The World Bank Group’s private sector-focused International Finance Corporation (IFC) is offering PT Link Net Tbk (Linknet), a wholesale fixed broadband infrastructure provider in Indonesia, a financing package worth up to $350 million in Indonesian Rupiah to support its nationwide expansion of high-speed broadband infrastructure.
As Linknet expands its fiber network with IFC, more Indonesian homes and businesses will have access to dependable, fast fixed broadband, according to a statement released by IFC on Thursday.
As Indonesia develops its digital economy, the investment is anticipated to open up new economic opportunities by promoting digital inclusion, encouraging innovation, and generating higher-quality jobs.
The financing package includes a $200 million IFC own-account loan, which is IFC’s first investment in Indonesia’s fixed broadband infrastructure sector and demonstrates the company’s dedication to boosting digital connectivity in developing nations.
IFC also served as the transaction’s Mandated Lead Arranger, raising $150 million from the Asian Development Bank (ADB) in addition to its own funding.
All of these funds will help implement high-speed fiber connectivity, especially in underserved secondary and tertiary cities where there is still little access to high-quality broadband connectivity.
“Our partnership with IFC represents a significant step forward in expanding inclusive connectivity across Indonesia, while ensuring sustainability at the core of our growth strategy, a concrete reflection of our purpose, ‘We LINK the nation for better lives’,” said Kanishka Gayan Wickrama, Linknet’s Chief Executive Officer.
“Beyond growth, the financing will also support network upgrades, which will enhance energy efficiency and strengthen the resilience of our infrastructure,” he added.
By continuing to switch from older copper-based hybrid fiber-coaxial (HFC) connections to contemporary fiber networks, the initiative is also anticipated to improve efficiency in the telecommunications sectors.
It should be mentioned that fiber-optic cables are more reliable and generally use less energy when transmitting data than conventional copper-based cables, supporting both digital transformations.
Even though Indonesia’s telecom industry is one of the fastest-growing in Asia-Pacific, the country’s fixed broadband penetration rate is still lower than that of its peers in the region, at about 23% as opposed to the average of about 52%.
Therefore, expanding high-speed fiber broadband is essential to reducing this disparity.
“Expanding access to reliable, high-speed connectivity is essential for unlocking economic opportunities, better jobs, and innovation for Indonesia’s growth,
“By working with Linknet, we are supporting the scale-up of modern broadband infrastructure that helps bridge connectivity gaps and enables businesses to participate in, and grow with, the global digital economy,” said Euan Marshall, IFC’s Country Manager for Indonesia.
