Why is it so hard to push Chinese railway projects in Southeast Asia? The role of domestic politics in Malaysia and Indonesia

Abstract

• Implementation of large Chinese projects overseas is uneven, with the dynamic more complex than often portrayed. • Projects are rolled out more expeditiously in host states with a highly centralized political structure and vice versa. • Malaysia’s power concentration has facilitated elite consensus and quickened the East Coast Rail Link’s rollout. • Indonesia’s implementation of the Jakarta-Bandung High Speed Rail has been checked by multiple influential stakeholders. • This paper’s findings have important implications for future South-South cooperation in railway development. This paper focuses on two of the most prominent Chinese railway projects in Southeast Asia since the 2013 inception of the Belt and Road Initiative (BRI) – Malaysia’s East Coast Rail Link (ECRL) and Indonesia’s Jakarta-Bandung High Speed Rail (HSR). Adding non-economic considerations and political contestation between central state organs into Sinha’s (2005) framework on central-state/province interactions and their impact on economic development, it argues that the implementation of large, capital-intensive BRI projects is more complex than often portrayed. The ECRL is implemented considerably faster than the HSR primarily because, relative to Indonesia, Malaysia possesses a more centralized political structure. Malaysia’s power concentration at two levels – between central and subnational players and amongst central players – has facilitated elite consensus and accelerated the ECRL’s rollout. In contrast, Indonesia’s decentralization exercise since the late 1990s, both at the spatial level and within the executive arm of the central government, has encouraged plurality of opinions and complicated project implementation. Despite President Joko Widodo’s clear intentions to expedite the Jakarta-Bandung HSR, he has been checked by multiple influential stakeholders, resulting in delays. The Indonesians, relative to the Malaysians, appear to have negotiated a somewhat better deal from the Chinese railway consortium. However, these tentative gains are offset by the HSR’s slow implementation, which in turn is undergirded by Indonesia’s fragmented institutional arrangement.