PETALING JAYA— Prime Minister Tun Dr Mahathir Mohamad said Malaysia will be scrapping the high-speed rail link between its capital, Kuala Lumpur, and Singapore, which may incur millions in penalty.
Speaking at a press conference after the Parti Pribumi Melayu Bersatu (PPBM) supreme council meeting, Dr Mahathir said the penalty to drop the High-Speed Rail project would cost the new government close to RM500 million.
“I was told it is almost 500 million Ringgit. I am yet to verify (the currency) but I suppose it is Malaysian (Ringgit).
“This is the final decision, but it will take time because we have an agreement with Singapore,” he said.
Dr Mahathir said while the negotiations with Singapore are yet to take place the government had made this decision as the project would not benefit Malaysia.
The PPBM chairman said he has yet to review the agreement that was struck with the southern neighbour under Barisan Nasional’s ruling, but said the Pakatan Harapan government will manage it “at the least cost possible.”
“It is not beneficial and it is going to cost us a huge sum of money. We will make no money at all from this operation it is only a short track.
“Of course we will have to talk to Singapore we don’t know when we will meet with them,” he said.
Earlier today, Dr Mahathir in an interview with Financial Times said the government needs to do away with some unnecessary projects, including the high-speed rail, which would cost Malaysia RM110 billion (US$28 billion) without earning “a single cent.”
The project, valued by analysts at about US$17 billion, is out for tender and is targeted for commercial operations in 2026.
Malaysia and Singapore had in July 2016 signed a Memorandum of Understanding (MoU) on the project.
The 350km rail, was to have eight stations namely Bandar Malaysia, Putrajaya, Seremban, Ayer Keroh, Muar, Batu Pahat, Iskandar Puteri and Singapore, and would reduce travel time between the two countries to just 90 minutes, with speeds of over 300km/hour.
Mahathir had previously said there were high financial penalties for pulling out of the project and Malaysia would try to find out how it could reduce those costs.
He had also said his government was haggling with Chinese partners over the terms of a US$14 billion (RM55.7 billion) rail deal aimed at connecting the South China Sea at the Thai border in the east with the strategic shipping routes of the Straits of Malacca in the west.
He estimated that Malaysia could cut almost a fifth of its $250 billion national debt and liabilities by scrapping such big projects. – malay mail
S’pore not yet officially notified on HSR cancellation
Singapore has yet to receive an official notification from Malaysia on the plan to scrap the Kuala Lumpur-Singapore High-Speed Rail (HSR) project, said the republic’s Ministry of Transport today.
“We had agreed to proceed with the HSR project based on mutual benefits and obligations set out in the HSR bilateral agreement. We will wait for official communication from Malaysia,” the ministry’s spokesperson said in an email reply to Bernama.
Earlier today, Prime Minister Dr Mahathir Mohamad confirmed that Malaysia would drop the project and would potentially have to pay RM500 million in compensation.
“It is a final decision but it will take time because we have an agreement with Singapore. It is not beneficial to Malaysia because it is going to cost us a huge sum of money and we will make no money at all from it because it is a short track,” he said.
Mahathir said Malaysia would discuss the matter with Singapore soon with the aim of handling the project cancellation in a “least-cost manner”.
The 350km HSR project – with the Singapore portion covering 15km – was scheduled to be completed by 2026. — Bernama
MALAY MAIL / BRRNAMA
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