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Indonesian ports must stay on track for last mile of rail links

Indonesian ports must stay on track for last mile of rail links
Although there has been encouraging news that Indonesia is continuing its push to improve its logistics network with state port operator Pelindo III combining with train operator PT Kereta Api Indonesia's (KAI) reactivating a long-suspended container train service at Surabaya's Tanjung Perak Port, this is just the tip of the iceberg.

The service, to be operated by KAI’s logisitics unit PT Kereta Api Logistik together with Pelindo III's subsidiary, PT Terminal Petikemas Surabaya, will serve the busy Surabaya-Jakarta route with a twice daily service and looks good on paper. It is slated to initially connect the port with the nearby Petikemas Surabaya train station and will run with 15 to 30 cars and have an estimated annual capacity of 43,800 teu.

The key objective of building up the freight rail network is to ease the pressure on the land transportation network which is predominantly truck-based currently. Traffic congestion and other infrastructure issues mean the trucks get held up and boxes are not being moved out of the port fast enough and leads to higher dwelling times and port congestion.

The government is certainly making an effort to improve the situation. The Jakarta-Surabaya double track railway programme begun in 2011 under the previous administration is progressing and the northern sector is completed while the southern Java line is set to be fully operational in 2017. The IDR10trn ($773m) northern Java corridor line is forecast to be able to run 200 trains a day and more than double freight capacity to 6,000 teu per week.

The key however is how this new rail infrastructure will connect to the ports. The transportation ministry is reportedly planning to reopen inactive railroads facilitate this. These include the 45 km track from Cianjur to Padalarang (West Java), the 33 km track from Surakarta to Wonogiri (Central Java), the 30 km track from Kedungjati to Tuntang (Central Java) and the nine km track from Jakarta Kota to Tanjung Priok.

There are challenges however. Land issues, the perpetual bugbear, are a major problem. For example, in Jakarta, the effort to connect the railway line with the Port of Tanjung Priok has been delayed by land acquisition problems, especially due to the Mbah Priok graveyard being in the way.

Efforts are underway to build a railway line from Cikarang to Jakarta’s new port of Kalibaru, but in Cirebon, near where the canned Cilamaya port project may relocate to, reactivation of the existing line has met resistance from local government has objected to this

Other problems related to reopening of these tracks is that some have been covered over or are too close to residential areas. 

But perhaps the biggest issue is the mindset and system that has been built up around using trucks to get containers out of the port. Despite the fact that sea transportation is 30% to 40% cheaper for transportation within Java, flexibility and lead time still cause shippers to prefer using trucks. These same factors are exacerbated on the rail network and result in a freight usage rate of only about 30%.

With port volumes in Indonesia rising rapidly however, a solution needs to be found quickly. Container volume at Tanjung Perak Port has reached 3.1m teu with an expected 10% growth rate this year while the main Tanjung Priok port in Jakarta has long outstripped capacity and is in limbo while waiting for the new Kalibaru port to be completed and boost capacity.

Dwelling time at Tanjung Perak is currently five days while at Tanjung Priok it averages a little over six days. Industry players see limited transportation options and heavy reliance on trucks as a major contributory factor.

However unless the last mile rail connections to the ports and major industrial centres continues apace, it seems unlikely the situation will improve much and the efforts being put into building up the mainline rail linkages will come to nought.