Indonesian Railways Studies New Rail Lines in Bali, Sumatra, Kalimantan

Indonesian Railways (KAI) has announced it is preparing new rail line development in three regions—Sumatra, Kalimantan, and Bali—following directives from President Prabowo Subianto. KAI President Director Bobby Rasyidin said the company is drafting a development study for the Kalimantan line, while detailed engineering design (DED) work for the Sumatra line is already underway.

For Bali, KAI is still awaiting confirmation of priority status, with the order of construction to be determined partly by land acquisition readiness in each region. Areas with the most advanced land clearance will be prioritized for construction, though no specific timeline for Bali has been announced.

The announcement comes amid a challenging fiscal environment. Indonesia's 2026 state budget recorded a deficit of Rp240.1 trillion as of March, equivalent to 0.93% of GDP, with revenue of Rp574.9 trillion falling well short of Rp815 trillion in spending. A negative primary balance of Rp95.8 trillion suggests that much of the new borrowing is being used to service interest on existing debt.

While KAI has not yet discussed investor involvement for the Kalimantan or Bali lines, Transportation Minister Dudy Purwagandhi said the government has been exploring potential investors both domestic and foreign, including from China and Russia. The scale of investment has not been finalized and will depend on business plans and investor interest.