Malaysia’s RM36 billion railway to hell

COMMENT | Even a RM20 billion reduction in the price of the East Coast Rail Link (ECRL) to about RM36 billion will not make the project feasible. It will still be highly risky, inviable based on traffic projections and an albatross around the Harapan government’s neck which it can ill afford for decades to come.

Lately, news reports quoting finance minister Lim Guan Eng have talked about the project, awarded to a China company, becoming acceptable to the government if the cost is reduced to about RM36 billion.

Previously, the project cost was put at RM55 billion from Gombak in Selangor to Kota Baru in Kelantan for the first phase. The second phase from Gombak to Port Klang was to cost RM11 billion, putting the total cost at RM66 billion.

But remember, out of this total cost, some RM20 billion was already over-priced by a strange transaction involving payments to a company overseas, from loans taken from China under the previous agreements for the first phase of construction. This was even before the project had achieved a corresponding completion of the project.

Also, China companies were involved in a pipeline project, billed as a pipeline to nowhere and unveiled by finance minister Lim, which cost nearly RM10 billion...