KUALA LUMPUR: Prime Minister Mahathir Mohamad confirmed in a press conference on Monday (May 28) that Malaysia will drop the Kuala Lumpur-Singapore high-speed rail project (HSR), saying the project will not benefit his country.
"It is a final decision, but it will take time because we have an agreement with Singapore," Dr Mahathir said.
"It's not beneficial. It's going to cost us a huge sum of money. We'll make no money at all from this arrangement," he added. "(The HSR) is only a short track. It is only going to save people one hour by taking the HSR."
When asked by Channel NewsAsia if the decision had been communicated to Singapore, Dr Mahathir replied: "I don't know."
But he said Malaysia will discuss the matter with Singapore.
Prime Minister Mahathir's confirmation on Monday comes after he told Financial Times in an interview that the move was necessary to "avoid being declared bankrupt".
“We need to do away with some of the unnecessary projects, for example the high-speed rail, which is going to cost us RM110 billion (US$28 billion) and will not earn us a single cent. That will be dropped,” the 92-year-old was quoted as saying to the Financial Times.
Malaysia's new finance minister Lim Guan Eng last week said that the government's total debt exceeded RM1 trillion, with the scandal-ridden 1MDB as a main contributor.
Dr Mahathir also said the government would talk to the Chinese government about renegotiating "unequal treaties", said the report, including the Chinese-backed US$14 billion East Coast Rail Link.
Many large projects and government agencies set up by former prime minister Najib Razak were also "not necessary at all", Mahathir was quoted as saying in the report.
“Mostly it was about trying to make the prime minister popular and it cost billions of dollars,” he said.
The HSR project which was due to be completed in 2026, cuts across four states in Malaysia and sought to stimulate development along the corridor and create economic clusters around the seven stations from Bandar Malaysia, Putrajaya, Seremban, Melaka to Muar, Batu Pahat and Iskandar Puteri, before crossing to Singapore.
Dr Mahathir had earlier said that Malaysia was going to look into how it can reduce the cost of any potential exit from the HSR project.
Replying to Channel NewsAsia's queries, a spokesperson for the Ministry of Transport said it "has not yet received any official notification from Malaysia".
"We had agreed to proceed with the HSR project based on mutual benefits and obligations set out in the HSR bilateral agreement," she said, adding that the ministry will wait for official communication from Malaysia.
Additional reporting by Sumisha Naidu.