Bankruptcy, What’s the Fate of Istaka Karya’s Project? This is the word of the Ministry of SOEs

JAKARTA, KOMPAS.com – PT Istaka Karya (Persero) is a company engaged in the construction sector, owned by a State-Owned Enterprise (BUMN) which is included in the ranks of companies that will be dissolved by the Minister of SOEs, Erick Thohir.

Istaka Karya, which was founded in 1980 or 43 years old to be precise, was previously known as PT ICCI (Indonesian Consortium of Construction Industries), which is a consortium of 18 Indonesian construction companies.

Various government infrastructure projects ranging from office buildings, flyovers to bridges were built by Istaka Karya. But now, Istaka is declared bankrupt, the condition of bankruptcy with decision number 26/Pdt.Sus-Cancellation of Peace/2022/PN Niaga Jkt.Pst Jo.

Then what will happen to these BUMN projects?

Also read: SOE’s Debt Reaches IDR 1,573 Trillion, Erick Thohir: Healthy, because Capital is Bigger

Special Staff to the Minister of SOEs, Arya Sinulingga, said that Istaka Karya’s projects, which are still under work contracts and currently pending, will still await a decision from the court and the curator.

“It all depends on the decision of the court and the curator, so they are the ones who decide about employees and so on. So we are waiting for the decision from the curator,” Arya told Kompas.com, Tuesday (19/7/2022).

The reason for the dissolution of Istaka Karya was because the company was in an unhealthy financial condition and large debts.

There are several Istaka Karya projects that have been in the spotlight, such as the Kampung Melayu-Tanah Abang Flyover, the Papua Bridge, the Cikopo-Palimanan Toll Road to the Yogyakarta International Airport project.

The 2.7-kilometer Kampung Melayu – Tanah Abang Flyover project which started in 2010 was hampered in 2012 due to allegations of misappropriation of funds.

The project was resumed in 2013 and is under the responsibility of the DKI Jakarta Provincial Public Works Agency. Istaka is still taking part in the construction, with support from other construction SOEs, such as PT Nindya Karya (Persero) and PT Wijaya Karya Tbk.

Istaka also worked on the Papua Bridge project from the Ministry of Public Works and Public Housing (PUPR) in 2016. Of the 35 bridges to be built, Istaka holds 14 bridges from Habema to Mugi. However, the project was discontinued in 2018 following the killing of 31 Istaka Karya workers by armed groups.

Istaka is also working on the Cikopo-Palimanan Toll Road project. The project is divided into 6 sections, namely section I, namely Cikopo-Kalijati along 29.12 km, section II, namely Kalijati-Subang along 9.56 km, and section III, namely Subang-Cikedung along 31.37 km. Section IV is Cikedung-Kertajati with a length of 17.66 km, section V which connects Kertajati-Sumberjaya is 14.51 km, and section VI is Sumberjaya-Palimanan with a length of 14.53 km.

Istaka also built the Yogyakarta International Airport project in Kulon Progo, Yogyakarta Special Region to replace Adisutjipto International Airport. The investment for Yogyakarta International Airport is Rp 9 trillion, which is built on an area of ​​600 ha.

Also read: Istaka Karya Is Declared Bankrupt

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