MCA may relinquish rail and ports to Umno, says business paper

By Lee Wei Lian

April 07, 2012

KUALA LUMPUR, April 7 — The high financial stakes involved in the massive boom in rail infrastructure in the country could lead to a shift in the country’s political landscape and the carving up of the Transport Ministry, a business weekly reported today.

The amount of money being poured into rail infrastructure, coupled with high-profile scandal-hit projects like Port Klang Free Zone (PKFZ), has sparked a realignment of national politics with the Transport Ministry, which has traditionally been helmed by MCA, potentially leading to the loss of the rail and road sectors, said The Edge.

“There is a lot of national pride attached to the rail sector now and Umno believes it must take the lead,” an unidentified industry source was quoted as saying.

The industry source also said that Minister in the Prime Minister’s Department Datuk Seri Mohamed Nazri Aziz was being considered to oversee the rail and road sectors, leaving the Transport Ministry with ports and airports.

If such a move materialises, it could come as a blow to MCA’s pride, which has seen its prestige dwindle from the early years following independence when it took the lead in high-profile ministries such as finance.

A re-delineation could also further strengthen the perception that politics in Malaysia is too closely tied to business interests.

Prime Minister Datuk Seri Najib Razak had committed himself to reforms including increased transparency and more open tenders but the reported behind-the-scenes lobbying for billion-ringgit contracts and subsequent revamp of portfolios could be a setback to his efforts.

The Edge report said that the prime minister is keen on greater transparency in infrastructure projects but the growing political interest in rail could be a “potential headache” for Najib.

Some entities, which are widely believed to have close ties to Umno, are already perceived to have benefited enormously from rail projects.

These include MMC, a company controlled by media-shy tycoon Tan Sri Syed Mokhtar Al-Bukhary, and its joint venture partner Gamuda, which has won billion-ringgit rail projects in recent years, including the northern rail double-tracking project as well as the tunnelling portion of the Klang Valley MRT.

It is also bidding for the Gemas-JB portion of the rail double-tracking project.

An ongoing trial has given a potential glimpse into the alleged wheeling and dealing that goes on behind the scenes of the country’s rail projects.

The KL High Court was reportedly told on April 4 in a case against the MMC-Gamuda consortium, that names of political leaders were suggested to help revive the northern double-tracking rail project, including current Umno Youth leader Khairy Jamaluddin.

The RM360 million lawsuit against MMC-Gamuda was reportedly filed by Scomi CEO Shah Hakim Zain, Seow Lun How, Newfields Advisors CEO and railway expert Mansur Ghazali after they claimed that they were not awarded a project as promised after helping MMC-Gamuda revive the massive double-tracking project.

Battles were also reportedly waged over the award packages in the ongoing KL LRT extension project.

Apart from the rail double-tracking project, which runs the length of the peninsular, and the Klang Valley MRT, which has been dubbed country’s largest infrastructure project to date, Malaysia is also mulling the construction of a high-speed rail link to Singapore and is now awaiting feedback from the island republic.