Feasibility study on scrapped rail project
Malaysiakini
Nov 9, 2006
Fauwaz Abdul Aziz

The Economic Planning Unit (EPU) and Ministry of Finance have been given two months to study the proposal by the Malaysian Mining Corp (MMC) and Gamuda to build a double track electrified railway line, expected to cost RM9 billion.

Transport Minister Chan Kong Choy said the presentation on the project was made by MMC and Gamuda on Tuesday to the Cabinet Committee on Public Transport.

“They made a presentation, and EPU has been tasked to look into all the details, especially from the financial aspect, together with the Ministry of Finance, and they should come back to the committee within two months,” he told a press conference in Kuala Lumpur today.

He said the project would be funded as a Private Financing Initiative (PFI) but refused to disclose any further details.

However, Reuters today reported that MMC and Gamuda proposed to spend RM9 billion for the project, 20 percent funded by equity and the balance by debt.

Citing a source familiar with the project, the report said the railway line would take up to five years to build and would be leased to the government over a period of perhaps 20-30 years.

Dr M's brainchild 
 
The brainchild of former premier Dr Mahathir Mohamed, who awarded the project to MMC-Gamuda days before his retirement in October 2003, the project was part of a larger scheme to link Singapore to Seremban and Ipoh to Padang Besar and would have cost the government RM14.5 billion.

In December 2003, Prime Minister Abdullah Ahmad Badawi suspended the project, citing the need to focus on more needy development schemes and trim a serious budget deficit.

On Tuesday, Bernama reported Deputy Prime Minister Najib Abdul Razak announcing the possible revival of the project.

This follows an earlier announcement in April by the Transport Ministry that had called for a review of the project, particularly for the northern region of the peninsula.

The RM4.6 billion double-tracking project from Rawang to Ipoh, now under construction, will be completed next year.