India offers $500 Million Soft Loan to Indonesia for its Power Sector

[Chanakya's_Chant]

India offers $500 million loan to Indonesia for its power sector
The two countries emphasised the need to involve youth to strengthen both economic and bilateral ties between India and Indonesia

Ambassador of India, Mr. Gurjit Singh (R) called on Vice-President of Indonesia Mr. Jusuf Kalla on 12 January 2015 (Pic source – Govt. of India)​

Indonesia has accepted a soft loan of $500 million offered by India for investments in Indonesia’s power infrastructure. Gurjit Singh, Ambassador of India, met Jusuf Kalla, Vice-President, Indonesia this week to exchange ideas on socio-economic conditions and for charting development paths where both new governments are engaged.

Indonesia’s Kalla has said that the government will use the loan for funding suitable projects in power infrastructure. According to studies, Indonesia’s power sector is expected to grow by around 7.5% in 2015 and is a focus sector of the government in its plans to improve manufacturing and boost trade.

During the meeting with Indonesia’s Vice-President, Singh reiterated the contribution of Indian companies to the economic development of Indonesia through infrastructure development, manufacturing, mining and employment opportunities created.

Indonesia is a major trading partner of India. In 2013-14, bilateral trade between the countries stood at around $20 billion and investments stood at around $15 billion. Edible oil, mineral fuels, rubber, wood and ships are main imports from Indonesia, while India’s exports to Indonesia mainly comprise oils, rice, cotton, and iron and steel.

However, India runs a huge trade deficit of around $10 billion with Indonesia. In the recent meeting, the two countries have agreed to intensify economic cooperation between the two countries through utilising the improvement in investment procedures being introduced, the speedy redressal of disputes, strengthening of B2B interaction, and participation of companies in trade fairs. The two sides have also agreed to review and implement various MOUs signed between both sides.

Singh and Kalla also stressed on the need to devise new initiatives to involve the younger generation of both countries understand the importance of India-Indonesia economic and bilateral ties.

Singh and Kalla also stressed on the need to devise new initiatives to involve the younger generation of both countries understand the importance of India-Indonesia economic and bilateral ties.

Source:- India offers $500 million loan to Indonesia for its power sector - The Dollar Business

 

[Tresbon]

wan zun

 

[CountStrike]

really good if india join china, japan and south korea to invest in energy project in indonesia.

 

[greatone]

India should cultivate closer relations with Indonesia and their membership in BRICS should be considered.

 

[farhan_9909]

Indonesia is not a small economy anymore and i don't know why will they require 500Million dollars loan

 

[Echo_419]

Indonesia is not a small economy anymore and i don't know why will they require 500Million dollars loan

Indonesia like us is a developing country & will accept investments however small they are from anyone
On topic
Great news & Indonesia should also invest more in India

 

[sree45]

Indonesia is not a small economy anymore and i don't know why will they require 500Million dollars loan

It's for the indonesians to decide. isn't it?

 

[Indos]

The thing that every one should know is that Yusuf Kalla is an Indonesia conglomerate and has various businesses including in energy sector. So there are so many peope get interested in building any electrical power plan in here, including him. India company should join with his company in order to get the project. In term of fund, currently we have huge money after government eliminate oil subsidy and our top banks are state owned as well so the loan should be very very cheap in order to get trough.

 

[Nike]

Indonesia is not a small economy anymore and i don't know why will they require 500Million dollars loan

money is money after all, small sum or large sum they all money in the end

 

[notsuperstitious]

money is money after all, small sum or large sum they all money in the end

He's an expert on economy from Pakistan. He wears custom made glasses.

At topic - good to see India deepening their engagement in the east.

 

[jarves]

Indonesia is not a small economy anymore and i don't know why will they require 500Million dollars loan

It is just like when you give sweets to your new neighbours to get more familiarized with them.

 

[khujliwal]

Indonesia is not a small economy anymore and i don't know why will they require 500Million dollars loan

Because they are not stuck with the ghairat bullshit. Despite being far geographically they are grabbing every opportunity towards progress.

 

[SrNair]

Great.We should increase our relation with Indonesia.Being a major economic power in that region .We should also work for their membership in BRICS.

 

[CountStrike]

Indonesia like us is a developing country & will accept investments however small they are from anyone
On topic
Great news & Indonesia should also invest more in India

that not only about money, but we also need transfer technology from India to invest more power plant with new technology. i think many island in Indonesia like Kalimantan and Sulawesi need more electricity to make new industrial park.

Ambassador's interview with Jakarta Globe

'India finds that when we shake Indonesian hands, we have a firm handshake,” he said. “That is coming from a very long heritage of good relations, which are now becoming a very successful partnerships.'

In March this year, some 72 companies representing a broad swath of the Indian economy participated in the India Show in Jakarta as part of a new push to add dynamism to relations between Asia’s two largest democracies. The show was an unqualified success and heralded a new age in relations between the two nations. On the agenda were issues such as accelerating trade and investment and enhancing people-to-people ties so as to bring the countries closer together.

Indonesia and India have much in common. Both are large nations with diverse cultures and fast expanding economies. Both also share similar challenges to upgrade infrastructure and deal with rising urbanization. The two countries are also members of the G-20. But as Gurjit Singh, India’s new ambassador to Indonesia, noted in an interview with the Jakarta Globe, both sides could do more to forge a new partnership that would elevate both nations on the world stage.

“Recently we put out a YouTube video from the embassy with the title ‘Old Heritage, New Partnership,’ ” he said. “We have an age-old partnership, good political engagement and an established framework of cooperation, but the idea is how do we maximize this for mutual benefit?”

He added that the fact that Indonesia is a democracy, a market economy and is doing well in the world gives it the character of a bigger opportunity for developing a partnership.

“India today wants to develop this partnership and make it more dynamic and diverse,” he said. “In that there is no limitation in any area.”

The two sides already have frequent diplomatic and political exchanges but Singh aims to boost economic ties as one of his top priorities. He wants to make India a partner of choice for Indonesia, so it is not just what India wants but also what Indonesia needs, which will contribute to a successful partnership.

“In our mind, an expanded economic engagement is high on the priority list,” he said. “This does not only include trade but investment, participation in infrastructure development, developing Indonesia’s natural resources with value additions for the development of the whole country itself.”


Although trade between the two countries has been growing at a steady pace — it is well on the way to achieving a target of $25 billion by 2015 — investments have not kept pace.

“I would be much happier if I had $25 billion of investment but I think trade will grow by itself,” Singh said. “We already have large Indian investments in Indonesia, which are in excess of $10 billion, and I think this will grow rapidly.”

This is one area he is taking a personal interest in because he believes that bringing in investments leads to far more substantive cooperation and benefits than just boosting trade. For this reason, he wants to encourage Indian industrialists to build power plants, steel plants and smelters for processing minerals, as well as putting up manufacturing plants.

“We are confident that Indian FDIs will become an important player in Indonesia,” he said. “We are also looking at the various economic corridors to see if we can aggregate something by putting in greater diversity, which will also help in diversifying more Indonesian exports away from commodities.”

There is, therefore, a shifting of gears from having large trade to having large investments. The career diplomat, who has had postings in Africa, Japan and Italy, has been pleasantly surprised by Jakarta’s modern skyline and its metropolitan makeup.

“To be honest, when I first came here, I was a bit surprised at how modern Jakarta was,” he said. “I knew it was modern but perhaps it was beyond my initial expectation so obviously there has been a big boom here.”

He has, therefore, had to reorient his thinking in that he was dealing not just with any country but a country and a people in full bloom. “When you are blooming, there are many bees hovering around the flower, so the challenge for me would be how I am not just one bee and I need to make a hive.” He has also been impressed with the vibrancy of the local press, which he said is critical to his understanding the country. “You see fairly open debate on many issues, cogent editorials and open-minded op-ed pages,” he said. “This level of open-minded debate and discussion helps my understanding of this country.”

The other big surprise for him was discovering how young Indonesia’s population is and in this regard it is very much like India. More than 30 percent of Indonesians are under 35 years of age, a fact that changes the dynamics of engagement and offers huge opportunities for foreign and domestic investors.

Given the country’s youthful population, Singh said he hoped to visit universities across the country to engage directly with the youth and to look for opportunities to form deeper cooperation with Indian universities.

“I want to reach out to the people of Indonesia at all levels,” he said. With so much diplomatic and economic activity between the two countries, he added, it is a good time for an Indian ambassador to be posted to Indonesia.

“India finds that when we shake Indonesian hands, we have a firm handshake,” he said. “That is coming from a very long heritage of good relations, which are now becoming a very successful partnerships.”