Most mega-project infrastructure such as highway construction requires an enormous amount of cost. This situation might be a problem to developing countries that have limited national budget plan. On the other hand, the capability to transfer the funding of infrastructure depends on the project attractiveness to the private sector. The evaluation to involve in the project should be supported by a significant value for money from the business perspective. Optimum feasibility plays a vital role in bridging the partnership between the government and private interests. The study uses a case study of highway project development of Trans-Sumatera highway road (TSHR) that spans about 2700 km to elaborate on how project feasibility can be improved through creative method. Value engineering (VE) approach as a systematic way to generate innovative ideas by combining multidiscipline backgrounds perspective is used. The study shows that additional functions for the project include integration with motorbike toll road, dry port, and railway line; others also include tourism, fiber optic, and service area development. The innovative ideas have contributed to the significant increase in the internal rate of return (IRR) to the project from 7.79 to 12.76%. The study also formulates institutional scheme through build operate sharing transfer (BOST) which administers government’s role in the project development.
Part of the book: Highway Engineering
Infrastructure plays a significant role in increasing economic development by providing access of transportation and improving connectivity. High-speed train (HST), one of mega infrastructure projects, has a positive impact on economic development of a nation. However, the project feasibility requires the maximum value for money and an acceptable risk to attract private investors. This study aims to improve the feasibility of the project by producing a conceptual design of Jakarta-Surabaya high-speed train in Indonesia. Value engineering will be used to evaluate both technical and financial aspects of the project. The methodology uses both qualitative and quantitative approaches through a case study, in-depth interviews, and life-cycle cost analysis. The result shows an optimum route sketching for the project and potential added value to the project. It consists of the solar cell, fiber optic, tourism, and transit-oriented development. The output also generates the division of responsibility between the government and business entity during the project lifecycle regarding the project financing. The institutional scheme will regulate the position and roles for each related stakeholder that was involved in the HST project development.
Part of the book: Modern Railway Engineering