PUTRAJAYA, April 15 — Malaysia Rail Link Sdn Bhd (MRL) CEO Datuk Seri Darwis Abdul Razak said today work on the East Coast Rail Link (ECRL) will begin as early as this coming May.
He said the expected construction date is subject to the approval from relevant authorities.
“We are looking as early as May subject to the approval from relevant authorities.
“Effectively when we signed the supplementary agreement on 12 April, the suspension was lifted so we are now in the process of planning and mobilising all the resources,” he told reporters, after Prime Minister Tun Dr Mahathir Mohamad held a press conference on the matter, here today.
When asked about the interest rate of the loan from China’s Exim bank, Darwis said this would most likely not change from what the previous administration obtained but other terms will be discussed to arrive at a lower overall financing cost.
“We are still negotiating... the interest rate remains the same as of the previous agreement, which is 3.25 per cent, but we are still negotiating other terms.
“For example, the moratorium period, because the construction has been moved from 2024 to 2026 hopefully, Exim bank will be coming next week to address this,” he said.
Darwis added that the project will be 85 per cent funded by Exim Bank, with the rest to come from local sources.
However, he said the operations of the ECRL would be divided equally between Malaysia Rail Link Sdn Bhd (MRL) and the China Communications Construction Company Ltd (CCCC).
“Losses will be distributed equally but profits will be more towards MRL, with up 80 per cent,” he said.
Earlier, Dr Mahathir said the renegotiated deal would lead to a lower financial obligation for the country without specifying if this was a result of cheaper interest.
“We are saving a lot of money and also the interest rate on a smaller sum of money that we have to pay.
“When we reduce the cost, it means of course the interest rate also goes down. But there may be other areas where the cost will be reduced, this will be worked out later on,” he said.
Darwis’s subsequent clarification indicates that the PM was likely talking about the overall interest bill.
In response to compensation due to the suspension of the project since last July, Dr Mahathir said the matter was not raised during negotiations with the Chinese government.
“We will start off as if there had been no interval between the stoppage of the construction and the beginning of new construction,” he said.
Putrajaya announced the resumption of the ECRL last week for RM44 billion or RM21.5 billion less than the original price.