Adani pulls out from South Sumatra railway project
Friday, July 5 2013 - 01:26 AM WIB
India's Adani Group has pulled out from a $1.7 billion coal railway project with Indonesian state coal miner PT Bukit Asam in South Sumatra province due to Indonesia's tough restrictions on licensing, India Times reported Friday.
The delay in the projects has hurt expansion plans from the state coal miner, which owns one of the nation's largest coal deposits at 7.3 billion tons in the province.
Bukit Asam's CEO Milawarma also said that the company was still in ongoing discussions with Indonesia's Rajawali Group to start another $2 billion South Sumatra coal railway project, which has also been delayed for years on licensing and valuation issues.
The setbacks show the difficulty for investors in developing large infrastructure projects in Southeast Asia's biggest economy due to uncertain and overlapping rules, despite government commitments to support development. (*)