ASEAN KEY DESTINATIONS
Govt prepares incentive for water companies
The government has sped up the finalization of a government regulation draft (RPP) on the water supply development system to provide incentives in the coming sixth economic package for investors running business in the sector.
The Economic Coordinating Minister Darmin Nasution organized a meeting to hasten the formulation of the RPP. Trade Minister Thomas Trikasih Lembong, the head of the National Development Planning Board (Bappenas), Sofyan Djalil and all related officials joined the meeting.
“We discussed the water supply development system, the draft and the special economic zone. It is part of the sixth economic package,” said Sofyan Djalil before joining the meeting on Tuesday, as quoted by kompas.com.
Previously, Public Works and Housing Minister Basuki Hadimuljono stated that the draft regulation would be finalized as a transitional regulation while waiting for the latest draft bill on water resources.
On Feb. 2015, the Constitutional Court revoked the 2004 Law on Water Resources. The government must thus refer to the 1974 Law on Irrigation.
Nonetheless, the government needed to help private investors, both local and foreign, participate in water development under certain requirements, Basuki said.
“It is the portion that would be different. Many of us thought that the state’s control would be applied through share-ownership. Actually, it’s one of many other options. According to the economic coordinating minister, it is more important [to control] by regulation. So, we will have a specific regulation,” Basuki said.
The government, he continued, would give priority to state-owned enterprises (BUMN) and local government-owned enterprises (BUMD). Private entities may invest in the sector as long as they operated jointly with local entities.
As for the share portion between private entities and BUMN/BUMD, it will be measured under the Public Works and Housing Ministry for surface water and the Energy and Natural Resources Ministry for ground water.
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