IsDB Supports the Development of the Transport-Sector’s Public-Private Partnerships in Indonesia

The Islamic Development Bank (IsDB) Group has scaled up its presence and support towards Indonesia through a Technical Assistance (TA) facility to Support the Development of Transport PPPs in the Member Country. IsDB would be providing a grant to the Ministry of Transport
(MoT), which will be utilized to build the capacity of the MOT in its efforts to develop and to implement transport sector PPP projects.
The scope of this assistance will consist of activities related to (i) capacity development of MOT; (ii) preparation of a toolkit/guidelines for PPP project screening and selection; and (iii) preparation of an Outline Business Case (pre-feasibility) for one PPP transport project.

The Islamic Development Bank (IsDB) Group has scaled up its presence and support towards Indonesia through a Technical Assistance (TA) facility to Support the Development of Transport PPPs in the Member Country. IsDB would be providing a grant in an amount of US$ 265,000 to the Ministry of Transport (MoT) as part of a larger program, which will be utilized to build the capacity of the MOT in its efforts to develop and to implement transport sector PPP projects. The scope of this assistance will consist of activities related to (i) capacity development of MOT; (ii) preparation of a toolkit/guidelines for PPP project screening and selection; and (iii) preparation of an Outline Business Case (pre-feasibility) for one PPP transport project.

According to Mr. Ibrahim Shoukry, Head of the IsDB Regional Hub Indonesia, “The transportation sector is one of the chief interests of the Government. In the last five years, the Government has increased the political and financial commitment to address the transport infrastructure development programs. These efforts resulted in the delivery of various transport priority infrastructure projects. However, Indonesia’s geography presents unique challenges, which require the government to use an innovative approach in addressing the challenges. The role of PPP is critical in accelerating the transport sector delivery. Therefore, IsDB’s assistance shall support in building the right technical capacity within the MOT and in turn pave the way to successfully execute quality infrastructure projects.”

Mr. Djoko Sasono, Secretary General, Ministry of Transportation Indonesia, stated, “Indonesia needs to address the distinctive challenges of infrastructure, where the transport sector development will form the backbone of its economic growth and development. Private sector participation is a significant contributing factor in the acceleration of infrastructure delivery and with a much better value. The cooperation between the Ministry and IsDB is expected to facilitate and further support the implementation of PPP programs in the transport sector.”

The IsDB and MOT will coordinate closely with the PPP Joint Office, including the Ministry of National Development Planning (BAPPENAS), Ministry of Finance (MOF), Investment Coordinating Board (BKPM), Indonesia Infrastructure Guarantee (IIGF), and others, to ensure the successful implementation of the TA and the continuation of taking potential PPP projects to the market