COMMITMENTS continued Capital Expenditures continued

PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued DECEMBER 31, 2004 AND 2005, AND FOR YEARS ENDED DECEMBER 31, 2004 AND 2005 Figures in tables are presented in millions of Rupiah, unless otherwise stated - 124

50. COMMITMENTS continued

b. Agreements on Derivative Transactions Telkomsel is exposed to market risks, primarily changes in foreign exchange rates, and uses derivative instruments in hedging such risk. None of the derivative transactions entered into by Telkomsel during 2004 and 2005 met the PSAK 55 criteria for hedge accounting. Therefore, changes in the fair value of the derivative financial instruments were recognized in the consolidated statements of income. Telkomsel purchases equipment from several overseas suppliers and, as a result, is exposed to fluctuations in foreign currency exchange rates. In 2004 and 2005, Telkomsel entered into forward foreign exchange contracts with Deutsche Bank, Standard Chartered Bank, The Hongkong and Shanghai Banking Corporation and Citibank Jakarta to mitigate the foreign exchange risks relating to its purchases. The primary purpose of Telkomsel’s foreign currency hedging activities is to protect against the volatility associated with foreign currency purchases of equipment and other assets in the normal course of business. The following table presents the aggregate notional amounts of Telkomsel’s foreign exchange forwards entered into in 2004 and 2005: 2005 Citibank - U.S. Dollar The Hongkong and Shanghai Banking Corporation - Euro Deutsche Bank - U.S. Dollar Standard Chartered Bank - Euro 15 - 2004 15 - in millions in millions - 30 25 30 As of December 31, 2004, all of the forward contracts with Standard Chartered Bank and Citibank had been closed and the outstanding contract with Deutsche Bank amounted to US5 million. A receivable to reflect the gain on the difference between the contract rate and the rate prevailing as of December 31, 2004 amounting to Rp1,020 million was included in “Other Receivables” in the consolidated balance sheet. As of December 31, 2005, all of the forward contracts had been closed. PERUSAHAAN PERSEROAN PERSERO P.T. TELEKOMUNIKASI INDONESIA Tbk AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued DECEMBER 31, 2004 AND 2005, AND FOR YEARS ENDED DECEMBER 31, 2004 AND 2005 Figures in tables are presented in millions of Rupiah, unless otherwise stated - 125

50. COMMITMENTS continued