LONG-TERM TARGET: Malaysia-Singapore high-speed rail link project to create new economic zones, industrial hubs and townships
The Land Public Transport Commission (Spad) is optimistic that the high-speed rail (HSR) link between Malaysia and Singapore will be profitable in the long term.
Its chief executive officer Mohd Nur Ismal Mohamed Kamal said the key is to ensure that the ridership level is sustainable economically.
“The first two years of operation is going to be challenging. We expect ridership to build up after the second or third year of operation,” he said recently.
A two-prong strategy has been planned for the HSR to be a sustainable development and value-creating.
Mohd Nur Ismal said the builder will first need a template to establish new economic zones along the corridor and create industrial hubs like oil and gas, energy, biotechnology and palm oil, among others.
“The builder must also provide the conditions to attract people to live, work and play in the new townships developed along the corridor,” he said.
Mohd Nur Ismal said Spad has conducted a study on ridership levels.
The 350km rail link may have up to seven stations located, among others, in Seremban (Negri Sembilan), Ayer Keroh (Malacca) and
Muar, Batu Pahat and Iskandar Malaysia (Johor), before heading to Singapore.
He said although structured on a public-private partnership, the government will play a key role to help fund the HSR project.
"We are not going in with a set of rigid ideas. We have several ideas on how we want the HSR to be implemented."
Meanwhile, Mohd Nur Ismal was tight-lipped on the project cost, which is believed to be between RM40 billion and RM50 billion.
He said alignment, design and technology choices will determine the costs.
"Rolling stock and the systems are big ticket items, but the civil portion will cost a lot more. We have an indication as to how much it will cost, but it will depend on what the bidders can offer."
Mohd Nur Ismal said the company operating the HSR line will benefit as it will have a 30-year concession and the investment returns are government-guaranteed.