Telecommunications developer Len Telekomunikasi Indonesia (LTI) has secured a Rp 975 billion (US$73.46 million) syndicated loan to finance the Palapa Ring broadband project’s central package, an official has said.
LTI president director Raden Wahyu Pantja Gelora said the company expected that the central package, which covers areas across Kalimantan, North Maluku and Sulawesi, would be ready to serve people in early of 2018.
“We have finished the financial plan for the central package. Now, we are in the process of obtaining construction permits in the regencies and cities that the project will cover,” he said in a meeting in Jakarta Monday.
LTI, a subsidiary of state-owned electronics maker Len Industri, obtained the loan from the Finance Ministry’s non-bank financial institution Indonesia Infrastructure Finance (IIF), which acts as the syndication coordinator of state-owned lender Bank Negara Indonesia (BNI) and state-owned financing company Sarana Multi Infrastrutur (SMI).
IIF president director Ari Soerono said this type of loan was one way to finance infrastructure projects in Indonesia. He hopes the central package will help Indonesians enjoy faster internet access.
“Faster internet access will be helpful for students to pursue their studies and entrepreneurs to expand their businesses,” he said in the meeting.
The Palapa Ring is the first government-to-business cooperation scheme within the telecommunications sector that will utilize the availability payment method in which private partners receive payments based on the availability of the designed infrastructure at a specified performance level.