Singapore and Malaysia have agreed to build a high speed rail link between Kuala Lumpur and Singapore by 2020, in a move that both heads of government called a "game-changer".

Announcing the breakthrough agreement at a press conference today following bilateral talks, Prime Minister Lee Hsien Loong said that the rail link would create a 90 minute door to door journey for commuters, and that it will "change the way we do business, the way we look at each other and interact."

He pointed to the Eurostar link between Paris and London, which transformed "two European cities into one virtual urban community" as a model for the KL-SG link.

Malaysian PM Najib Razak said that the project will be a private-public one, with the link being built by private contractors with government infrastructural support. He declined to estimate how much the project will cost.

PM Lee said that Mr Najib had suggested the rail link to him a few months ago and that he agreed that it was a good idea. While the details are not yet finalised, they agreed that this Leaders' Retreat would be a good time to announce the plan.

Asked how the upcoming Malaysian polls, in which Mr Najib's ruling BN is expected to face a tough fight, would affect this plan and others that the two leaders have made, PM Najib said that these are "long term plans" that require "continuity and stability."

"It's quite obvious what I mean," he said with a smile.

PM Lee added with a laugh: "We would like continuity and stability too."

The two leaders will visit two iconic joint venture projects this afternoon, one in Marina Bay and the other in Iskandar.