Investigation of An Operation and Maintenance Framework in the Railway Industry: A Case Study of the Makassar?Parepare

Abstract

Railways play a significant role in daily life, offering speed, safety and massive capacity for delivering people from one place to another. However, developing countries such as Indonesia are currently encountering problems related to Operation and Maintenance (OM) contracts. Railway operators are mostly experiencing a negative rate of return when operations depend only on farebox revenue. Thus, an alternative approach that includes government involvement should be instigated to improve project performance. This research aims to evaluate the contract agreement between the state, in the form of the Ministry of Transportation, and business entities in the operation and maintenance phase. The Makassar-Parepare railway section on Sulawesi Island is used as a case study. The study uses a combination of qualitative and quantitative approaches that follow three stages: assessing the initial design; generating an alternative OM scheme; and propose a suitable OM scheme. The results indicate five components that should be considered when developing an OM contract, namely the tariff, risk, feasibility, subsidy and period of the contract. The study recommends a five-year contract for operation and maintenance, and the government should assign a business entity to manage available assets in the project.

Land Value Capture Modeling in Commercial and Office Areas using a Big Data Approach

“…Various types of infrastructure are included in the government's long-term projects to create investments and equitable development in Indonesia, increasing demand on the state budget. Infrastructure development recently intensified by the government has been in the rail-based public transportation sector (Berawi et al, 2018a;Rahman et al, 2018). The existing modes of rail transportation in Indonesia are still quite limited, so to expand the network, Mass Rapid Transit (MRT) and Light Rail Transit (LRT) systems have been designed.…”

Systematic Review of Value Engineering Research Studies In Indonesia

“…This paper adopts two stages of approach to evaluate the manuscript published in journals and proceedings published in Scopus. Firstly, some keywords and exclusions are conducted to reach research objectives (Mohd Ali Berawi, Ibrahim, ., & Miraj, 2019;Rahman et al, 2018). Keywords should be either value engineering or value management but not earned value management.…”

Exploring Public–Private Partnership Scheme in Operation and Maintenance Stage of Railway Project

“…Some countries, such as in the western part of Europe and Japan, heavily depend on a market based on private investment [28,29]. While in some others, mainly from developing countries such as Indonesia, the railway is part of public interest, thus should be managed by the government or representation of the state [30,31].…”

“…Little evidence shows railway operators experience a profitable project when non-farebox revenue is not maximized. One of the railway operators in Japan has successfully made a profit from railway service due to its capability to generate more than 30% of income from non-farebox through transit-oriented development, land management and leasing, retail, commercial, and many other sources of revenue [30].…”