagemnt of road matntenance require- mnte. - 92- ANNE-5 Page i

INDONESIA

JABOTABEKURBAN DEVELOPMENTPROJECT

Sumary of Training and Technical Assistance

1. The project includes an extensiveprogram of training and technical assistancefor institutionaldevelopment in urban infrastructureexpenditure program-ingand local government revenue generation,transportation and trafficregulation and operations,transport planning, traffic management, and air pollutionmonitoring, as well as highway engineeringdesign and supervision services. Followingare summariesof the training component(Part A below) and individualtechnical assistance requirements for project implementation(Part B) and institutionaldevelopment (Part C). An overall sumary and implementationtimetable is shown in the attached Table 2.

A. Training Summary

Training Objectives

2. One of the principalbottlenecks in infraatructuredevelopment in Indonesiais the limited professionaland technicalcapabilities of government agenciesand the city authorities. The proposed projectwill attempt to relieve this situationby improvingcoordination, and strengtheningthe agencies responsiblefor the planning,management and operationsof the urban transportsector. These objectives will be achieved throughproviding technical assistancefor the developmentand expansion of in-countrytraining establishmentsas well as on-the-job training during individualadvisory assignments. Selected staff will also be sent for overseas training. More than half of these will be trainers who will assist, on their return, in the expansionand developmentof the existing training establishments. The three trainingprograms to benefit under the project are describedbelow. Details of the costs, impacts and monitoring indicatorsare provided in Table 1.

DirectorateGeneral of Land Transport, Bekasi Training Center and College

3. In 1980, the Ministry of Communications'Land TransportTraining Center was establishedincluding the Road Transportationand Traffic College, now locatedat Bekasi, in the Jabotabekarea. The main functionof the College is to train senior technicianstaff for the road transport sector of the DirectorateGeneral. of Lar-dTransport. The College runs a 3-year full- time vocationaltraining course with a capacity of 40 studentsper year. The courses include traffic engineering,transport planning and public transport operations. The College together with the Land TransportTraining Center is also capable of running short courses. At present a 2-week course is held four times a year and a 3-month course for middle management is taught at the Land TransportTraining Instituteat Tegal. The Bank has been supporting the developmentof the College since 1983, during which a new curriculumhas been introduced,and the short courses have been added. - 93 - ANNEX S Page 2

4. The proposed loan would be used to continue the developmentof the College through 1988 and 1990 by: (a) providing technicalassistance to expand the full-timecourse to 4 years; establisha short (3-month)course in trafficengineering, transport planning, and public transportregulation and planning,for local governmentstaff; and establish in-servicetraining courses in public transportoperations and managementfor bus company staff; (b) expandingthe campus to double the existing college throughputon the 3-year course;and (c) providingtraining equipmentand facilities. Details are summarized in Attachment 1.

5. Planning and implementationof the campus expansionand the physical works would take place in 1988/89, allowing completion in time to expand the student intake in 1990. The fourth year extensionof the full-timecourse, and the short-termtraining for local governmentstaff would be implementedin 1989 and the short in-servicecourses for bus company staff would be implemented in 1990. A further eight staff from DGLT would be sent for overseas Master of Science courses, four each in 1988 and 1989. Most of these would return to assist in the developmentand expansionof the College; others would be assignedto various posts in DGLT. One of the immediatebeneficiaries of the short course would be the Dinas LLA.i of Jakarta although the course would also be open co other local government establishments.

NationalTraffic Police (SATALANTAS)Training College

6. The National Traffic Police Training College is located in a new building at Serpong, within the Jabotabekarea. The College provides: (a) basic in-servicetraining covering traffic duties, laws and procedures; and (b) higher level courses on specializedsubjects such as traffic engineeringand accident investigation. Both cstegoriesof courses are held three times per year, involvinga total of 300 students. There are currently 12,000 traffic police in Indonesiaof which 6,000 have received basic traffic training. Of these 6,000, only 2,000 are left--theremainder have either left the service,or retired. The major challengenow facing the College is to increase its throughput,expand the higher level courses, and improve the scope of teaching. It is estimatedthat the existing College facilitieshave the capacity to accommodate600 students per year.

7. The proposed loan would assist the College to reach its objectiveby providingtechnical assistance to: (a) train about 40 existing College trainers;(b) develop new curriculafor the basic and higher level courses; and (c) implementthese new courses. Provisionwould also be made for overseas trainingof five trainers,and the purchase of teaching aids. The technicalassistance contract would also provide advisory services for the Jakarta TrafficPolice for improvingenforcement procedures, particularly with regard to public transportpriority measures and road safety. The proposed technicalassistance program is summarizedin Attachment 1.

Ministryof Pubic Works Regional Training Centers

8. Under the Regional Cities Urban Transport Project (Loan 2817-IND) the Urban Roads Directorateof Bina Marga will set up short-termtraining courses in four of the Ministry of Works Regional Training Centers including - 94 - AN= 5 Page 3

Jakarta. These courees will provide training for senior, middle, and junior manage ent, as well as techniciansfrom the local governmentoffices in Bandung,Hedan, Semarang and Surabaya. These courses will cover traffic and highway planning,road maintenance,and use of computers,mainly focusingon the technicianand junior managementlevel.

9. An additionalfour man-monthsof technicalassistance has been includedin the proposed JabotabekUrban DevelopmentProject so that these courses can be ade availableto the DKI Jakarta and Botabek staff. These additionalresources will be used to provide trainersand materials for the courses and to supervise,monitor and evaluate the course impacts. Further details of this program are includedin the Staff Appraisal Report for the RegionalCities UT Project (Loan 2817-IND).

Table 1: JABOTABEKURBAN DEVELOPHENT PROJECT - TRAINING PROGRAM

Training Training Students Throughput Man /a Cost Agency Center Ezisting Proposed Exis. Prop. Components months Rp bln.

DCLT Bekasi DCLT DCLT 40 100 Technicalassistance 138:4.4 5.1 Local gov't Overseas training 0.5 Public trans. Teaching aids & equip /b 0.3 operators Campus expansion /c 0.4

6.3

SATLANTASSerpong National National 300 600 Technical Assistance /d 24:48 0.7 Police Police Overseas Training 0.13 Teaching Aids and Equip. /e 0.2

1.1

DGBM Jakarta Regional Jakarta and Add'tnl TechnicalAssistance 6:15 0.20 Public Cities Botabek staff courses Works staff

/a Approximateforeign:local consultants man months required. 7T Laboratory equipment, vehicle workshop,field survey equipment,traffic counters,speed meter. /c Includes extension to dormitories and classrooms. 7i Includes approximately 6 man months for technical assistanceto Jakarta traffic police. 7e Includes approximately Rp 140 million for equipment to Jakarta traffic police to be determined during stage 3. Itsa 2 - ra.lezA AUnSA A TRAISIl 4IMi Smhs...... Suis- hrnpm_siho t atlmt.dM lprs IProw-. Ieop ets, ; lurato IOWA Devlw ;m_ im Om"tt ; ppaftmta lip Fore. I c s 6600s mB. fIftihu COMee_Rlt_n s.wy/ cwt/s annm_ mnt t-u TO I bid! I lesitn. bidu/prp tedMoc. rwiw na.m centr ' _ Mmv ~.bat Cap mInn) Foreig Lcal lb dms. 115m 1 intuit. (anItteL) I I_ ~~~~~~~~~~~~...... _..... Tralinfr

Al SILT SM trainift projct exten: SIT DIP 6.251 / e D 01/15 2/11 2/U 2/U S3/1 41 1 4M S/ 6/Q 7TM Wu S/ Talins 5,15 In 414 IslleohAps 491 lyiput ml I LO CtP fIen 562

*2 SKi trofning SUIT aimrt cuKeill DIP 2Q5 6 15 DA 5JS01 6/SB 7M1 7/U /S 9/US 9/U Ism1 1/ 12/* 1/U tIS A3 SATLUTAStraini d DM DIP 706 24 40 Da 0S/ S/IS 7/U 7/U SS 9/U 0/U 10/U Il/U 12/ I/U t i/ 9d_pnt 36 IO 0toteal 7,527 1a 46 TodgnicsttAsisturs

gf¶fwsri nd.etrctwti,n swn: 1"1.94 ...... 01 Sfl _W~ proj cosrd a*l o 1OSKI (KA) ,405 40 120 e2 Contguitiin sselwiion A 1.45 40 120 r0A 01S/ 2M 2am5 _S S/U 4/ 5 m KSI isne P mru_ I: S41(11.0 U3 r/c ntruction worvm e , 724 235 7t5 O 54 toad aIsntas 446 12 36 0C 55U VS 7/AS 7/U /U 9/U 9/U lam Ilm 1MIN 1/U 1/ 05 OM FE/cotnrtlrcon mom wisim. D DIP 7,051 1" 570 CP 01/U 2S 2/US 2/M 3/S 1.* 1/U 5/U 6M 6I AM VA/ In tituti..l dst I nc: 12.011 el Jabetab iUIDP amo DIP 114 30 e A 01/m 2M 2/ …… --4 /S US 41/S 5A2 mm SKI SIe LLAct Rat ist_1 : SIT DIP C2 prt nmt_kst ptlino 2,73 75 225 CS liMit tr_- it reguation "a 18 514 MOO)* 01/U 3/U SIN 3/U8 1M 5/S 5/m 6/IS vo 7/U ll 5511 64 Paring potlicy S Is 5 1 Cs Traffc _nugm,t 1&9 35 165 1 Cl 01/U 3/55 3/U S/U 4/U 5/U 5/M 6/0 6/I r / B/l 01/I e6 W1I S1m Plpn_ an riMes KI (MA) 520 14 42 01/U S/U 3/U11 3/U 4/U 5/1 5/U /M 4/U 7AIS am mm Iporosnet advim SIT: IT Dip t7 UlASI t p truprt asist. 64 Is 51 Cl U/IS /M 7/U 7/U Bs 9/ 1 0/U 11/U 2U 11/ amUP CB PtO Wars u1 aplm t/d 2,50 t 455 35 1 BMW advisers, od Ofpmot eV 15 a ) tr0/ /I /m 2/ S/UAB 41/U1. 4/U S/U AM 7/U t/I SI/U 9t LUIIJ Air potlutian _n1toring IT SIP 111 5 9 O7 U/Il Od Wd_WO SOD ICI tut. proe ct prp tifn:ps 6,0

1 Proect A - Hs trit S 2 e 5e 150 t I 6/U G 7/U SI 9U 9/U 1m 1/U U 1/U Il/t * 02 PrOecwt* - IftrWLot'eo city f/ 507/ DIP 1,0 is 00 07 es/U AM 7/U 7/U 8/ 9/U 9/m 10U li/U 1gm lip 1/UP 03 Projsct C - Kouml.m P1/ISSIK NM0SIP 1,0 is US 07 05/U 6/IS 7/U11 7/U S/I 9/U 9/U 10/U li/U lam1 I/U 0l/U *obteal 37.227 IM 2,914 ...... ------......

Total 4,754 1,156 3,30 |

a 1t of o (tif had nnotl_nt distribhim of ftoJ gvlftet a n Ir to bc rwcaed In tms of fi l U)t l1 /b SIA drect pointsnt. CP - copetfit ph_Ors: * - led cnrat; Pt Pp llflcatimn rulred Ic Allowane fwr futt eat FS/90.1. SILT wItt s1at sitarnetlts fmi fr F ISr In rde toeinmc early am bOttr ns continuity. If o r fwdi tfnmd lstcr_tHnt I bn re t d for ther troanheg paposa. Id HtintBm. e t.t bon wd mbimn tasts, sns (1. l. tl *fr 99 *rd 1 - IO *a LU MraZant) /O MV1ins 1d u.lvticsl sGulpo.t .1d ietitmes. l*uacorty alippias. - 95 - AUM 5 AttacheentI Page 1 INDONESIA

JABOTABUKURBAN DEVELOPMENTPROJECT

Training and TechnicalAssistance - Outline rerms of Reference

A. Training

Al. DGLT Road Traffic and TransportationCollege (RTTC)

ExecutingAgency: DirectorateGeneral of Land Transport (DOLT)

Objectives: Consolidationand extensionof RTTC training program and facilitiesincluding: (a) consolidationof existing three- year diploma course; (b) establishmentof four-yeardegree course; (c) provisionof in-servicetraining courses for local governmentstaff; (d) establishmentof public transport operationsand managementcourses; (e) continuationof M.Sc. scholarshipprogram; (f) expand the campus to double the existing college throughputon the three-yearcourse; and (g) provide training equipmentand facilities.

Costs Man-months Cost Foreign Local (Rp million)

Trainers and course expenses 138 414 5,123 Fellowships 494 Equipment 272 Campus expansion 362

Total 138 414 6,251

A2. DKI-JakartaTraining

ExecutingAgency: DirectorateGeneral Bina Marga (DGBM)

Objectives: Provide short-termtraining courses for senior, middle, and junior managementas well as techniciansfrom local government offices in traffic and highway planning,road maintenanceand use of computers (based on program developedunder Loan 2817- IND, Regional Cities Urban Transport Project).

Costs Man-months Cost Foreign Local (Rp million)

6 15 205

Total 6 15 205 - 96 - AM!=L5 Attachment 1 Page 2

A3. SATLANTASTraining and Equipm_nt

ExecutingAgency: DGBM

Objectives: (a) Training about 40 existing college trainers; (b) develop new curriculafor basic and higher level courses; (c) implement the new courses; (d) provisionof training aids and equipment.

Costs Man-months Cost Foreign Local (Rp million)

Training 24 40 706 Equipment 364

Total 24 40 1,170

B. Project Implementation

B3. DKI-JakartaProject CoordinationAdvisers

ExecutingAgency: DKI-JakartaBAPPEDA

Objectives: To assist the JabotabekUrban DevelopmentProject Coordination Office (JUPCO) in the areas of: accountingand financial control; project planning, (engineering,transport, and institutionaldevelopment), adiinistration and monitoring (includingland acquisitionand resettlement)(Assignment combined with B2 below).

Costs Man-months Cost Foreign Local (fRpmillion)

40 120 1,485

Total 40 120 1,485

B2. ConstructionSupervision (A)

ExecutingAgency: DKI-JakartaBAPPEDA

Objectives: To assist in the supervisionof the constructionof civil engineeringworks of Pasar Pagi Viaduct. - 97- Attachment-M 1 Page 3 Costs Nan-months Cost Foreign Local (Rp million)

40 120 1,485 Total 40 120 1,485

DKI Dinas PU Assistance

B3. Final EngineeringDesign and Constructionand Supervision(B)

ExecutingAgency: DKI

Objectives: To assist in the final engineeringdesign and supervisionof constructionof civil works (severalcontracts).

Costs Man-months Cost Foreign Local (Rpmillion)

235 705 8,724

Total 235 705 8,724

B4. Road Maintenance

ExecutingAgency: DKI-Jakarta

Objectives: To improve road maintenancemanagement, prepare a road maintenanceand rehabilitationprogrsim and to assist Dinas PU to carry out these works. To review policies,regulations, and proceduresfor adoption of privately-fundedinfrastructure.

Costs Man-months Cost Foreign Local (Rp million)

12 36 446

Total 12 36 446

B5. DGBM/FED ConstructionSupervision

ExecutingAgency: DGBM

Objectives: (a) To assist the relevant offices of Bina Marga and to ensure constructionwork is carried out in accordancewith the engineeringdesign and contract documents.

(b) To prepare the final EgineeringDesign and review future projects under the directionof Bina Marga's Regional BettermentOffice IX. ANNEX5 - 98 - Attach ent 1 Page 4

Costs Man-months Cost Foreign Local (Rp million)

190 570 7,054

Total 190 570 7,054

C. InstitutionalDevelopment

Cl. Jabotabek IUIDP Advisers

Executing Agency: DG BANGDA

Objectives: To assist Jabotabek regional governments in the preparation of capital expenditureprograms for Repelita V and of individual annual expenditureprograms within the frameworkof the IUIDP InstitutionalDevelopment Action Plan.

Costs Man-months Cost Foreign Local (Rp million)

30 90 1,114

Totel 30 90 1,114

C2 TransportNetwork Plmaning Regulation

Executing Agency: DGLT

Objectives: To develop an integratedurban transportdevelopment plan and related action plans for each transportmode concerned,for Jabotabekfor the period up to 2005, review existing and future demand based on urban public transportin Jakarta and devise new route and service plans and schedules

Costs Ma'-r"months Cost Foreign Local (Rp million)

75 225 2,784

Total 75 225 2,784 AM=I 5 - 99 - Attach ut 1

C3 Public Traasort Emlatiou

!szcutio&hcza DCLT Objectives: To assist in the review of regulstion of licensed services and to detevaim actual s"rvice requiremmats. (Study to be carried out in coajunctionwith C2).

Costs u-wmstbs Cost foreign Local (Rp million) 18 54 668

Total 18 54 668

C4. Parking Poli Executing A4enc: DOLT Objectives: Reviewstret car parking and prepare proposals to improve traffic flow; review rev_uo collection and enforcement procedures nd prepar proposals to increase city revenue from such cbanges. (Study to be carriod out in conjunction with C5).

Costs Ken-months Cost Foreign Local (Rp million) 16 54 668 Total 18 54 668

CS. Traffic Monagemeat

Executins Asgecy: DOLT Objectives: To assistDias. LLAJRwith further detvlopunt of its five-year progremin traffic managemnt and buv priorities.

Costs Man-moths Cost Foreign Local (Rp million)

35 105 1,299 Total 35 105 1,299 ANMUX5 - 100 - Attachmeot1 Page 6 C6. DKI Revenue Ilurovea nt and Financial Management

Executing A4ency: DKI

Objectives: (a) Preparationand assistancein implementationof Direct and PBS revenue ImprovementActions Plan.; (b) assistancein preparationof RepelitaV IUIDP ExpenditureProgram for DKI Jakarta; (c) review of DKI financialmanagement policies and rrangements.

Costs Man-months Cost Foreign Local (Rp million)

14 424 520

Total 14 424 520

C7. LLAR National Public Transport

EzecutingAgency: DMTI

Objectivess To assist and upgrade the capabilitiesof DGLT (LLUAR)staff in the detailed formulation,development and implementationof urban public transportpolicy. Costs Man-months Cost Foreign Local (Rp million)

18 54 668

Total 18 54 668

C8. PPD/DAMRIBus Managementand Operations Improvement

ExecutingAgency: DGLT

Obiectives: To support the management team of PPD and DAMRI in the implementationof action plans to improve the management,operation and provisionof public transportbus systems in Jakarta and regional cities.

Costs Man-months Cost Foreign Local (Rp million)

PPD 45 135 2,500 Dawi 15 45 900

Total 60 180 3,400 -101 - AS= 5 AttachmentI

C9. LLAJR Air PollutionMonitoring and Equipment

Executinc Agency: DCLT

Objectives: To improveair quality monitoringand analysis in DKl-Jakarta and help develop national vehicleemission control strategy.

Costs Man-months Cost Foreign Local (Ip milllon)

3 9 111 Equipment 800

Total 3 9 911

D. Future Project Preparation

Dl. Mass Transit FeasibilityStudy

ExecutingAgency: DGBM/DCLT

Objectives: To be determinedby assignmentC2.

Costs Man-months Cost Foreign Local (Rp million)

50 150 2,000

Total 50 150 2,000

D2. Medium/LargeCit-r

ExecutingAgency: DGCR

Objectives: Contiliuationof project preparationinitiated under Loan 1972- IND (Urban IV).

Costs Man-months Cost Foreign Local (Rp million)

75 200 3,000

,.o0tal 75 200 3,000 i- 102 - inAttac!mt 1

D3. Kes"oran Site Dewelopent

Ezecuting Agencyl DOCK

Objectives: (a) determine appropriate arruooito and coscepto for developaot of former Kimyoram airport site, and 'b) prepare feasibility studio and bid doe_m ets for lot pbase of infrastructure deoelopm_t.

Costs n me th Cost Forign Local Ot 1illio)

75 200 1,000

Total 75 200 1,000 - 103 - INDONESIA ANNEX6

JAJOTABEKURB1AN DEVELOPMENT PROJECT Page 1

1114. I -SWItUY OF PROJECTCI13 (UtpofIllion)

LUd ...... Wrk, ~aipeetud teas. easiatanee....--- Total .. comooent ApaWy (not) lose Cmntirsp iuuIb Net Tax Total /a coat Pkpsical Price tat /c WEITA Cost II toed and intersectioncomtmuction: 33,63 131,079 9.331 14,075 154,9616 6,974 161,962 195,598 52.91 majorarteril tods 9,400 31,736 2,3W 2,645 36,761 114M -33,415 45,015 13.01 OuterRirg Read Weet I 5,500 16,925 1,249 1,333 It.=2 879 20,406 2S.96 7.01 Outer RtinsReed Souths B 4,100 14,511 1,111 1,311 17,23 71 18,00 22,109 6.011 lecondary arterial reeds: 20,417 72,231 5,417 7,443 45M9 3,819 8,911 109,338 29.61 9uncit-Lfngker I 20 4,04 35 116 4,412 202 4,484 4,954 1.31 Pinving.Pejapponge a 650 16,112 1,206 1,921 19,269 866 20,115 20,74 5."1 Nfnugu-Dopok I 460 6,500 41s 320 7,506 329 ?d41 8,296 2.25 PnearPaul 0 1,920 16,351 1,226 1,180 16,757 864 19,601 21,521 5.1 TedsUSJatin.raW-SUdirMn 0 9,537 15,365 1,152 1,73 16,26 822 19,077 21,614 7.71 Tebus P&JosponSan-11stramon 0 7,400 13,841 1,036 2,161 17,860 767 17,807 25,207 6.12 Najar intereectiwa: 3,613 27,112 2,033 3,9910 33,135 1,491 34,46M 36.239 10.35

Haruaf fltyover I 626 7,175 536 672 8.385 377 8,74 9,389 2.51 Samesflyove 0 1,495 7,520 564 1,251 9.335 420 9,755 11.250 3.01 NiningkebaufLyover 0 0 6,643 496 1,105 8,247 371 8,618 8,618 2.31 Pramuka-Mtrimn ftyover 0 1,492 5,774 433 9%1 7,146 323 7,490 8,96 2.41 GuidedLand Geoveopaent: 14,992 39,759 2,962 5,060 47,801 2,151 49,952 64,944 17."5 EasternAreon: 9,151 15,93 1,195 2,272 19,400 67 20,273 29,454 8.01 RwoutCU/FF 0 7,861 353 26 49 ,86 174 4,042 11,922 3.25 RouteII 0 1,300 2,286 171 289 2,747 124 2,670 4,170 1. 11 Jatinegara-Routecc cosmection 0 0 10,494 787 1,504 12,78 575 13,361 13,361 3.61 WeasternArom: 0 14,426 1,062 1,676 17,151 77 17,958 17,958 4.95 RouteI 0 0 2,738 20 10 3,066 13 3,153 3,183 0.91 Route0 0 0 10,224 767 1,446 12,457 561 13,017 13,017 3.51 Routea 0 0832 62 61 956 43 999 999 0.31 Rout P 0 0 521 39 38 59S 27 625 625 0.25 RouteRN 0 0 III a a 127 6 133 133 .01 KemmyorenSite U 5,811 9,400 70 1,112 11,217 S0S ¶1,721 17,53 4.71L

TraffficManagemment: 2,9681 40,841 3,066 3,824 47,752 2,149 49,901 92,09 14.31 Area/corridorImprovement: 2,9681 5,123 384 304 5,811 242 6,073 9,061 2.51 Kebsrornkm /a Die 544 844 43 62 969 44 1,013 1,557 0.41 TendshAbens I D 1,892 2,091 15? 54 2,.M 104 2,405 4,297 1.25 TuguTani 0 0 421 32 31 484 22 50 SOS 0.11 ResumeSaid-Diponcomrz a 0 166 12 7 185 8 194 19 0.11 basilSsrtika.Kr.J*ti-RAyo Pager 0 552 1,601 120 ISO 1,871 84 1.955 2,507 0.71 Sua priorityaaaweao: 0 5.k40 39 144 5,777 240 6,037 6,037 1.61 GenungSari-Jatinagara 0 0 2,3 25 78 3,1 136t3,1533,13 0.9 KyalTopa-Nasyls Aa)lsari 0 0 370 28 6 403 1a 421 421 0.11 Kromt lunder-Su.prepto 0 0 2,136 160 61 2,357 106 2,443 2,443 0.71 OfneeLLAJR program: 0 30,500 2,28 3,376 36,163 1.627 37.791 37,791 10.25 Trafficsigmals 0 0 5,0 37 40 5,6 0 606 606 1.6 Intersection iqprovammnts 0 0 9,600 72 1,120 11,440 $15 11,955 11,955 3.256 Pedestrienisprovemmnts a 0 4,000 300 467 4,767 214 4,961 4,9611 1.31 Signing wd morking 0 0 1,900 143 222 2,264 102 2,346 2,366 0.61 1w priority progree 0 0 10,000 750 1,167 11,917 536 12,453 12,453 3.41 RehiebiLItation wW Naintenanes: 0 5,500 413 642 6,554 29 6,849 6,849 1.9 PrlwryroIdI 0 0 0 0 0 0 0 0.05 Secondaryend local roads 0 0 5,500 413 642 6,554 29 6,849 6,849 1.91 Sub-total civil woerksend eefpnt 51,610 217,201 16,290 23,604 257,09 11,569 268,664 320,274 86.71 ...... - 104 - Ane 6 INDONESIA Table 1

JABOTABEKURBAN DEVELOPNMUT PROJECT Page 2

TOMS1 - MM OFPSOECT C1T$ (lp sittim) ._...... _...... _...... _...... _...... __.. L ------. Verks, q*p_t tech. asiste. ------. ---- Totai cam t Agency (nst) se" Cantingancesb Mt Tax Totat /a cast Phyical Price cost /e E & TA Cost X ...... ___......

Tdnicat Assist : 0 37,226 0 0 37.226 3,723 40,99 40,949 1t.1X ...... ----- ...... _...... _...... _...... _.... To Jotask IUIDP assistance N 1,114 1,114 111 1,225 1,225 0.31

To Ki-Jakart.: 0 21,079 0 0 21,079 2,108 23.107 23.187 6.3% .. _...... ------...... ------...... _...... _ ...... EAPPIDAm stwnc: Project coodinatf n D 1,425 1,40 149 1,634 1,434 0.4% Future projewt preparatfon D/C 3,000 3,000 300 3,300 3,300 0.9X Dbir Pe,kpton reue iep 0 5D20 520 52 s72 s72 0.2% Dils LLAA assistance: Trport netwok pluming L 2.7, 2.74 278 3,062 3,062 0.81 Public trport reulatfon L "6 "4 67 73 m 0.2% Parking policy L 668 68 67 735 7 0.2% Traffic *.rbsont L 1,299 1.299 130 1,429 1,429 0.4% Dins PU msistance: FED/construction aupevision D 10,209 10,209 1,021 11,230 11,230 3.0% Poad mint nanc 0 446 446 45 491 491 0.1%

To DC Bino rge: a 0 7,054 0 0 7,054 705 7,759 7,759 2.1% _ ..------...... FED/lonstructior supervision 7,054 7,054 705 7,759 7,759 2.1%

To DC Ld Trnport: L 0 4,97° 0 0 4,979 496 5,477 5,477 1.5% ...... _...... ; ...... ------...... Nat. public tranrport sssfetnce 6L 666 67 735 ns 0.2% PPD asistance 2,500 2,500 250 2,750 2,750 0.7% DCARI asistance 900 900 90 990 990 0.3% LLAJR aIr pollution monitoring 911 911 91 1,002 1,002 0.3%

To DO Cipto Xarys future projects C 3,CW0 3,000 300 3,300 3,300 0.91

Training 0 7,526 0 0 7,526 753 8,279 6,279 2.2X ...... ,...... DCLT RTTC training nd *qu _pnt L 6,251 6,251 625 6,676 6,876 1.9X SATLANTAStraining a 1,070 1,070 107 1,177 1,177 0.3% OK1 training (RC'T) 0 205 205 21 226 226 0.1%

Total project cost 51,610 261,953 16,290 23,604 301,647 16,044 317,691 369,501 100.0% ,,,,,,.,.,,,,...... , ...... ------...... ------......

/a Legna: I - DO Olne Morge 0 - KI-Jakarto L - DO Lad Trnaport N - NUA, DO SCngde U - Unallocated puidins outce of Kmsyoran site dewtlopmnt study /b Physcal contingeny allowane s 7.51 /c Taoe appled to locl costsonly 10.0% 90.0%- goods /d Esti0ted forolgn exchane ndo S5.0% - eivil works /o Costs shared: MI - land; DM - remainder - 105 - INDONESIA Annex 6 Table 2 JABOTABEK URBAN DEVELOPMENTPROJECT Page 1

...... WATA Expwitue flow (S pwr D0I T) Ce"nant Agency /a W"S 6190 9091 1/ 9293M 94 lord rnd ...... intersction Constnuetion: ...... Major rteial road:

Ouwtr ing Road Most a 16.0X 2W.5 20.0 20.5X 1S.05 utew ling lod South I 15.05 15.5X 23.5X 24.0 23.

Secardry artrial roas:

Buncit-LiueWr * 50.OX O.0X PinenwPJejmnp i n 10.01 25.m 25.05 25.5 15.05 minu-Dpoek 20.05 40.5X 40.05 0.5 0.05O 0.5X Pesar Pau9 D 15.05 15.5X 40.05 30.05 0.05 T*us Jatinegars-Sudirwan D 0.5X 10.05 20.05 35.01 35.OX TebAu PeJomng n-Natr_mn D 0.5X 0.OX 10.0X 20.0X 30.O5 40.0X

Major intersections:

Narmni flyover 50. 50.0X 0.OX 0.OX Seim ftyover D O.OX 1.0% 4U.OX 40.0 Niningkabau flyoesr D .OX 15.05 45.01 40.01 Pramuke-atr_mn ftlyovr D O.OX 1S.OX 45.05 40.05

Guided LeD Devtont: ...... Eastem Ares:

loute CC/FF D 0.5 10.01 20.5X 40.05 30.05 RoutEE D 0.5 20.0X 30.05 50.X Jstinegare-Route CC comenction D 15.0 15.0 55.0 15.0X

4esterm Areas:

loute S D 40.01 40.01 20.0X lout* D D O.OX 0.5 10.0 30.01 40.0 20.01 loute E D 0.5 100.05 Route f D 0.5O 100.5O Route N 0 0.5 100.05

em_yworn Site U 0.5 20. 50.X 30.OX5 0.

Traffic Maneglent: ...... Area/corridwr Ifprovamn t:

Ksbayoran Lm_ /* D/2 100.05 0.5X Tenh Abun I D 60.5X 40.05 0.0 tugu Tani D00.5 100.0X Rlam Said-Diponogro D 100.05 D ud Sartika-Kr.Jati-Iaya Bogor D 0.5 50.X 50.X

s priority moures:

CumxV Seri-Jatlnegare D 50.05 50.05 Kysi Tap-NsyiAse"Sri D 100.05 Krmt hunder-$uprapto D 50.05 .OX

Dines LLAJR progre_:

trafftic signls D 30.0 30.OX 40.05 0.5l 0.5I Intersectfon impravwments 0 0.5 20.50 20.0 20.0 20.5 20.05 Pedestrian iap4vmts 0 0.5X 20.05 20.0X 20.05 20.05 20.05 Signir4 wid mrking 0 0.50 20.0 20.0 20.0 20.5 20.05 Sus priority progrm_ D 0.5 20.5 20.5 20.0 20.0 20.05

Rahbilitatton ad MaIntenance: ...... Prilary reads a .OX 20.5 20.5 20.0 20.0 20.5X Swcndry and local road 0 O.OX 20.5X 20.5 20.5 20.X 20.05 - 106 - INDONESIA Annex 6 Table 2 JABOTASEKURDAN DEVELOPKENT PROJECT Page 2

...... WATAExpadi ture flto (S per 01T) /a " 0/90 90/9l "1l 9V9 93/%

Tecnical Assistance: ...... To Jabot" IUIDPassistance N 60.0 20.01 To DKI-Jakrta: LMFDAassistance: Project coordination D 10.01 20.05 20.0S 20.0 20.0X 10.X Futuro project preparation 3/C 20.05 50.05 30.05 31ne Pe ton revemwfepnut 0 50.0S 50.05 Dlnes LLAJRasistane: Tranport networkpltming L 30.05 50.5O 20.05 PubLictransport regulation L 50.5O SO.5 Parking polie L 100.5O Traffic *mnWgant L 100.5 DlnesPU mssistame: FED/constructionvemrvision 0 25.5X 20.05 20.05 20.05 10.5 5.5X Road mintanance 0 25.5X 50.5S 25.05 To DOSine Norge: s FED/conrtructionsuperviuion 15.5 20.05 20.5 20.05 15.05 10.05 To DC Lnd Transport: L Not. pubLc traport assistame 50.5X 50.05 PP assistance SO0. 50.5 DM aswaist aC 50.5 50.05 LLAJRair pollutlon menitoring 50.5 50.0X To DOCipta Karys future projects C 50.5O 50.05 Training DOLTRTTC training wrdequip.nt L 20.5 20.05 20.05 20.05 20.05 SATLAMTAStraining C 25.0X 50.5X 25.5X OKItraining (RCUT) I 50.5X 50.5X Total project coat ...... /9 Annu Inftlation rates: Domestic: S.5 3.51 3.51 3.51 3.51 3.51 Foreign: 1.01 1.5 3.S1 3.51 3.S 3.51 DONOSIA

JAUOTABC URBAN DEVMLOPMUNTPROJECT

Procurement Guidelines

Procurement Review Procedures

Prlor review requirements Aggre- Bill Post-award review Procure- gate Inst. to Tech. of Bid requirmaots sent limit Adver- bid/gen. specs. quanti- Contr. oval. I Prequallf. (contr. documents procedure (2) tlsement cond. I plans ties doc. award procedure bid eval. & award)

Equiument > $200,000 ICB no limlt /a, /b /c /f /h h Not applic. < $200,000 LCB no limdt / none none none none oee L < $50,000 LCB (prudent $1 million T T_ none none none none nose t shopping)

Civil Work, > $3,000,000 ICB no limit /a, lb d /f h t Not applic. not applic. > $1,000,000 LCB no limit /A __w 7i- l ] kO < $1,000,000 LCB no lidit W /e none none none none no_ LCL (force $900,000 7_ _e none none none none some !l, account)

not applic. Technical Asslstance - no llt l, b /a _h /h t

/a Generel advertisement placed In "Development Forum." 7 Optional specific advertiem ent placed in "Development Forum." 7R Documents to conform to provisions of lank's "Sample Bidding Documents for Procurement of Goods." 7 Docments to conform to provisions of Lank's "Sample Bidding Documents for Procurement of Works." If lanka concurrence Initially required on adiertising procedures and general conditions. Then Bank prior review necessary only changes ore made In the procedures or standard agreements. /f Standard specificacions to be used; specific provisions to be used as and when necessary. T Nonstandard documents specific to contract and not previously reviewed by Bank. All bid evaluations and award recomendations. 71 Procedure to be reviewed by Bank. 3 Review by World Bank, Jakarta Office. P Recording and relabursement by Statement of Expenditure (SOE) procedure. 71 Bank review of consultant short lists. 7i Documents to conform to lank's Guidelines for the use of consultants by World Bank borrowers. - 108 - AANNX7 Table 2

INDONESIA

JABOTABEK URJAN DEVELOPMENT PROJECT

Procuresent Guidelines

Sumaary of ContractingArrangements

Number of contracts DGBM DKI Total ICB LCB ICB LCB ICB LCB

Civil Works

Primary arterials 1/a 10 - - 1 10

Secondary arterials 2/b 7 3/d 7 6 14

Intersections l/c - 3/e - 3 -

Guidedland development - - 1/f 14 1 14

Trafficmanagement - - - 7 - 7

Total 4 17 2 28 11 45

Goods and Equipment

Traffic signals - - I - -

/a Outer Ring Road West - Section III.

/b Pondok Pinang-Pejompongan- Kebayoran Baru Flyover and Section III/Putri Hijau Flyover.

/c Harmoni Flyover.

/d Pasar Pagi Viaduct; Jatinegara-Sudirman(part); and Pejom.-Matraman (part).

/e Senen, Mlningkabau, and Pramuka-Matraman Flyovers.

/f Jatinegara-RouteCC connection. - 109 - AMT u Table 1

INDONESIA

JABOTABEK URBAN DEVELOPMENTPROJECT

Estimated Disbursement Schedule for Bank Loan (US$ million)

Cumulative Expected disbursements Semester project ex- Cumulative Profile/b Semester ending penditure/a Amount Amount % (X)

1 12/31/88 10.0 10.0 6.7 6 2 06/30/89 24.7 6.1 16.1 10.7 11

3 12/31/89 9.0 25.1 16.7 20 4 06/30/90 84.3 12.9 38.0 25.3 29

5 12/31/90 12.0 50.0 33.3 40 6 06/30/91 112.3 18.1 68.1 45.4 52

7 12/31/91 13.0 81.1 54.1 62 8 06/30/92 159.6 19.4 100.5 67.0 73

9 12/31/92 8.0 108.5 72.3 79 10 06/30/93 202.4 18.4 126.9 84.6 85

11 12/31/93 5.0 131.9 87.9 90 12 06/30/94 223.9 15.1 147.0 98.0 95

13 12/31/94 2.0 149.0 99.3 98 14 03/31/95/c 1.0 150.0 100.0 100

/a Includingnonreimbursable expenditures.

/b Urban sector profile for Indonesia.

/c Loan closing date. - 110 - INDONESIA Annexs Tale- 2 JABOTABEKURBAN DEVELOPENT PROJECT Page 1

TAU 2 - aEnU1IIW. PASIANPIUAICII 9 WUU ...... F im,ut LW ...... CiVil Works aM SWIgM4 ...... T...... otal....t ---- Ca_aNhtI/Agney simc (fat) mm Cant ilgole Not Tax Tot /I cat PwAiu al Prie Mt 0161 Cat x ...... 2.1 OsryhCam5mAt boed - Intrsectian Castryatfan: 33s3a 131.09 9,t1 14,67t 154,M 4,99 141.9" to 6 5.91

06 Bins Marga~~~~~~~~~~~~~~~~~~...... 11,764...... 65,515 ...... 4.919 ...... 5,6411 ...... 74.105 ...... 3.439 ...... 73.413 ...... 91.315

AM 11.7,4 14,7 1.101 1.2F1 17.049 3.413 20,477 32.3 KM 0 50.911 3.,61 4.410 "9.13 6 "5,134 ".13

lI-Jakart 21,W. 45,44 4.9"1 6.3W 73 S.4PA 0.349 106.1 ------..... -...... APO 21044 14,474 1,06 1.05 17,415 3.546 230,01 41,40 Ka a 51:0e 3 ,U 4,541 613W6 0 41,367 41.3w

Guided Lwd 0Owtlp t: 14,9 39,75 2.2 5.040 478,01 2.151 4952 44,94 17." ...... 02-Jakart AP 9.161 t ,71 50 673 0.05 1,646 973 16.93 31. 0 230650 1,774 3.076 23,499 0 23.49 2 .409 emyoran Sfte AM 5.311 Z,i04 156 39 2.510 505 3015 8,00 Ku 0 r.29s 547 as G,0? 0 r.7o 3,70

Traffic _Nagsmnt: 2,961 40.63 3,005 3.624 47.752 2.149 49,901 53., 14.32 ...... 4 cinSirm 0 44 3 62 9 44 1.013 1,013 ...... ------...... APO 0 169 14 14 2i 44 231 241 KM. 0 655 49 48 752 0 752 752

NI-Jokarta 2.963 40,019 3.001 3,762 46.70 2,105 46.00 51.67 14.02 ...... ------...... ------...... APO 2.963 7.739 so 743 9,062 2.105 11.146 14.156 LN. 0 32,200 2,421 3.019 3,7720 0 37.O20 37,720

Aldabilttatien ard Maintene: ...... OKI-Jakarta 0 5500 413 "42 6.554 295 4.549 6,49 1.92

...... ------...... AMI 0 0 0 0 0 295 395 295 31. 0 5.500 412 442 6,554 0 6,554 4,554

Tonicatl Asusitonce/Trainfng: 0 44.752 0 0 44,752 4,475 49.227 49,37 13.3 ,...... 00 Slns Megrg 3ll 0 10.329 0 0 10,329 10,329 10.329 APNN 1,133 1,133 1.133 DO Land Te_uort Ull 0 14,49 0 0 16"49 14,449 16.649 A1M 1.44 1,445 1.445 OK-Jakart 3II 0 12.640 0 0 12Z40 12."0 12,40 APN 1,246 1,244 134 00 IAMNoA 1u1 0 1114 0 0 1,114 1,114 1,114 AM 111.4 111 111 DC Cipta Kcrys 31 0 4,000 0 0 4.000 4.000 4,000 AMI 300 300 300

Total 51.610 261,953 16,290 23,404 301.047 16,044 317,691 349,501 100.02

...... /f Legend: APOI - Natfnl develomnt budt t 3ll - Foeign lton (I=) APO - OI Level I datq wont ISt /h Loan mo t apivstant to approx 701 of total project ceat not of taxes, disbrsed e foties:

Total Expdituro fInaned fro lton procecd Diaburssmsnt categor Agency cat - unt ----- (ip tn) S (p atn) (UI stn) S ...... 1. Civil sork DONN ,371 7a ".595 41.57 27.71 OKI 156,394 74 121,51 73.t4 49.22 2.05 DMI OX0 0 0.00 0.01 DN 6.554 102 6*,554 3.97 243 3. Equipmnt NI 5.776 1001 5.776 3.50 2.3X 4 Tech. ast/Tranini All 44.752 1001 44.752 27.12 5. 12 5. Lan ard tae All 67,6S4 oX 0 0.00 0.01

Total 369,501 24T,506 150.00 100.01 ~~~~~~~,,,...... -ill- Annex 8 INDONESIA Table 2

JABOTABEK URBl DEVELOPENT PROJECT Pg 2

TAKL 2 - 1 IT P01W FINAINS N 03.5-U Cit^rt...... T .... t ...... ~~~~~~~~S"tS...... FuWfIq Le...... Civil works aid eoupnt .... To.....a.. C I ONtJAsoly sceu cnst) TEarn mtisuis s et TM Totl /i Not Phicalt Prie owt cm & a Cast X ......

2.2 Suwmy by Agac:

DO 0nars:1ifs 11,7 76.756 4.962 5,743 P.4 0 4. 1,0 1637. 20.11 ...... ------...... ------...... AM 11,7 14.665 1,115 1.25 17,24 4.4 21.W6 33.56 I 0 61,695 3,W 4.453 70.21t 0 70,216 7.216

O Lwd Tr* st: 0 16.4" 0 0. 14."44 -1.4, 15.314 18,314 5.01 ...... ------...... _I 0 0 0 0 0 1.,4 1.4s 1,G4 KIU 0 16,"9 0 0 16,649 0 16,"9 16."9 0 1.114 0 0 1,114 111 1,125 1.225 0.31 ...... ------...... ------.. --- ...... Do00W*" M 0 0 0 0 0 111.4 111 111 uL 0 1114 0 0 1114 0 1114 1114 0.3x 0 4.000 0 0 4.000 300 4,300 4,300 1.21 ...... 0...... DCiptKrys AM 0 0 0 0 00 300 300 uL 0 4000 0 0 4000 0 40G0 4000 1.1 DKI-Jokarta: 34,013 154,032 10,603 16.749 151.384 8.859 190,242 224,255 60.7x ...... --...... APo 4.0013 20.923 2,16V9 3,471 34,53 8.659 43.422 77,435 KM 0 125,109 8.434 13,278 146.21 0 146,.21 146,821 KImyorenSito 5.811 9,400 705 1,112 11,217 s05 11.721 17532 .....-...... - --- ...... AM 5,811 2,104 156 249 2,510 505 3,015 6,6 0 7r,29s s47 863 6,706 0 8.706 8,706 Total S1,610 261,953 14,290 23.604 301,67 14,044 317,91 349,501 100.01 ----- ......

2.3 Sumiry by source:

MU: 17T.5 16,949 1,2 1,534 19,771 7.164 24,942 *.,5ss 12.11 I ... ~~~~~~~~~~~~~~...... ;...... 06 tinr NW" DIP 11,754 14,5 1.115 1.205 17244 4,60s 21,670 3456 !DC Lord Trwn pert DIP O 0 0 0 0 1,465 1,445 1.445 O oned DIP 0 0 0 0 0 111 111 111 jwClpta Krya 0 0 0 0 0 300 300 300 jK.mmranSf to 5,611 2,104 156 249 2.510 ss 3,015 8,626 EL: A 0 21,061 12,01 18u,99 247.50r 0 247r,s0 247r,5s 67.0 ...... ;...... 06 slni "woo DIP 0 41,6 33 4,45 7o,216 0 70.216 70,213 DC Lerd TraMprt DIP 0 14,"9 0 0 16.449 16,649 16,"9 Do Warm" DIP 0 1,114 0 0 1,114 1,114 1,114 I(LK 0 0 0 0 0 0 0 0 DOCiptC Kwyt 0 4,000 0 0 4,000 4,000 4,000 DKU-JakartO 0 125,109 6,434 13,2 1 2 0 14.621 146,021 Km¶-ren Si to 0 7,294 547 643 6,706 0 3.704 6.704 APM OKI-Jakwto 34,013 26,92 2,169 3,471 34,53 6.59 43,422 77.435 21.01

Totel 51,410 261,953 1,.290 25,04 301,847 14,044 317,691 369,501 100.01

...... ---...... INDONESIA

JABOTABEKURBAN DEVELOPMENTPROJECT

TABLE3 - DISWJRSENENTS(Ep million) ......

Coapnhnt 88/89 89/90 90/91 91/92 92/93 93/94 GO0 IDRD 001 1i8D 00G IBRD 0OD IOD 001 IDD 601 ISD ...... I......

Totaldisbursement (Rp million)18,475 22,243 24,801 40,712 26,435 52,661 24,147 53,786 19,619 51,094 8,516 27,011 ------. C------(USSmillion) 13.48 24.67 31.92 32.60 30.97 16.37

OK!disbursement (Rp million) 8,512 9,436 12,597 18,118 16,042 26,508 17,434 31,961 15,180 36,633 7,669 24,065 (USSmillion) 5.72 10.98 16.11 19.38 22.20 14.58 DMU disbursement(Rp million) 9,546 8,632 8,419 13,796 6,342 18,900 4,995 15,345 3,409 10,549 847 2,947 CUSSmitlion) 5.23 8.36 11.45 9.30 6.42 1.79 DGLTdisburse.ent (Rp sillion) 328 3,284 688 6,876 343 3,432 181 1,807 125 1.250 0 0 (UStmillion) 1.99 4.17 2.06 1.10 0.76 0.00 Otherdisbursement (Cp million) 89 891 3,096 1.923 3,709 3,741 1,537 4,653 905 2,612 0 0 (USSmillion) 0.54 1.17 2.27 2.82 1.58 .00 Special accountreplenishment (USSmtn) 6.00 /a 21.88 30.11 32.43 26.37 23.11 Cumulative 16.11 37.99 68.09 100.52 131.89 150.I0 ...... 03-Feb-88 /a Initial deposit Rp 10 billion equdvaLent; replenishment during yearassumed to totalRp 10.11 bin

i-'m - 113 -

INiESIA "_ Tele I

FInswial Statnte K-Jakwte 11 -u biliten) ...... *------tot Fical Yar ------tt .g e Aeeunt 1911/62 loam 1M/4 19641U 19650/ 191?6 MU" 2 grtt rate (Actual) (Actual) (Aetual) (Actust) (Aetml) (Actwl) S1/62/ -3 U1/U2-m7 ...... *OutimeAcesuat: Baceipte: Central gevt e.hId1es 62.5 6.5 66.5 74.2 9I. 1 108.7 4*2.5 31.2 9.7X Leatl turn. U.S 94.6 116.2 29.4 1336. 65.4 722.1 47.33 10.2X Serce earg la 20.2 25.3 33.9 41.3 42.5 46.2 209.4 13.72 16.01 Ltocl entsrises 2.5 3.2 4.6 6.7 4.9 10.1 32.0 2.12 14.4 Otber ;.2 5.5 6.4 22.6 31.9 10.1 60.9 5.32 50.OX Total receiPts 171.9 196.3 229.6 274.4 312.2 340.5 15X2.9 100.86 12.7X ...... ------.....-......

:...... *PerecansL 54.9 58.1 69.2 85.2 107.4 1!3.1 497.9 59.5X 14.4U Nuterfels 17.4 21.6 27.8 31.4 39.1 S.5 174.7 20.9X 17.6X RUpire nd Inmnt 9.8 13.2 13.0 16.9 17.6 17.2 67.7 10.52 12.4U IOthes 9.4 12.7 13.7 9.6 13.6 16.9 76.3 9.1X 7.92 Total eenditures 91.5 105.6 123.7 143.3 177.6 194.6 836.6 100.02 14.22 ......

Tremfet to ev t waent 80.4 92.7 105.9 131.1 134.4 145.9 690.3 45.22 10.86 D0lqm Accunt: leciptse Balance carried forward 26.9 37.2 59.2 76.S 66.6 29.0 295.4 2S.72 19.92

Central go..t day. grants/b 7.5 9.0 9.0 9.0 10.0 10.0 54.5 4.72 5.92 Tromfes frm routint cent 60.4 92.7 105.9 131.1 134.4 14S.9 * 690.3 60.0 10.8X Prperwty tax (IPEDAMIS)c 8.2 10.5 14.9 16.6 10.2 27.5 6.9 7.42 4.5X Oevalpnt lenow 4.2 4.4 0.7 8.9 11.8 9.5 39.5 3.42 22.9X Othrs/c -1.3 -1.9 -2.4 -2.8 -1.4 -7.4 -17.2 -1.52 1.S5 Total rceipts 125.9 151.9 167.2 239.3 231.6 214.S 1SO.4 100.OX 13.02 ...... Expand. distrib. nat Expwnditures: of surplus blance / ...... ------...... ~~~~~~~~~. Traportation 15.3 22.6 13.7 22.S 14.0 33.6 121.7 14.32 121.7 18.42 Edution 8.6 6.4 10.6 16.7 29.1 39.0 110.4 13.02 110.4 16.72 hoalth 21.9 4.2 11.1 3.9 7.S 10.7 59.3 7.02 59.3 9.0X C nity h&Aing 0.1 2.5 0.6 2.1 3.3 6.5 15.1 1.82 15.1 2.32 Deprtmontal expnditures 11.1 5.3 19.3 9.5 11.5 19.3 76.0 8.92 76.0 11.52 Corce 1.4 1.3 0.6 4.1 3.4 7.4 18.2 2.12 18.2 2.8X Otner/d 26.5 45.8 51.3 107.7 123.7 53.3 406.3 47.9X 216.0 32.7X SUrtotel 84.9 86.1 107.2 166.5 192.5 169.8 609.0 9f.9X 616.7 93.42

Debt service 3.8 4.6 3.5 6.2 10.1 15.2 43.4 5.12 43.4 6.oX Total expsnditures 88.7 92.7 110.7 172.7 202.6 185.0 652.4 100.02 660.1 100.02 ...... ----- ......

Closing balance 37.2 59.2 76.5 66.6 29.0 29.5

...... lae Chargn d Incr_ from servico dapsrtanta /b IWUS Doti I only; not including I1MES Ooti II _mnts received by Levtl II amcies In OKI: 1981/82 1962/13 1913/84 1964/85 19S/16 19J6/87 Total ...... ------...... 23.1 27.5 32.1 52.4 56.8 60.5 191.9 /c Oroas receipts; standarddactions included In 'Other' div. reipts ltin /d Including urccounted-for differnces beten recorded ad actual clcains balance as follows 1961/82 1962/83 1963/84 1964/5 195/86 1906/87 Total 15.....6------...... 15.6 21.9 33.7 Wa. 54.3 -30.3 192.3 - 114 -

Tale 2 1O66A 0s I

ffnecafl projection. KI-Jakwta 9S7/S-1M5i, - p billion) ...... '''''''''''------I...... 1 m fftTw...... ,,,,,,,,,,,, Acounit 1W/U 19w9 "PA 1C / 11/911 1"M19 1M/ 1/ 1""In grW& rte forecat fore t Frect forecastFrct foeat foest foe t fooat a6/-96 ...... Rotifne'AccoAsta

eceipts:

Central so't suk.de/s/a 117.4 15.6 136.9 147.9 Y. 172.5 15.3 1.2 217.3 6.01 tocal taxes/b 185.2 203.5 2.4 10.3 21.5 3.5 M5.6 40.5 46.7 12.91 SarvIcochagoe/b 51.7 56.0 ".9 72.7 81.4 9.2 102.1 114.4 13.1 12.96 Loal enterprses/b 11.3 12.7 14.2 15.9 17.6 19.9 22.3 25.0 U.0 12.96 Othe/o 10.9 11.8 12.7 13.7 14.6 1.0 17.3 IS.? 3.2 6.911 Totat rwcepts 376.6 416.7 461.1 510.5 545.3 45.1 6U .7 M.6 052.3 10.73 ...... Expenditures; ...... hisam 1/0 132.9 143.6 155.1 167.5 130.9 19.3 211.0 227.6 26.1 8.96 ; atiarfts/c 4.2 52.2 61.5 72.6 65.7 101.1 119.3 140.6 166.2 18.09 Repairs nd m_Intewnc/c 20.3 23.9 20.2 33.3 39.3 46.4 54.7 64.6 76.2 16.96 Others/a 16.2 19.7 21.3 23.0 24.6 26.6 2Z.9 31.2 33.7 6.03 Total expnditures 215.6 239.3 2W.1 296.4 330.7 369.6 413.9 46.5 522.2 11.72 ------...... Transfer to Dew't accoit 161.0 177.3 195.0 214.1 234.6 256.5 279.6 304.4 330.1 9.4X

Develtont AccoLmt: Ieceipts:

Utence cwrrfed forward 29.5 14.8 10.0 5.7 8.6 24.6 45.5 72.4 48.3 Central govlt dev. grents 10.0 10.0 10.0 10.0 10.0 10.0 10.0 10.0 10.0 0.0l Truwfersfro routine cent 161.0 177.3 1ff.0 214.1 24.6 256.5 279.6 304.4 330.1 9.43 Property tax CIPEDA/M)/d 33.8 38.6 48.6 64.8 5.0 95.6 102.7 110.0 116.7 16.93 Deeopment loons Others/a -3.4 -3.9 -4.9 -6.5 -8.6 -9.6 -10.3 -11.0 -11.7 16.l Total rwceipts 230.9 237.0 256.9 26.1 330.7 377.3 427.7 4U5.8 493.5 10.0O ...... Expenditures: ...... -eportationfe 35.3 27.9 33.9 39.5 43.2 43.5 39.0 68.6 75.6 10.03 atin. 41.0 45.0 49.5 54.5 60.0 66.0 72.5 79.6 57.6 10.01 Ith 11.2 12.4 13.6 15.0 16.4 18.1 19.9 21.9 24.1 10.03 saii.y hosing 6.8 7.5 8.3 9.1 10.0 11.0 12.1 13.3 14.6 10.03 srtrAinttl eenditures 20.3 22.3 24.5 27.0 29.7 32.6 35.9 39.5 43.4 10.03 wece 7.8 6.5 9.4 10.3 11.4 12.5 13.8 15.1 16o7 10.03 ...ara 57.6 96.6 106.2 116.6 126.5 141.4 155.5 11.1 188.2 10.03 Subtotal 210.1 220.2 245.5 272.2 2g9.2 325.1 346.7 409.4 450.4 10.03 Debtservice (existing) 6.0 6.6 7.7 7.3 6.9 6.6 6.6 5.9 5.3 -1.53 Debt c rvice (AJOP1)/h 22.1 22.1 Total expnditures 216.1 227.0 253.2 279.5 306.1 331.9 355.3 437.4 477.8 10.4X ...... ----...... ----......

Closing balane 14.8 10.0 5.7 6.6 24.6 45.5 72.4 48.3 15.7

* Note: Fer asuaptfon a" attachd footnote list (pog 2) - 115 -

Tobm 2 pw 2 TlAM 2-- FINWCIALPTICTII - ASUWTIUS

/e ftutinr grants asa.d to Increas C.0 p.o. (41 gOt d 4.KX inftlotIn) hb Tom assid to increase 12.0X p.o. (U Xroat ptus lntlttion) is eN asamd to Increas 1.O p.s. (141 gowt plus intletion)

/d PS growth essuad to ceotnor to tellowing targets: 19/U INS/1 195/090 1990/91 191/92 9M9 19M/93 1994/9 19S/U ...... ------...... ------...... Registrations (641) OX 5X lOXO 5X 21 1X Is 1X Valuation 1 4X X 151 15X 41 4X a1 a Aaaesamnts (20X) 01 ox OX OX 01 ox ox OX Os Coltections (401) 0o 51 lOX 101 lOX 51 21 21 11

Total ail growth 4 IS% 2a" 331 331 llX 71 71 a

Clotative growth 41 191 S0X °9X 1651 191S 21eX 238X 259

U.S. (D0 Pajok projectionr) 301 20% 31X 371 501 331X 30 211 (DO Poajuc uu tlative) 301 51 1151 1951 3421 4881 665126a

/e Stwuiard MUdeductions /t Expenditure growth s aumd to be 10.01 p.s. 61 growth plus intlottcn) /g Inctluding KI'x JUDPI project exponditure: 1968/89 1909/90 10/91 1991/U2 192/93 1993/94 Total ...... ------...... ------...... DOI direct cash contribution 8.S 12.6 16.0 17.4 15.1 7.7 77.3 DKIborrowing (SLA) 9.4 18.1 26.6 32.0 36.6 24.0 146.7

Total 17.9 30.7 42.6 49.4 s1.7 31.7 224.0

Total as X of maaloble dvtmop -nt turds 7.41 11.91 14.0X 14.91 13.71 7.4"

Borrowing as X of dav funbd: JUDP I borrowings 4.01 7.01 9.21 9.71 9.71 S.41 Total berrowings 6.6X 10.01 11.8% 11.8 11.51 7.21

JUDP I expsndtturw as X of total dlv. *xpediture 88-94 12.81

Debt service as X dsv. fund 2.91 3.01 2.51 2.1X 1.1 1. 5.OX S."1 Debt service *r I ot NU 19.11 19.81 16.91 13.91 12.01 10.31 38.41 37.01 ceiltnq (151 058)

/h Sub-loan gremnt tass 101 Interest. 20 yers repaym nt, S years grace - 116 -

Annex 9 Table 3

IUDXUESIA

JABOTADLUtRAl DIVU03T PJIJECT

Road Cla- dification: Aane Financi l Responsibilities/a

--- Road classification --- Item Primary Secondary

Land acquisition C L

Road construction C L

Road improvements C L

Traffic engineering L L

Traffic signals (investmentand O&M) L L

Signing and marking (investmentand O&M) L L

Street lighting (investmentand O&M) L L

Routine maintenance L L

Periodic maintenance C L

Rehabilitation C L

Legend: C - Central Government L - Local Governaent

/a Draft; based on agr-ementsunder Loan 2817-IND - Regional Cities UTP - 117 -

Annex 10 Page 1 i-DLA

JABOTABCKURBAN DKVUOPKIT POJECT

Knvirotmntal Ict

1. Care has been excrc-.sed in the design of this project to avoid or eliminate possible long term negative environmental impacts and to mitigate the short term impacts of project construction in the Jabotabek area. The project is also intended to contribute to the protection of the environment through regulatory and institutional development features which should be of benefit not only to the Jabotabek area but also of national significance.

2. The environmental concerns addressed by the project are classified in three broad areas of potential negative impact: (a) metropolitan area growth and its impact on surrounding land use; (b) vehicle emissions and their imoact on air quality; and (c) construction and its impact on the local population, chiefly in terms of its land acquisition and resettlement consequences.

A. Land Use

3. Recent Jabotabek metropolitan development planning studies supported by Loan 1336-IND (Second Urban Development Project) identified land uses in the areas to the south and north of the existing Jakarta urbanized area as unsuitable for dense development on environmental grounds.

4. The area to the south is productive agricultural land which has also been identified as an importact acquifer recharge area of critical importance to Jakarta's groundwater supply on which over 70% of its 8 million inhabitants currently rely. Dense development of this area was forseen as likely to both reduce recharge and cause pollution of much of the remainder. Control of development by DKI-Jakarta in this area is difficult because much of the area concerned lies under the jurisdiction of the adjoining Province of West Java. Close collaboration is needed between the authorities concerned in order to identify the extent of the sensitive area and to apply and enforce appropriate development controls in this area. However, controls based on environmental concerns have either not yet been formulated or not yet implemented by the respective Governors who are the responsible authorities.

5. The area to the north (which is fully under DKI-Jakarta control) is coastal swampland typical of many parts of Java. Such land is difficult and expensive to develop and service due to poor soil conditions and flooding hazards. It has however attracted major facilities in the past such as the Tanjung Priok harbour and its related industry as well as the Ancol recreation complex (sited on reclaimed land). The area has therefore - 118 -

Annex 10 Page 2 become a significant soturce of employment. But like many sarginal lands in such circumstances, it has also become the home of many lov income citizens of Jakarta. North Jakarta's Kampungs are among the most badly serviced areas of the city. DKI-Jakarta has great difficulty providing even essential services to its North Jakarta citizensbecause of the development costs involved and wishes to discouragefurther commercial and industrial development in this location to avoid exacerbatingthe area'ssocial problems.

6. Under the growth pressuresfacing Jakarta there is considerable pressure to develop in the sensitivenorthern and southern areas (as well as to increase densities in establishedcentral areas) due in large part to the present north-southorientation of Jakarta'sroad system which has emerged from the historicalpattern of trade movement. Access to lands in the eastern and western areas of the city, which are better suited to development at reasonablecost, is severely constrained. In order to counteract this trend DKI-Jakartahas committed to develop an alternativeeast-west developmentaxis which is now embodied in its developmentMaster Plan (RUTR 2005)--basedon a Jabotabekmaster plan prepared by a national planning committee chairedby BAPPENAS. The plan provides for a reasonabledistri- bution and balance between residential,commercial and industrialland uses and developmentdensities for future development,as well as appropriate recreation space having regard to the strong economic considerationslying behind the plan. Its success however will depend upon the provisionof adequate access to the new areas and capacity in cross-town links to facilitatemovement between the areas.

7. This approach reflects a policy of 'GuidedLand Development'by DKI-Jakartaas a positive means of influencingdevelopment patterns through key urban infrastrucureservices rather than reliance on land use controls which have proven singularlyunsuccessful in the past. In the case of environmentallysensitive areas which should not be developed,such as the northern and southernareas in question,it is also necessary to impose enforcablecontrols as well as deliberatelylimit services in such areas. However, this strategy can be frustrated in Indonesiadue to the ability of CentralGovernment agencies to initiateand implement well-meant development in local govenment areas but without meaningfulconsultation. In order to help avoid such conflictsin future,the Government has decided to decentralizeurban infrastructureplanning responsibilityfully to local governments and to program infrastructureexpenditures by all levels of governmenton the basis of an integrateddevelopment plan.

8. The project will support the implementationof DKI's east-west development axis strategy through (a) constructionand improvement of development roads and key arterial links, and (b) through a study of the environmentallysensitive southern area and the necessarydevelopment controls. It will also support the integrationof planning and programming in the Jabotabek area through establishment of the institutional mechanisms and capacity to implement this (see Annex 1). As part of the formulation of appropriate environmental protection criteria to be included in the appraisal of proposed expenditure program components,the abovementioned environmentalstudy would strengthenGOI guidelinesfor environmentalimpact - 119 -

Annex 10 Paice 3 analysis/l in infrastructure development. The guidelines would be a, Lied in future road development feasibility studies, commencing among others with the study, supported by the project, of the proposed Pasar Minggu-Depok Road improvement which would traverse the sensitive area to the south of the city discussed above.

B. Vehicle Emissions and Air Pollution

9. Uncontrolled vehicle emissions constitute a major cause of air pollution in large cities where heavy or congested traffic conditions occur. Jakarta suffers acute problems in several locations for this reason from time to time although official monitoring records indicate tolerable and even improving conditions in the city as a whole. National regulations being formulated by Ministry of Environment, are still in draft, but DKI-Jakarta has issued ambient air quality guidelines. Recent tests at city bus terminals showed Total Suspended Particulates to be 500 micrograms/m3 in contrast to the tolerable level of 260 specified in the guidelines.

10. Important influences on vehicle emission concentrations such as land use planning, road network development, and traffic engineering development are being addressed in Jakarta, and the improving trends in overall quality can be attributed to some extent to improvements in these areas. In addition important initiatives are being taken to reduce lead content in motor fuels, but other aspects of vehicle technology (engine combustion, catalytic converters, etc) are several years away from serious consideration in Indonesia.

11. A critical area of action needed lies in further reductions in congestion by means of traffic restraint and public transport development, particularly a clean mass transit system. These are longer-term measures, as is establishment of a pollution control authority empowered to set policy and enforce appropriate regulations. However, in the short term important

a A fundamental problem facing environmental protection in Indonesian development programs is the lack of environmental engineering capacity in the public works agencies of central and local government agencies and their local consultants. Loan 2258-IND (First Ministry of Public Works Manpower Development Project), is currently supporting development of environmental engineering policies and criteria in the Ministry's Bureau of Planning. Although establishment of criteria and guidelines will be an important step, the training of urban planners and engineers in environmentally sound approaches and practices, and the establishment of environmental resources units in public works agencies will be essential to achievement of meaningful results. The Bank's support for establishment of environmental resource management curricula in higher education programs in Indonesia (Loans 1904 and -IND) should improve awareness and capabilities of Indonesian practitioners to address environmentally related development issues in the longer term. In the near term there is a great need for in-service training of government and consultants' staff to equip them to address the issues to the extent possible. - 120 -

Annex 10 Page 4

steps towards institutionalizationof air pollutioncontrol would be to:

(a) improve the present monitoring system in order to (i) better quantify the components of Jakarta'sair quality problems; (ii)better identify and prioritize critically polluted areas; and (iii) identify related adverse impacts on health;as well as (b) improve engine maintenance (particularly diesels) throughbetter vehicle inspectionand enforcement.

12. Monitoring of air quality in Jakarta is carried out by the MOC'c Geophysicaland MeteorlogicalCenter (BMG - 5 fixed stations),DKI's Urban Research Institute (P4L - 4 mobile stations),and the Ministry of Health (DepKes - 2 fixed stations). These stations are equipped with only high volume sampling equipment and when operationalare capable of monitoring only a few parameters (Total Suspended Particulates, S02, NOx, and Ox). MOC's Directorate of Road Transport (LLAJR) is responsible for vehicle testing but has few test centers (which concentrateexclusively on commercial vehicles)and is poorly equippedwith smoke detectionor CO analysers.

13. In order to help Government upgrade its air quality monitoring capabilitiesan air pollution control expert would be provided under the proposed project to (a) advise on air quality and vehicle emission control policy; (b) evaluate the existing monitoringsystem and recommend an appropriate upgrading program (with equipment to be procured under the project); and (c) advise and train GOI staff in use of the equipment and in analysis and interpretationof the data. Outline terms of reference are given in Annex 5. These would be refined by LLAJR which would take the lead in forming and chairing a working group to oversee the developmentof the monitoring system.

C. Land Acquisitionand Resettlement

14. All road constructionand improvementcomponents were subjectedto a cursory environmentalimpact analysis by the consultantsduring the feasibility study phase. All schemes were systematicallyexamined to some degree against a list of criteria including:conformity to Master Plan and impact on existing land use and communities (includingland acquisitionand community severence),traffic and pedestrian impacts; services and utilities disruption;land values; and expected pollutiondue to noise, appearance and vehicle emissions.Many components consist of improvementsto existing roads and in such cases it was possible to assert that conditionsafter improvement would be better than before. In cases where permanent intrusions (e.g. vehicle noise) or temporary negative impacts from construction were identified these were minimized to the extent thought appropriate and weighed against expected benefits to arrive at an acceptablenet positive benefit. The examinationswere, however, based mainly on subjective judgements followingdiscussion with the implementingagencies. Although one proposed component was rejected at appraisalon environmentalgrounds (due to possible adverse developmentalimpacts) it is unlikely that any major errors have resulted in the remaining individualcomponents. (On the whole urban services projects in Indonesiausually result in net positive - 121 -

Annex 10 Page 5 environmentalbenefits due to their main purpose in relievingenvironment- ally bad conditionsresulting from existing low levels of urban services). The sole residual major concern lies in the magnitude of the aggregateland acquisitionand the possible displacementand resettlementimplied.

15. According to GOI estimates about 10,000 households and businesses will be affected by the project. This very large program (to be carried out over about 5 years),will touch some 40-50,000persons and disrupt -uch economic activity. DKI-Jakartawould be responsiblefor the acquisition program which would be carried out by land acquisitioncommittees. Well establishedand reasonableprocedures exist to process the acquisitionsand compensate ownersZ2. Adequate budgetaryprovision has been made for the compensation. A coordinatedplan for acquisitionof the land was brought to negotiationswhich will follow these procedures. The details of the properties to be acquired and the relocationsinvolved are giver in *;he followingTable.

16. Actual relocationsrequiring resettlement are expected to be comparativelyfew since most acquisitionInvolves only a narrow (2-3 m) strip of land along the involvedproperty's frontage. In most cases the owners are able to rebuild or modify their dwelling or premises on the same plot and continue occupancy. Persons most affected are renters and squatterscrowded out by the plot reductions. DKI-Jakartapays only monetary compensationand in the case of affectedpersons who are not property owners it attempts to help such persons find PERUMNAS rental housing or, where requested,to help them join in transmigrationschemes or return to their native village. Business owners (if licenced)are compensatedfor loss of economic activity accordingto a set rate.

17. Progress and experiencewith the acquisitionand resttlement program would be monitored by the Project CoordinationOffice (JUPCO) assisted by the project management consultants. Details would be reflected in the quarterly report. The early experience would be evaluated by JUPCO and its consultants by June 30, 1989 and any improvements necessary in the procedures or their implementationwould be incorporatedin the later phases of the program.

/2. Procedures for land acquisition in urban areas are based on MHA Instruction No. 2/85 and have been further developed by DKI-Jakartaunder Governor'sDecree No. 700/86. The MHAinstruction prohibits the forcible movement of people and there have been few com plaintsby persons in urban areas affected in the past. DKI procedure includespublic meetings to present the project to the community affected and to take its views into consideration.The right of way for the agreed scheme is staked out to determine the property affected.A land acquisitioncommittee is appointed by the Mayor which meets with individualowners to collect informationand discuss values and compensationfor the land and its improve ments (buildingsand ancillary structures,crops, trees, etc) according to various categoriesand criteria. The committee'srecommendations are sent to the Governor for final approval. After approvalompensation payments are made by the project office followingwhich clearancemay proceed. - 122 -

_ 10 mIIA T*lo

LWdA_usitiu l _Ao lb. of steimm to beWtlaiVy or tsdlt dmotiabd

3iet- Am d. of TStU _ m- ---- P eV---. Yw of of-uw to be plot m. of Ptemmm psimt Tosremy I coItm c_nuwmt Cotruct Ot As rod offstt otfiutM otniet. eUsWt eo_ ts as is aIPmn) the) /A (O1/A) /d NOed u Inteersetlon C tructln: ...... Kajor rterial r_e:

OuterRtig Road Wet 1 5S.50 43.9 2al Pw 1" 0 1003 ter Rlngr od South I $,100 S.C 19 19o 190 0 1001 Swcondaryetew at roa :

tmmit-Lingksr 1 250 0.3 2 0 tOOX Pfn w-foJo apang 1 640 0.6 9 9 9 lO10 fnWumD-epok t 460 4.0 l6 I 1 0 1001 Psr Pai 1 1,90 1.5 312 342 ZO a 51 3/S1 Tobus Jetinesgr-S4dirtn 2 9.537 16.0 96 977 43 42 332 40X 3/91 Tabus P.jopesum.listrmn 3 7.500 6.4 m 672 432 21Z 22 OX 3/93 NIjror ntesoctfa.:

Nrmoi feltvor 3 4M 0.3 1 1 1 0 1001 Senanftlyor S 1.45 2.0 190 1ZB 12t 0 0 3/92 Niningkbbu flyovr 4 0 1.9 150 133 54 24 40 0 3/91 Prmuke-Nhtro_ n ftyowmr 5 1.492 1.2 *6 64 56 6 0 01 3/92 Eost *nd Wet Guided Lsd Dotslpm ut:

Estern Armc:

-oute CC/FF 2 T001 65.4 3270 756 510 116 130 0 3/89 RouteEE 2 1t300 9.4 446 20 9 2 114 as 3/US Jstinegara-Routo CC carcntf 4 0 4.2 Z60 342 178 11 53 0 3/91 We ton Arto:

Route I 1 0 30.6 29 lSS 67 1 6041 3/69 RouteD 2 0 40.6 2116 1140 444 155 541 319 RoutoE 2 0 2.1 112 f5 39 19 7 3/91 RouteF 2 0 0.6 36 27 19 3/91 Routc1 2 0 3.9 214 94 34 20 40 3/91 Traffle _anhgmnt: ...... _ Aros/corride lprovomnt: K.ayoran Les c 3 544 Vna 100l TwnshAbag 1 1 1092 2.6 I" 314 205 109 0 0 3/69 Tuu Toni 3 0 0.0 Roam Soid DIpnhgro 2 0 0.0 D.Sartikr-Kr.Jatl-Rays Magor 3 552 n/a 0 3/90 Total 4511t9 250.7 10.03 59" 33441 1,046 1.455 ...... / TOar1 I 01 FY18 /b Approimto umo ascertained from awfeal auvy photogras /c Approxt_tly 5 pero per household /d Acqlsition wilt in eeral multi-yew project ceam proeed in stgm. - 123 -

Annex 11 Page 1 -IA

JADOTAD nUDA DNW=AOINT PR*JECT

Analysis of Economic Benefits

1. Costs and benefits of the various conponentshave been compared between several options by means of benefit-costanalysis conformingto the methodology and criteria describedbelow. The feasibilityindicators consist of the First-yearRate of Return (FYRR),the Internal Rate of Return (10 year IRR) and the Net Present Value (10 year NPV) as calculatedat a discount rate of 15% per annun. The sensitivityof the indicatorsto changes in costs and benefits was assessed for each option assuming an increase in costs of 20% and additionallya decrease in benefits of 15%. The results are summarized in the followingTable 1.

Hethlodologx

2. ProJect Costs. The evaluationsare based on economic costs and benefits at constant end-1985 prices. Costs are estimated net of tax but include routine and periodic maintenancecosts equivalent to 2.5% of capital cost (excludingland). Environmentalimpact costs were assessed as marginal in virtually all cases and were not quantified.

3. Benefits. Benefit calculationswere consideredseparately for the periods prior to and following commissioningof the facilitiesconcerned. Benefits were calculatedon the basis of forecast reductionsin vehicle operating costs and time costs for traffic moving at the morning peak hour based on 'with project' and 'without project' scenarios. Traffic flows and vehicle distances were calculated for various 'base years' (1990 and 1995 for trafficmanagement schemes plus 2000 and 2005 for road improvement schemes) by means of a computerizedtraffic network model for Jakarta. Vehicle speeds were assessed for each road link concernedenabling costs per vehicle-km to be compared for eight representativevehicle types based on fuel, oil and other running costs, as well as vehicle standing costs, passenger and goods time costs and accident costs. Annual benefits were taken as equivalentto 3,250 peak hour benefits.

4. The vehicle operatingcosts used (running,standing and accident costs as derived for urban conditions)are shown in Table 2 for selected speeds. The value of time saved is also an importantbenefit to all urban transportationimprovements. Even at the highest speeds they comprise 56% of total costs for buses, 42t for light passengervehicles, 35% for cars and 28% for taxis. The time savings values used are shown in Table 2 also. Full details of the economic analysis procedures and derivation of the costs are available in the Project File (Annex 12). Details of the economic analysis of each component are given in the respectivefeasibility study also available in the Project File together with a summary update. JA0TUAK 133I EWOFtEUT PRECT Eenomic Arlysis Slunry

...... to gasitivity CUwit taigt Capital cest Ecoeic _A t ------Forect trtffic------Cacity ----- FM I WV Cestat= cesta Cko) Total cost/t i etu 0 cost 1990 19iS 200e 2005 Existing Prop (la yea) (Is war) if to -S mots-151 ------( Ip an) ------t onro--e-- )a)I ------X t pgln X I ...... _... Roadmrd Interstion Contruction: ...... ilJor arterial roeok: Outer tire RoadVast/c 10.6 25.906 4.861 4.146 s09 1400 2`170 3180 4300 2730 4250 66 1. 3,662 38 3 Outer Ring Road 10.0°uth/a/c 22,109 2,211 3,650 522 2400-3550 1050-5760 2610-3650 3280-510 27SO-4250 4250 102 "623 U 7 Semrmy arterial roeof: Melt-Lingker/a 6.6 6,934 748 "6 S2 1930-22e9 2679-3676 3907-49M9 503-6424 4950 4950 22 33 5,0 2 2t Pilng-P.jf pnganfe 5.9 20,765 3,519 3,005 472 1647-4205 20f2-4040 2909-5275 390-6351 3700 4750 67 79 29,11 67 s5 Nlinngu-0spok/a/c 14.4 8,296 S76 45 619 G00-2700 2700-3000 3000-3900 4100-5300 2250 5950 22 10 79568 Poer lagi Viaduct 0.9 20,405 22,672 19,271 317 2000 2500 /b 4000 38 40 21t316 Is o0 Tebus JatineWr-Sudfram 6.0 27,555 4, 593 3,904 377 7000 90o /b e SO 39 25.513 3S 30 Tein Paejaporgai-Natrrn 6.7 24,237 3,617 3,076 340 3499 4576 lb 4667 30 31 9,74 27 23 Najor intoruetins: /d lannIflyover n/a 9,010 nVa 7,658 131 4000 4300 3100 4000 a2 72 17,446 62 55 Srn flyowar nea 9,610 n/e 9,274 146 4376 4447 /b SO0 83 73 3,30 63 s5 Hiningkobu flyover nV 80035 n/a 6,830 9 1 3721 lb 4150 28 37 4,223 31 27 Prm*a-Natrmn flyowr nr 8,721 n/a 7,113 174tb 6000 72 65 97 5S 49 Ecrt and Vast Guided Loed 0evlt nt:

Eastern Areas/c: Route C/FF 5.1 11,612 2,150 1,828 163 1400-3700 6000 3200-6000 6000 67 75 25.5 a 56 Rleute EE 7.3 3,841 526 447 34 1300-2100 2000-4400 2000-4400 4400 29 4e 2."7 33 as

Vetern Ares/e: Rtute O 3.2 3,071 we 816 as 1900-2400 2300-4400 lb 275s-4400 47 56 3,625 4 3 i- Rlute 0 0.1 12,053 1,488 1,265 247 1100-41000 400-s50 lb 6000 45 57 tlMM 1. 40 i Route E 7.3 942 129 lO 22 500-900 40O0-5900 1925 6000 13 44. 1442 39 34 Route F 05 512 1,161 990 9 900 325O 1925 6000 43 S ,I'm 50 43 Route 2.8 124 4 38 3 1300-1900 4400 lb 4400 514 5 175 48 41

Traffic Naiemnt: /d ...... Are/corridor id rvnt/2 : / Kesyrn Lm network 1,513 n/a 1,286 Is 2115-2553 2053-27 840-2900 3500-56r n/ na 9,831 Tbah Abaig I network 4,194 nfa 3,565 60 126t-2141 1652-2e05 1004 2500-3500 n"t n"t ,.6 Tugs Tail -4.r 684 Va 411 12 3049 /b nVa nea n/a S, Rasuss Soid-olpogoro netwkrk 185 nra 1S 4 Intersction isrovesants nWe n/a 1,179 D. Sartike-Kr.Jeti-Rwa er netwkrk 2,523 n/V 2,060 54 Intersction iprw_entsxWe n V 5,7ff

Su priority mtsues/: Cwie Sati-JatinWMra 8.7 3,017 nV 295 4352-7181 4760-9440 41760-900 nVa Va 12 I" Kyai Tep-Nayim Asyhwa 3.7 403 n/a 93 1n425-30M5 1S41-4151 240-.520 3020-4720 W/ /a 12,9 Krmt Sundar-Dpeprto 4.4 2,357 nao 455 4392-6300 4745-67M5 £00-6520 6000-76 na n"a t6 ,

Dines LMit traffic progrf network 32,706 n/a 29,509 n/a n/a "/a n/a env n/s '00 '406

iRdoibitation aid ftintend: d ...... Secandery letwat roed/g network 5,914 n/h 5,323 nV "tor/a n/a Va na We nl '00 '40

Total 2751la

/0 Traffic date reprsentotive for mtinpto etie with differing traffic dinidP lb No existing rod /C Capital costs Incude for e sptt (94 bllion total) not Incltud in iSP t; Stag I ben its ae coprable /d Total t _ cIC t of e t Jo Tneic ItliU >00t for traffic n nt adg If Inctuding traffic sipult, interection ad _eetrim ioints sitl min ranrkin mi b priority _esures / Pt_ prxop- of routine ad periodic aIntwoc e cted l typically 100 'i amlWis - Velict, pwatie, Tim ad accidt costs by Vehicle Ti9 (9p/ba) ...... I...... Cal (is) (2) (3) (4) (5) (46) (lA) luk .. . bOar epsi.. ---- .. - PrV ca. . Tl - Lt ea r ------..... - - Lit-- _e .. la a 4 1o a5 46 J 4is is 3 wup speed (W) 1s 3e 4S 15 30 45 Is 30 45s O 20 so Ovara h 40 10 25 Is a 4 3 46 I a Be Is 30 45 1S 50 45 11 24 ...... Aveu_ smomn i( w) 15 30 45 ......

Iestir, Costs ...... 9.3 64.1 56.6 5.4 164.2 13.5 17.6r 15.3 1A 476 5L4 34.6 _dnoiscert/b 73.8 56.9 so. 73.f 56.9 $5.1 100.0 70.7 62.3 22.1 195.6 146.9 106.0 133.1 53.3 33.3 35.3 134.1 6.9 6.1 6.1 6.1 S1.1 5.6 1 .6 nt iu ctic 46.S 46.5 4.5 77.2 36.6 28.? 124.4 43.2 42.1 317.9 15.o

52.7 2M.3 242.7 I5.1 28.4 2n.? W.S 2.6 5S.6A leTta 120.3 105.4 101.6 151.0O 97.. .6 26.4 133.9 100.4 544.0 354.6 292.9 22.4 MA.4 3.9

Tim costeid ...... 310.0 6.9 6.3 0.2 6.6 3.4 2. 12.2 Li 6.1 3.3 14.7 9.6 p_eer _d ti t cos s 1u .s E. 55.6 I0.S 50.3 33.5 454.0 117.0 73.0 713.0 565.0

10.6 4.0 4.0 4.6 6.6 6.6 6.6 4.6 4.6 4.6 2.6 2.6 2.6 Acci. cost 4.0 4.0 4.6 4.0 4.0 4.0 4.0 4.0 4.0 10.0 16.0 ...... *.....

23.S 11.? 94.1 54.3 3 3.7. 2.M 4.3 315.5 32. U19 3.? 6a.4 Tot 29.6 195.2 W1.4 85..S IS 116.3 464.4 25. 166.4 1724.0 9.6 402.9

...... to Lte-O price l Icludirenget of tw,. *l, tires. mint_te (pwet_ad 1*1w), ad Mive-bond eleclotion /C mcludlag cast of timbasd dI istia. I itrst (151 P.*.). dr*ivwerr . ad 5iaembr id _sasur tia vl ta basedae ¶96 m inten m edJetod Op15t pa. wd wiflted fwr bairer d Wlw* um. os tin vata baWden ipliad iuwetp cost raatim seeinq 17.12ft1. - 126 -

Anne x 12

INDONESIA

JABOTABEKURBAN DEVEIOPMENT PROJECT

DocumentsRetained in Proiect Files

1. Jakarta Transport InvestmentProgram Review June 1987 - JUTP Consultantsto DirectorateGeneral of Land Transport. 2. Perum PPD and DANRI Operation Study 1986 - JUTP Consultants to Directorate General of Lane.Transport.

3. National Public Transport Policy Study - 1986 - JUTP Consultants to Directorate General of Land T:'a.-eport.

4. Jakarta Nass Transit Options Study. - 1986 - JUTP Consultants to Directorate General of Land Transport.

5. Traffic Restraint and Parking Policy Studies - 1986 - 87 - JUTP Consultants to Directorate General of Land Transport.

6. A 5 Year Indicative Program for Traffic Engineering anh M-nagement on DLLAJR, DKI 1987 - JUTP Consultants to Directorate General of Land Transport. 7. Jakarta Traffic Nanagementand Road Network DevelopmentStudy 1982-83 and 12 technicalpapers - CBP Consultantsto Directorate General of Land Transport

8. Jakarta Urban Transport - FeasibilityStudies (20 Volumes) ConsortiumConsultants 1986-89.

9. Road Maintenance Study - Consortium Consultants 1989. SIA Jabotabek Ur Dan Deveiopment Project Organization Structure of inier-Agency Coordinating Team for Urban Dlevelopment (Tim Koordinasi)

Minister for NationalDevelopment Planning/Chairman BAPPENAS

Chairman- Deputy for Economic Inter-Agency Affair BAPPENAS Steering Vice Chairman-2 A* A Committee Members - 9 **

E ExecutiveSecretary Executive Assistant Executive Secretariat Secretaries - 4

WorkingGroup 1 W WorkingGroup11. Group Working IVan UrbanDevelopment ProgramA WorkingGroup 1ic Institutionaland Poliies & Programs mplementationA Fnanci esources Manpower Deveopment F~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

aDrcoGeoal plclaLit Wrtorkina ona u Auno ryofoeullAfar - emr

5Vice3. Dieco Chairman GenraI - DirectorofR dGewaDeeopetMointarry I ofnanof of Hom Afar_-MFce-ece Iiisr e Vice Chairman n - Deputy Socia & Cultural Affairs. BAPPENAS **t Deputy Regional Development. BAPPEMAS - MINIber 2- Director General of PubhlcAdministration and Regional Autonomy. MWNstryof Horne Affars - MSembor 3. Director G3eneral of Reg'ioa Development, Ministry of Home Atfalrs - Mibr 4. SecretaryGeneral of the Minnstryof Public Works - Member 5. Director oeneral of the Budget, Minis ry of Finance - Me9mber S. Director Generalof HumanSettlements. Ministry of Public Works - Member 7 Director Generalof Highways.Mhstry of Public Works - Menmber S. Director Generalof Land Transport. Ministry of Communications - Menber *** IncludingUrban Transport WorkingGroup. I cAW441I la INDONESIA Jabotabek Urban Devlopment Project Jabotabok Integrated Programming Operations Structure

Tim Koordinasi

Sector I Sector Agencies Agencies

j +DK-J[atBKSP ~~~I _IJabotabek I I

Staff

BAPPEKOTkIl BAPPEDATkl BIR02 TkI_ BAPPEDOTkl DNAS2 Tkil BIR02/DINASzTkl

CakAw411tI lb INDONESIA Jabotabek Urban Development Prolect Organization Structure for Project Implemntation

Tim Koordinasi

DG OG cipta DG BSia i DKI DG Land Jakarta Bangd Kary Transport Marga

Directore Dector,te. .Directorate Urban |im Directotats DUvropan Shivm Urban Roads D_eopnt Program Planning (Dir PJK)

LLAJRt Directorate *DINAS Directorate BPEADNSU Tinftic £ Transportation Urban Trans- Works) Tasot & Traffie port & Traffic I(Pubic (LLAJR) (LLAK)

t ct

Coordhnation l-~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~- Offie (JttPCO)

PPD/DAMRI Bus Cornpauii

Project Project Project Proloct Project Project Project Project ° t Mana Manager: Manage: L anager | -Manager Managers: DG~Thil -OI-K/OI Director -Traffic 8a TraffI ch T Law Transport Assistance Technical Physical Polutlon Components Management Assestance C*As, Study Studes -DGBUM& Assistance I1uV SATLANTAS -Construction Components -PPD/DAMRI II emorw. Assistance Training 111ISupvis S ud | -LLAK -DGM Assistanc| Assistance Physical I -Training Comnponents

Legnd - -- Monitoring and coordination C'41 tIC - - - Reporting - 1)0 _ Chart 4

' StS-XA~~~~...... E} I-jI

I I t.j1~~3:

Xi - 131 - Chart 5 INDONESIA Jabotabok Urban Development Project Organization Structure of DKI-DINAS LLAJR Chief of DINAS Dep.Chief of DINAS(Traffic) Dep Chief of DINAS(Trannport)

_ _ I _ l _~~ I BAGIAe BAGIAN: e ;AGIA Porsonnol Accounts Adinstrton

SIuD-DINAS: SLA SU-DNASS SUB-DlNAS:. SU-DINAS Programming Trat Eng%&Tranr- Public Transport Bus Licensinga Taxi & Froight _& Monit"ton _part Pkn"& Designl _Planning a Momit. _ uakss V*nce _Licning a B G.

Data a Area Traffi Survey & City Reerh~1Taxis DocumentationDocumentation ~~ControlArea I Reh 1us$ I

Route CityOte Programming Area H Schoduding Bue Ilsma

Monitoring Ara Tariff Intercity Freight & Evaluation Section Buses Transport

Transport Transport PubTacnotBusiness Business | Plannhng Planning Operansport Guidance Guidance

UNIT:Traffic 1 UNIT; UNIT (UIT Eng. Operation ITransport 1 Terrinal Vehicles S Maintenance J Services L_Trrminals_ T Testing

Area Traffic General General General Control Affairs Affairs Airs

Trdffic l l Weigh Terminal& Mechanical Si81gnals 4 Bridges Shelter Plan. & Equipment

Traffic Signs Tow*Trucks TermnaV PULO =&MMar kSings oTationscMENTENGlS

Other Traffic Driving Maintenance UMNTENGVTS Functions SchoolsENVT

Revenue SUKUDINAS Coloction T 3

Traff A Public _ubkc Engineering Adiitain Transport VTS 6

cak\w41t t 1 NOTES MAP SECTION Lr¶A.LANU |- --POVE -OUMQAS )BW _ BTN&SIONAK I OUNDAS\.S MALAYSIA .IA0OTABEK URI5A LOIMlI 1,~~~ , , -'","Y)HSRRk;A

X- > V,J \,_ > ; _ . . AIRP ._ _> ~~~~~~~SEA ~ ~ ~~JAVA N KALWAITA

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FEGOOINGBAUNEGBOUNDWATUR RE OR SOiL UNSUITA-LE SECONRYURES

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AF M AN A Y S CHEME F ,,l POSIVERSR UIT A FOR4BLE VELOPMURBAN ENTDEVE OPM TT _ EHYSICAL CONSTRAINTSGOOD DRAINAGEZONEFRESH GROUNDWATER.POORLOCALCMAINRROADS PU I OSROAINS ZONE GOOD LRYINAGE ES GCO N ASTEL64RFOORY AGSRICULTUES/rjY*-\ RT DK.I.JA B RTAB BOUNDARY ZOANE EV STEEP LO PENT K . A A j DEPO

GOOD DRAINGAG LIANTEDGRO UNDWATERSOI. r n w_ , GOODAGRICULTURE . r IA, ZONE V LOWNTAINS PLANSRIER'I 106 30 Y 06°45 NATURAL FORESTAREASLIROITEDAGRICULTURE T05 FERI