Minimal govt funding for HSR, revival hinges on private participation, says Loke

• Transport Minister Anthony Loke Siew Fook explained that the HSR is fundamentally different from other rail projects, such as Keretapi Tanah Melayu Bhd’s (KTMB) operations, which are fully funded, maintained, and constructed by the government.

SEREMBAN (Jan 20): The previously terminated high-speed rail (HSR) project linking Kuala Lumpur and Singapore can only proceed with full participation from the private sector and minimal government funding, Transport Minister Anthony Loke Siew Fook reiterated on Monday.

The minister explained that the HSR is fundamentally different from other rail projects, such as Keretapi Tanah Melayu Bhd’s (KTMB) operations, which are fully funded, maintained, and constructed by the government.

“The HSR must be a privately funded initiative,” Loke said.

“In contrast, KTMB operates as a government project. The HSR, however, is an entirely different concept. That is why we have decided that any party interested in implementing the HSR must do so through private-sector investment,” Loke said at a press conference after the handover ceremony of the ETS Class 93 train for the maintenance, repair, and overhaul (MRO) project to the Transport Ministry.

The overhaul was conducted by Railtec, a strategic joint venture between Destini Bhd (KL:DESTINI) and KTMB.

Prime Minister Datuk Seri Anwar Ibrahim had emphasised the government’s focus on key issues such as poverty alleviation, basic infrastructure and public health, which has led to the HSR project seeking private-sector participation, instead of being fully government-funded.

Last Friday (Jan 17), Berjaya Corp Bhd’s (KL:BJCORP) founder Tan Sri Vincent Tan reiterated the group’s commitment to participate in the multi-billion dollar HSR project. However, he stressed that the project’s progression depends on the government’s decision-making process and financial considerations.

Tan also urged the government to thoroughly assess the economic feasibility and financial viability of the HSR project before proceeding, given its significant cost. Berjaya Corp is currently seeking a new partner for its HSR bid, following the withdrawal of Malaysian Resources Corp Bhd (KL:MRCB) from the consortium.

The project was first announced in September 2010 by then prime minister Datuk Seri Najib Razak.

The project was suspended in September 2018, after Najib and Barisan Nasional’s ouster in the 14th general election in May that year, before it was terminated in January 2021, after Malaysia and Singapore failed to come to an agreement on the details of the project.

In the process, Malaysia paid north of RM320 million to the Singaporean government for costs incurred by Singapore in preparation for the project, and for the extended suspension.

From a range of RM55 billion to RM70 billion when it was first announced, costs for the approximately 350-kilometre-long railway, which some say could move to and from Kuala Lumpur and Singapore in one hour and a half, is up in the air with some estimates at above RM100 billion, partly due to rising material costs.   

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