Singapore Business Times, July 5, 2006
By PAULINE NG
IN KUALA LUMPUR
MALAYSIAN conglomerate YTL Corp is in discussions with the Malaysian government on a high-speed rail link between Kuala Lumpur and Singapore, its group managing director Francis Yeoh said yesterday.
In an interview with Bloomberg, Mr Yeoh indicated that the plan had the backing of the Malaysian government, which is keen to develop the South Johor Economic Region to drive economic activity and leverage on Singapore's two integrated resorts.
'This is one project that everyone knows can work. Our government is very serious about this and they're encouraging us to look at it,' he said.
A high-speed train would take two hours or so to cover the 300km between Kuala Lumpur and Singapore. Today's rail service takes seven hours.
Before he stepped down, former prime minister Mahathir Mohamad approved an electrified double-track rail line running 636km from north to south of the Peninsular. But the RM14.5 billion (S$6.2 billion) project was shelved by Abdullah Badawi after he took the reins of government in 2003. The line approved by Dr Mahathir was to have been funded by the government and built by a consortium involving Malaysian Mining Corp and Gamuda.
Mr Yeoh indicated yesterday that YTL would fund its line privately.
He said that if YTL is given the concession it will float its 50 per cent subsidiary Express Rail Link (ERL) to raise the RM6-8 billion needed.
ERL, which turned profitable in 2003, operates the non-stop KLIA Express from Kuala Lumpur Sentral to Kuala Lumpur International Airport (KLIA) in Sepang, as well as a rapid-transit service that makes three stops at key towns along the route.
Mr Yeoh said he is confident that agreement on a rail link to Singapore could be reached in two years, but said political wrangling between Malaysia and Singapore on issues such as the location of Malaysia's Customs, Immigration and Quarantine facilities and land owned by Malaysian state railway Keretapi Tanah Melayu (KTM) would likely complicate matters.
Analysts said it would be a huge feather in YTL's cap if it can pull off the project - but noted that carriers serving the Kuala Lumpur-Singapore route could be affected. Mr Yeoh said he plans to offer these carriers and other parties like KTM and the operators of Changi Airport and KLIA stakes in the rail project.
It is not clear how the Singapore government will react to the idea, but YTL would need its agreement if new rail tracks are to be laid. There is considerable two-way traffic between both countries. Singaporeans are the biggest visitors to Malaysia, with over nine million arrivals last year.
Malaysia's National Physical Plan recommends a high-speed rail system that connects all the state capitals be built as part of a proposed integrated national transport system.
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