No compensations costs involved in latest deferment of HSR project, says Azmin

KUALA LUMPUR (June 17): There are no compensation costs involved in the latest deferment of the multi-billion ringgit highspeed rail (HSR) project agreed upon by Malaysia and Singapore on May 31, said Senior Minister for Economy Datuk Seri Azmin Ali.

Azmin, who lead the Malaysian team in the discussions between the two countries, said the decision to suspend the Kuala Lumpur-Singapore HSR project for the second time to Dec 31 was a mutual agreement between both sides.

“No [compensation]. It was mutually agreed,” he told reporters at a Ministry of International Trade and Industry (MITI) event  today.

When announcing the suspension in May, Azmin, who also serves as the MITI minister, had said both the Malaysian and Singaporean governments have agreed to resume discussions on the project “in the near future”.

“The discussions will encompass some of the proposed changes in the commercial and technical aspects of the project,” he said in a statement.

In a separate statement, Singapore’s transport ministry said it had agreed to a “final extension” and that it looked forward to receiving Malaysia’s formal proposal on the changes soon.

In September 2018, Singapore and Malaysia agreed to postpone the construction of the HSR project until May 31 on Putrajaya’s request. Due to this, Malaysia had to pay Singapore S$15 million (RM46.08 million) for costs incurred in suspending the project.

The estimated cost for the construction of the HSR project, which was first announced by both nations in 2013, was last quoted to be around RM60 billion compared with the original price tag of RM110 billion.

According to Azmin, each delay in the project will result in cost increment taking into account a higher inflation rate and a few other factors. Hence, he said Malaysia is committed to ensuring that the construction of the project will start within the newly-agreed timeframe.

“The HSR technical teams of both countries are set to meet after Raya (Aidiladha). When we deferred the project in 2018, it was to relook at the costing of the project, new alignment, design and whatnot. We have agreed to continue the project and we need time to discuss the detail,” he said.

The second extension of the project requested by Malaysia was decided in view of the Covid-19 pandemic which saw economic activities halted due to movement curbs to prevent the spread of the deadly viral disease.

Earlier, Singapore’s Transport Minister Khaw Boon Wan had said that the extension should provide sufficient time for Malaysia to clarify its proposal and for both sides to assess the implications of the proposed changes.

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