The Sadai Industrial Estate (KISS) – a IDR6.23 trillion project by the Investment Coordinating Board (BKPM) in 2021 – is awaiting development on its 3,086 hectares (ha) area in South Bangka regency.
South Bangka regency, with its capital in Toboali, is part of the Bangka Belitung province in Indonesia. The regency recorded an area of 3,607.08 square kilometers (sqm) and a population of 198,189 in 2020. Bangka Belitung itself is an archipelagic province, close to neighboring country of Singapore. Out of 470 islands in the province, only 50 of them have inhabitants. The province has an area of 16,424sqm and it boasts 15 investments. Its infrastructure consists of two industrial centers, two airports, 26 ports, 25 educational facilities, 103 hotels and 23 hospitals.
The BKPM is a government agency in charge of implementing policy and service coordination in the investment sector. Founded in 1973, the agency has been led by Investment Minister Bahlil Lahadalia since 2021.
Opportunities for industrial sector
The Sadai Industrial Estate project began in 2021. The project investment is worth IDR6.23 trillion with an interest rate of return (IRR) of 8.73%, a net present value (NPV) of IDR543.22 billion and a payback period of 3.7 years.
The land boasts 3,086ha in size in South Bangka for the industrial area of Sadai and its surroundings. Until now, PT Ration Bangka Abadi (RBA) is managing the industrial estate. The company has built on a 176ha plot of land. It is ready to receive investors to establish its business and manage the land.
The land is also adjacent to the access point to the sea, which would make it easier for export and import activities and the flow of goods. Its strategic location would make a lucrative business investment.
Harianto, a member of the South Bangka Regional Legislative Council (DPRD) of the Golkar Party, said there were currently two from 11 tenants running their business in Sadai. He urged the management of Sadai to speed up the development of the industrial estate.
“The government has supported the development of Sadai’s facilities and infrastructure,” he said, as quoted by bangkaterkini.id on August 15, 2022.
The tenants currently operating in Sadai are PT Sentosa Jaya Purnama, a biomass powerplant with a capacity of 12.5MW (megaWatts), and the Bangka Belitung Environment and Forestry (DLHK) Agency’s waste management division.
Meanwhile, nine other tenants are in the process of operating in Sadai. They are:
- PT Bangka Belitung Sejahtera in the salt factory industry;
- PT Sadai Solder Industry, a joint venture with Sinomach Heavy Equipment Group Co. Ltd., in the tin or solder powder industry;
- PT Sadai Silika Industri, a joint venture with Xinyi Glass Holding Limited, in the silica sand processing industry and glass factory;
- PT Waskita Beton Precast in the precast concrete industry;
- PT Huobi Indonesia in the industrial facilities and blockchain systems;
- PT Nemo Partner Indonesia in the B100 industry;
- PT Sinar Sadai Sejahtera in the fishing industry;
- PT Selatan Bumi Lestari in the pepper plantation industry; and
- Sinomach Heavy Equipment Group Co.Ltd. in the coal fired power plant, storage oil and gas, refinery and petrochemical, raw water reservoirs and clean water treatment and Sadai port development, terminal containers, tin smelter factory and rare earth are also in the planning stage.
Furthermore, Harianto hoped that educational institutions and industrial sectors would cooperate to establish quality manpower in the region.
Challenges for Sadai
However, challenges for the region might still be lurking. Since 2020, there were some problems that the Sadai Industrial Estate faced.
“The existing constraints and obstacles include licensing issues, raw water, gas supply and supporting road access from [the province’s capital] Pangkalpinang,” RBA Director Sri Mempuni said on September 3, 2020, as quoted by Antara news agency.
Bangka Belitung Development Planning Board (Bappeda) chairman, Fery Insani, said RBA should guarantee that the distance of the supply of raw materials, such as tin and pepper, and the KISS did not exceed two kilometers.
However, there have been conflicts since 2020 with the people living around the KIS especially on land dispute. Tukak Sadai district residents and RBA have been having a dispute on a 84ha plot of land that needs to be acquired by the latter.