Twelve banks have pumped Rp19.25tn (around US$1.4bn) into a light rail project in Indonesia.

Rp18.1tn will come in the form of a project loan, with the remainder in working capital, with a grace period of 18 years.

The light rail transit (LRT) will connect Jakarta, Bogor, Depok, and Bekasi (collectively known as Jabodebek) and will aim to improve congestion in one of Asia’s biggest and busiest metropolitan sprawls.

The syndicate consists of Bank Mandiri, Bank Negara, Bank Rakyat, Bank Central Asia, CIMB Niaga, PT Sarana Multi Infrastruktur, Bank DKI, Hana Bank, BTMU, Shinhan Bank Indonesia, Bank Sumut and Bank Mega.

It will cost Rp27tn in total and is scheduled to open in 2019. Construction will be completed by PT Adhi Karya Tbk, while it will be operated by Kereta Api Indonesia, which is also adding equity investment. The first stage of the LRT will be 42.1km, with the second adding 41.5km, across six routes. When fully operational, it will have a capacity of 816,000 passengers a day.

This is the second big financing for Indonesia’s LRT network in recent weeks. Early in December, the Greater Jakarta LRT secured Rp29.9tn (around US$2.2bn) from five banks, including Bank Mandiri, Bank Rakyat and Bank Negara. Two unnamed private banks were also involved in the syndicated loan.