Singapore still incurring costs on HSR as it awaits KL clarification: Khaw

An artist's impression of the Bandar Malaysia station on the KL-Singapore High-Speed Rail line. Malaysia said yesterday that it is open to dusting off the project once its RM1.1 trillion (S$369 billion) debt is eased. PHOTO: EDELMAN

Malaysia says Mahathir will personally handle negotiations on scrapping project

The Singapore Government said yesterday that it is continuing to incur costs on the High-Speed Rail (HSR) project while it awaits clarification from Malaysia regarding its intention to scrap the HSR.

Meanwhile, Malaysia said Prime Minister Mahathir Mohamad will personally handle negotiations with Singapore, and that it is not completely shutting the door on the proposed 350km link.

Transport Minister Khaw Boon Wan, in a statement yesterday, said that Singapore has "requested the Malaysian government through diplomatic channels to clarify Malaysia's position on the project".

The Republic has also informed Malaysia that Singapore "is con-tinuing to incur costs", he said, but did not elaborate on what these costs involve.

Several contracts have been awarded for the HSR project.

For example, in February last year, the Land Transport Authority awarded a $24.6 million contract to Aecom Singapore to conduct an advanced engineering study for the Singapore stretch of the HSR link.

Mr Khaw said yesterday, should Malaysia cancel the project, Singapore will study the implications and exercise its rights - including any right to compensation for expenses - in accordance with the terms of a bilateral agreement signed in 2016.

"Singapore continues to support the HSR project and to fulfil all its obligations under the agreement," added Mr Khaw, who is also Coordinating Minister for Infrastructure.

He said that when Malaysia proposed the HSR project to Singapore in 2013, the Republic agreed because it was convinced of the benefits to Singapore.

"We still believe that a high-speed rail link between Singapore and Kuala Lumpur would be in our mutual interest, economically as well as in terms of the friendship and mutual understanding of our two peoples," Mr Khaw noted.

The rail link was expected to cut travel time between the two cities from four hours by car currently to 90 minutes when completed in 2026.

The line was to have eight stations: the Jurong East station in Singapore, and on the Malaysian side, Bandar Malaysia, Sepang-Putrajaya, Seremban, Melaka, Muar, Batu Pahat and Iskandar Puteri stations.

Malaysia said yesterday that it is open to dusting off the HSR project once its RM1.1 trillion (S$369 billion) in debt is eased and at "terms which are favourable to us".

Finance Minister Lim Guan Eng said that "we just cannot afford" the current cost of the HSR , which the new Malaysian administration said has a RM110 billion price tag.

"Terminating for now doesn't mean it cannot be revisited in the future," he said in a briefing with foreign media.

"We understand the sensitivity that cancelling these projects has caused to neighbouring countries, but this is a choice we are compelled to make in order to restructure our debts to make sure we do not mortgage the future of our children."

The Malaysian government revealed last week that its total liabilities were now RM1.1 trillion, far higher than the RM686 billion claimed by the ousted Najib Razak administration.

"We may revisit it, but of course, we want to ensure the financial architecture of this project is fair to Malaysia, and of course, we want to strike the best deal," Mr Lim said.

He said Tun Dr Mahathir would be personally handling "the necessary negotiations with Singapore" because of "the traditional close relations" and the Prime Minister's "close ties with Singapore leaders".

He added that the RM110 billion price tag for the HSR was a "conservative" figure as the cost of RM72 billion estimated by the previous government did not include the interest component.

A version of this article appeared in the print edition of The Straits Times on June 02, 2018, with the headline 'S'pore still incurring costs on HSR as it awaits KL clarification: Khaw'. Print Edition | Subscribe