ECRL a sweetheart deal for China, says Bersatu strategist

For Bersatu strategist Rais Hussin Mohamed Ariff, the East Coast Rail Link (ECRL) project is nothing but a sweetheart deal for China.

Like former finance minister Daim Zainuddin, Rais does not think that the ECRL project is an investment.

“It is a single track old train system built at the cost of RM55 billion with 3.5 percent interest rate to be paid in 240-month instalments after a seven-year grace period.

“China gets to loan out its huge reserves securely, dump off an old train system, get to sell their trains and its parts including even nuts and bolts and bring their staff,” Rais told Malaysiakini.

The project, he added, will only benefit China, while Malaysians would be saddled with huge debts that are not sustainable.

“Of course this is not an investment but a debt,” said the Bersatu supreme council member.

Daim last week questioned whether China-backed projects were investments or loans. Citing the ECRL project, Daim wondered whether it could be considered as an investment.

The finance ministry in a parliamentary reply had said that the ECRL's cost would remain at RM55 billion, 85 percent of which would be funded via a government-guaranteed soft loan from the China Export-Import (Exim) Bank.

The rest of the cost, meanwhile, will be funded through Islamic bonds or sukuk from local financial institutions.

It had also been reported that the project's cost was expected to increase to between RM60 billion and RM70 billion for double tracking the 688km ECRL line, as well as for the acquisition of land along the route from Port Klang in Selangor to Pengkalan Kubor in Kelantan.

The finance ministry, last month said that the ECRL will only feature a single track arrangement.

The track will, however, be laid on a “double track formation.”- Mkini