IF completed, the Kuala Lumpur–Singapore High-Speed Rail (HSR) line project due to be operational by 2026 would have cut land travel time between the two cities from four hours to a mere 90 minutes.
But now it seems that the prospect could remain a pipe dream after Malaysian Prime Minister Dr Mahathir Mohamad stated his plans to scrap US$17 billion project.
The government, which recently delivered a shock victory in the May 9 elections, is taking austerity measures to address the nation’s debt, which reportedly ballooned to over RM 1 trillion (US$250 billion) while under the previous administration led by ousted Prime Minister Najib Razak.
On Wednesday, Dr. Mahathir Mohamad told a press conference that members of his new Cabinet have agreed to axe the project “subject to discussions” with the Singaporean government as it “carries high financial implications”.
“The most important thing for us now is to reduce the amount of borrowings by the government. We have borrowed too much money.
“So we cannot (be able) to pay so much money if we continue with the project.”
Mahathir said the HSR was not the only muilti-billion dollar project that would likely be cancelled.
“If this country is to avoid bangkrupcy, we must learn how to manage our big debts. So one of the ways is to do away with projects that are not beneficial to the country.”
On the possibility of the Singapore government raising issues about the planned cancellation, Dr. Mahathir said his administration will “listen to them”.
“They are our good partners.”
‘Malaysia can’t afford it’
Political economist, Hoo Ke Ping, told Free Malaysia Today that Malaysia should not undertake the project if it faces difficulty repaying the debts incurred.
Ping said the project was not scrutined transparently before Najib’s administration went ahead to approve it, adding Dr Mahathir’s call was the “right thing” as the mounting debts of the country could become “time bombs”.
“If Malaysia can’t pay, then it shouldn’t carry on with this project,” he said.
Ping said the project was too costly even though there would be expected to ferry a high number of tourists and commuters.
“If it is cheap, then it is okay but we are talking about RM100 billion. The amount is too high.”
Another economist, Yeah Kim Leng of Sunway University, said the project could be revived when the country was in a better financial position.
He said it was more important for the government to reduce the nation’s current debts than to proceed with the project.
“After knowing the full extent of the government’s total debts, it is prudent to call off the HSR and other mega projects,” he said.
Will it ruin ties? Maybe not.
Some Singaporean netizens have expressed disappointment by Malaysia’s plans to axe the deal but they also appear to be empathetic to the reasons.
Jotting down his comments on the Facebook site of a news outlet, Richard Koh said there was a need to slow down some developments when Malaysia’s finance and economy is “in trouble”.
However, Koh still hopes the HSR would link Kuala Lumpur and the republic and be extended to Malaysia’s northern city of Penang.
“Once you are well to do, it is good to have the HSR all the way to Penang and beyond…..,” Koh said, as quoted by the Bernama.
Robert Lim suggested the project be fully privatised and be developed by a consortium comprising Malaysian companies instead of canceling the HSR project.
“Revise HSR from Penang to Singapore to eventually replace the aging KTM (Keretapi Tanah Melayu),” he wrote.
Dr Mahathir, who was sworn in as Malaysia seventh Prime Minister just over two weeks ago, said Malaysia would have to pay RM500 million (US$125 mil) in penalties to Singapore over the cancellation of the project.
However, to ensure that ties remained strong between the two nations, some Singaporeans came up with the noble suggestions that their government waive the compensation.
“I believe that this is one great opportunity for Singapore to build stronger ties with Malaysia. That is, for Singapore to forgo the legal or whatever fees involved in the cancellation of the HSR project,” Wah Ng said.
“Malaysia and Singapore are like siblings and Malaysia is truly going through a financial tsunami.
“Although the forfeited amount, for breaking the project agreement with Singapore, is not small to give up, it will speak volumes about Singapore.
“..I believe by doing so the ruling party would gain a better standing not only among Singaporeans and the people in ASEAN.”