Singapore agrees to final extension of KL-S'pore High-Speed Rail project suspension till Dec 31

[SINGAPORE] Singapore has agreed to further suspend the High-Speed Rail (HSR) project that would link it with Kuala Lumpur for seven months, till the end of the year.

In a Facebook post on Sunday, Transport Minister Khaw Boon Wan said that Malaysia's Senior Minister for International Trade and Industry Azmin Ali wrote to him to ask for the extension to discuss Malaysia's proposed changes to the project.

"As any project change requires our agreement, the extended suspension will allow both countries to assess the changes that Malaysia has in mind," he said.

"In the spirit of bilateral cooperation, we have agreed to a final extension of the suspension period to Dec 31, 2020," he added.

"This should provide sufficient time for Malaysia to clarify its proposal and for both sides to assess the implications of the proposed changes," said Mr Khaw.

In a separate statement, Mr Azmin said both governments have agreed to resume discussions "in the near future". "The discussions will encompass some of the proposed changes in the commercial and technical aspects of the project," he added.

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Mr Azmin said he has been asked by his country's Cabinet to lead the Malaysian team in the discussions with the Singapore government on the project.

The announcements came the same day as the deadline to decide on the project's fate, after both countries agreed to suspend it for about two years in September 2018. The decision had pushed the completion date for the 350km rail line from end-2026 to January 2031.

In response to media queries, Singapore's Ministry of Transport confirmed that Malaysia's government had informed Singapore that it would like to propose some changes to the HSR project and requested the seven-month extension.

"Singapore continues to believe that the HSR project is a mutually beneficial project that will strengthen the connectivity and people-to-people ties between our two countries," it said.

"We look forward to receiving Malaysia's formal proposal on the changes to the HSR project soon, so that both sides can begin discussion immediately," added the ministry.

Mr Khaw said on Sunday that the Covid-19 pandemic inconveniences discussions but tele-conferencing can largely overcome the difficulty.

"The key is joint commitment to the project's vision and mutual trust," he said.

"Nevertheless, the HSR is a complex project, and both sides have to be convinced that the changes do not undermine the original intent of the project," he added.

Mr Khaw disclosed on Friday that Malaysia had asked for an extension, and said then that Singapore remains "committed and enthusiastic and positive" about the project's prospects for both countries.

It was a message he reiterated on Sunday, saying: "I remain optimistic that a HSR linking our two capitals will benefit both our peoples."

The rail line would cut travelling time between Malaysia's capital and Singapore to 90 minutes, compared with more than four hours by car.

Former Malaysian prime minister Mahathir Mohamad had initially wanted to scrap the HSR as part of a review of his country's mega projects, in a bid to trim a RM1 trillion (S$325 billion) national debt.

However, after the change of government in Malaysia's 2018 general election, a deal was negotiated to suspend the project instead as a cancellation would have entailed a high amount of compensation under the HSR agreement.

MyHSR Corp, the Malaysian company in charge of developing the HSR, said last year that it was reviewing proposed changes to the project and identifying cost-reduction options for the Malaysian government.

Malaysia had paid Singapore S$15 million for the abortive costs the Republic incurred as a result of the project being suspended.

Mr Khaw told Parliament in October 2018 that a suspension beyond two years would mean current cost estimates would likely no longer be valid, and affect the viability of the project and its business case. A longer suspension would also impact development plans for the Jurong Lake District, which will host the Singapore HSR Terminus and many transport, commercial, residential and recreational developments, he added.

Should the HSR project be terminated, Malaysia would have to reimburse the project implementation costs incurred by Singapore up to the point of suspension. THE STRAITS TIMES