January 7, 2010 / 3:17 AM / 10 years ago

Indonesia says UAE fund plans to invest $5.2 bln

JAKARTA, Jan 7 (Reuters) - The UAE’s Middle East Coal (MEC) plans to invest $5.2 billion in infrastructure in Indonesia’s East Kalimantan including a power plant, a railway and a smelter, the head of Indonesia’s investment agency (BKPM) said.

The projects in the province on Borneo island include an around 140-km railway, a 1,400 megawatt coal-fired power plant and an alumina smelter, Gita Wirjawan said late on Wednesday.

Wirjawan confirmed the plans in a mobile phone text message to Reuters, adding: “as for the railway project, the land clearing has been done in the past months and the first stone will be laid in March.”

MEC from the emirate of Ras Al Khaimah is a joint venture between UAE investment fund RAK Minerals and Metals Investments (RMMI) and UAE-based mining company Trimex.

Wirjawan said that the projects were expected to be completed within the next 3-4 years as investors had received financing commitments from Middle East banks and had the technology needed for the projects.

Resources-rich East Kalimantan has big reserves of coal and other minerals.

Indonesia, the world’s most populous Muslim nation, has been keen to attract more foreign investment investment from the Middle East.

The Southeast Asian country expects foreign direct investment to rise 15 percent this year after only reaching just below $10 billion last year, according to data from the investment agency.

Reporting by Dicky Kristanto and Andreas Ismar; Editing by Ed Davies

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