The Penang government said it is scaling down plans to create three islands via sea reclamation on the south of the state to only one island.
Penang Chief Minister Chow Kon Yeow said this is at the urging of Prime Minister Anwar Ibrahim, amid ongoing controversy over the project.
This means the project will be reduced to a single island of 2,300 acres, compared to 4,500 acres across three islands as earlier planned, FMT reported.
Chow (above) told reporters in George Town that this meant only 115 fishermen will be directly affected compared to 496 if three islands were built.
This announcement comes after Anwar said Putrajaya wll foot the bill of the Penang island light rail transit (LRT) project.
The Penang government planned to fund the project through real estate development on the reclaimed island.
Anwar's announcement was seen as a compromise between grouses by community groups and the state government's development plans.
His daughter and former Permatang Pauh MP, Nurul Izzah Anwar, was a vocal supporter of the community resistance.
The Department of Environment had recently approved the project, with 71 conditions.
Meanwhile, Sahabat Alam Malaysia president Meena Rahman said even the creation of one island could cause have negative environmental impact.
Further, she said, there is now no pressing need for the reclamation project since the LRT construction will be funded by Putrajaya.
"(The single island) is still very large and will affect the fishery spawning grounds and the environment.
"Plus, it will involve large volumes of sand for the reclamation from Penang or Perak waters, causing more damage," she said in a statement.
She added that it is incorrect of Chow to claim a smaller number of fishermen will be affected because the project will degrade marine habitat and shrimp migration.
"So it is not only the fishermen in the immediate site but also along the Penang, Kedah and Perak waters," she said.
"So scrap the project. Not scale down!" - Mkini
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