KUALA LUMPUR: Prime Minister Mahathir Mohamad sent shock waves when he announced in May that Malaysia will scrap the Kuala Lumpur-Singapore high-speed rail (HSR) project on account of its high cost.

Its purported price tag is simply too expensive for Malaysia, he said.

While official figures of the project’s expected costs from MyHSR Corp, the Malaysia Government’s project delivery vehicle for the HSR have not been revealed, a price tag of RM70 billion to RM110 billion (S$24 billion to S$37 billion) has been widely cited.

SHOCK WAVES

Few expected that the project would unravel and in such a rapid manner.

Just two days before Malaysia’s historic general election – a stunning loss for Najib Razak and the 60-year-old Barisan Nasional regime – Singapore’s Land Transport Authority (LTA) had issued tenders for the design and construction of its HSR terminus.

On Apr 5, two days before the dissolution of the Malaysina Parliament, MyHSR Corp awarded its northern alignment (from Kuala Lumpur to Johor) to Malaysian consortium Gamuda-Malaysian Resources Corporation consortium while its southern portion to another Malaysian consortium Syarikat Pembenaan Yeoh Tiong Lay-TH Properties, with package terms to be finalised.

Shelving the HSR project is consistent with the Malaysian government’s approach to review all mega infrastructure projects. Dr Mahathir also announced in May that the Greater Klang Valley rail transit line MRT3 will be cancelled and that the Malaysian government was putting on hold the China backed East Coast Rail Link (ECRL).

FILE PHOTO: Malaysia's Prime Minister Mahathir Mohamad speaks during an interview with Reuters

Malaysia’s Prime Minister Mahathir Mohamad. (File photo: Reuters/Lai Seng Sin)

The market was equally caught by surprise by this slew of announcements. Malaysia public-listed construction and related companies saw their share prices fall.

In a recent interview with the Nikkei Asian Review on Jun 11, Dr Mahathir said…

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