SINGAPORE - Singapore and Malaysia have signed an agreement to defer construction of a cross-border MRT link up till Sept 30 this year.
As part of the deal, Malaysia will also reimburse Singapore more than $600,000 - for abortive costs incurred as a result of the six-month suspension of the planned Rapid Transit System (RTS) Link.
Singapore's Transport Minister Khaw Boon Wan and his Malaysian counterpart Anthony Loke inked the agreement to formalise the suspension on Tuesday (May 21) at the PSA Building, where Singapore's Transport Ministry is located.
Speaking at a joint press conference, Mr Khaw said Singapore hopes for the RTS project to resume after the suspension, either in the current form as prescribed in last year's bilateral agreement, or incorporating any changes to the project scope.
"If not, the RTS Link Project will be deemed to have been terminated by Malaysia, and Malaysia will reimburse Singapore for the costs we have incurred in fulfilling our RTS Link obligations till now," said Mr Khaw.
Malaysia will have to pay more than $66 million should it choose to terminate the project.
Mr Khaw said the decision to suspend the RTS Link Project will affect the Land Transport Authority's contractors and bidders involved in the development, as well as SMRT, which is Singapore's Joint Venture partner for the RTS Link operator.
In a joint statement following the signing, the countries said that the transport ministers "recognised the urgent need to alleviate traffic congestion at the Johor Baru- Singapore Causeway which facilitates about 300,000 crossings daily".
Singapore and Malaysia said they will also continue to discuss other "affordable and sustainable solutions to address traffic congestion at the border".
"We will also explore further initiatives, including the use of new technology for enhanced security and checkpoint efficiency," said the two countries.
Asked how much Malaysia was looking to reduce the costs of the project by, Mr Loke said he could not give a number as discussions between the governments and ministries are ongoing and will continue in the next few months.
"We are looking into getting the private sector to be involved in this project as well, so I think this is very much a commercial decision and I do not want to give any figure right now," he added.
"The important thing is that if we are able to reduce the infrastructure cost, that will benefit passengers and the public at large, because it will lower down the fare structure in future," Mr Loke said.
Mr Loke said Malaysia hopes to continue with the RTS project, but "in other forms and in different approaches" so that costs can be reduced.
Mr Khaw, meanwhile, said Singapore is open to proposals from Malaysia but noted that different solutions come with "different price tags and different performance".
The RTS project, Mr Khaw said, is based on Singapore's MRT system and has a capacity of 10,000 commuters at peak period, every hour and in one direction.
"Other options would be cheaper but the carrying capacity would be less," he added.
Malaysia had earlier requested for a six-month suspension of the project from April 1, saying that it needed to review the costs, including how to bring them down further.
The 4km RTS link - which would connect Woodlands North station on Singapore's Thomson-East Coast MRT Line to Bukit Chagar in Johor Baru - was targeted to begin operations by Dec 31, 2024.
Mr Khaw said the suspension would impact this target opening date, and the project would be delayed by a "couple of years" should both sides agree to proceed after September, as per the bilateral agreement.
Mr Loke, however, said it was too early to say when the RTS project could be completed should it resume.
"We will try very hard to make sure we still can meet that deadline, if possible, because there are ways and means to do it. Even though there is some delay right now, I think we can catch up in other aspects," Mr Loke added.
In a Facebook post, Mr Khaw said Singapore agreed to suspend the project in the spirit of bilateral cooperation, and called the move a "temporary setback".
"But I remain optimistic that the project could resume in due course," he wrote. "The cross-border congestion is real and only a decisive project like the RTS can make a material difference to the current situation."