Government Received Offers to Build ERCL for RM10billion
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Tun Dr Mahathir Mohamad said the government has received offers to undertake the East Coast Rail Link (ECRL) project for as low as RM10 billion. The Prime Minister said Putrajaya would definitely consider the cheaper alternatives because it would be “stupid” to ignore them.
“Some even said they can do the ECRL for RM10 billion instead of RM55 billion. Some are Chinese companies, some are local companies. We have to talk with them if there is a possibility of reducing the cost from RM55 billion to RM10 billion. We would be stupid not to accept.
“But we have to study whether in fact you can reduce the cost that much,” he said in an interview with The Malaysian Insight, published on Monday, 28 Aug.
Dr Mahathir said the government was prepared to pay even more (than RM10 billion) but not RM55 billion for the rail link from Kelantan to Port Klang.
“Paying RM55 billion for something that the highest estimate is only RM30 billion would not be good for our financial health,” he said.
Dr Mahathir said this when asked to clarify the status of the China-backed ECRL project and two gas pipeline projects valued at another RM9 billion. It was reported that Dr Mahathir had tried to renegotiate the projects with China during his visit there earlier this month.
He later announced that the government was cancelling the three projects and blamed the previous administration for the inflated costs. However, the government has since said it was still studying how to deal with the ECRL.
Dr Mahathir told the newsportal that he explained to China that the government had no money and could not afford the projects.
“We either have to cancel the (ECRL) project or to defer it or to reduce the cost, that is what we want to do. The details of all these things must be done at the official level. For me, I had only said it in principle, we have no money and we have to cancel or defer, or reduce cost.”
Dr Mahathir also blamed former prime minister Datuk Seri Najib Razak for entering lopsided contracts with China for the projects.
“Unlike all other contracts, instead of paying based on work done, they paid according to a timetable.
“And we have found that the work done was only 13 per cent but we already paid 39 per cent. What do we get from the extra money that had been spent? This has got to be negotiated,” he was quoted as saying.