This document discusses Indonesia's railway transport policy environment and plans for reform. It covers: 1) Law 23/2007, which aims to reform the railway sector by opening it to greater private sector participation and competition, and establishing clearer regulations. 2) The goals of reform include improving efficiency, promoting investment, and increasing rail's mode share for both passenger and freight transport. 3) Moving forward, a National Railway Masterplan will guide long-term development, including setting achievable targets for rail market share. Institutional restructuring options are also discussed to separate regulatory and operating functions.

1. The Current Transport Policy Environment (Law 23/2007: Objectives & Follow-up)Harun al-Rasyid LUBIS15 December 2009

2. Legal and Regulatory ReformPast & Recent Law # 23/2007Railway Policy Reforms & Objectives Moving ForwardGoals of Rail Sector DevelopmentRoles & Strategic DirectionsFollow-upInfrastructure Ownerships and Rolling StocksOption of Railway Organization ModelRailway Restructuring VariablesPossible Institutional & Regulatory DevelopmentNational RMP and Indonesia Railway Forum

3. Railway: Legal & Regulatory ReformPASTLaw # 13/1992 GR No. 69/1998 Rail Infrastructure and Rolling StockGR No. 81/1998 Rail Traffic and TransportNEWLaw # 23/2007GR 56 /2009 Railway Operation and Management Draft GR Rail Traffic and Transport

4. Law # 23 /2007 : Policy Reform & ObjectivesToday Future Expectation ( by Law) Local GovermentsOther Corporations Highly depending on public funding

5. Dominantly PT KA Monopoly

6. Too centralistic planned and managed Railwayoperations and managementshouldbeefficient and responsivetothemarket – competitiveservicesHOW ?Article 214 ; Railway Audit and PT KA Betterment ( only 4 months left )Opens up Local Government involvement and private sector participationsa) Institutional and implementing regulations need to be set upb) Infrastructure ownership and management need to be clearly defined , andc) Separation of regulatory function and service providersIf the market allow, introduce competition and network access to new TOCs

7. The objectives of regulation are: to regulate the establishment and provision of railway services in Indonesian;to promote and protect the interests of users of railway services;to promote competition in the provision of railway services;to encourage investment in railway infrastructure and rolling stock by the private sector where appropriate; andto promote efficiency and economy in the provision of railway services.

8. MOVING FORWARD --Goals of Railway Sector DevelopmentNational Railway Masterplan (NRMP) will guide the long term development of the sectorConsolidated and good quality NRMP document is necessaryAchievable targets of railmarket share byregion /corridor / islandsneedtobespecified in NRMP

9. Rail Transport Shares WorldwideCOUNTRY Passenger FreightJapan 29% 5%EU & USA < 10% 10 – 30 %Indonesia 6 – 7 % < 1 %Sumber : diolah dari berbagai sumber

10. Roles and Strategic Directions Rail Advantages: efficient, environment friendly, less energy for a massive and long haul , less land take, etc..

11. Will push other sectors development, backward and forward, such as job opportunities, property, industry, supported distribution and delivery services, etc...

12. Passenger Commuter Trains and Intercity Medium Distant Roles of the railway sector in the national economyRail transport is strategic part of logistic system and supply chain management (SCM)

13. To be more competitive, rail services need to be improved, also as complementary for other modes (land, sea and air transport) so as to form an efficient and seamless transport Roles in Logistic & Distribution

14. FOLLOW-UP :Objects to be managed and regulated Railway infrastructure:Rail trackStationsOther train operating facilities (signal, telecommunication and electricity) Rolling stock (trains):LocomotiveCars (for passengers)Wagons (for freight)Special facilities or rolling stock (for track maintenance-- MTT)Workshops, depots for R/S maintenance

15. Railway Organization ModelSeparated : Multi-OperatorIntegrated Model (a & b)BUS BUS 12BUSn(c)TACB U P & S(a)BUPTACNotes:BUP & S = Infrastructure and train operating company (integrated)BUP = Infrastructure management companyBUS = train operating companyD A = division of transportDP = division of InfrastructureTAC = track access chargeB U P & SBUSn(b)D AnTACD P

16. Railway Restructuring: Variables that needs to be controlledCOMPETITIONSTRUCTUREIntegratedDominant/Tenant/incrementalSeparatedPublic/Mixed/Privt OwnershipIntermodal orIN/FOR MarketTariffsAccess RegimeEntry/LicensingSafetyGovernment SupportREGULATION

18. Organization and OwnershipOWNERSHIP SPECTRUMORGANIZATION STRUCTURE SPECTRUMTrue “separation’’

19. Possible Stages of Institutional and Regulatory Development( Service providers)Past Now14Follow-up Future

20. Key Players on RailwayRailway Law 23/2007 categorizes at least six key parties or players in the rail sector i.e.: Governments (central, province, regency), Business entities or companies as service providers of infrastructures and/or transport services) Research institutes, Universities, Customers, and Societies ( viz. industries)

21. NRMPNational Railway Master Plan & Indonesia Railway ForumRail sector Long term investment Plan(20 years)Strategy & Long term Action PlanRail Improvement Projects ( 4 to 5 years)Yearly Program and Project List ( 1 to 2 years / multi years)MTDPRail BudgetIndonesia Railway ForumParliament and Ministerial Approval

22. Thank you…