Govt inks RM2.7b deal with BHC to supply trains, refurbish Kelana Jaya LRT line

Lim Guan Eng witnesses the signing of an agreement for the Industrial Collaboration Program between the government of Malaysia and Bombardier Hartasuma Consortium in Putrajaya April 23, 2019. — Picture by Miera Zulyana
Lim Guan Eng witnesses the signing of an agreement for the Industrial Collaboration Program between the government of Malaysia and Bombardier Hartasuma Consortium in Putrajaya April 23, 2019. — Picture by Miera Zulyana

PUTRAJAYA, April 23 — The government has signed two contracts worth RM 2.17 billion with Bombardier Hartasuma Consortium (BHC) to supply and refurbish trains for the light rail transit (LRT) Kelana Jaya Line.

The two contracts, which were signed between Finance Minister Lim Guan Eng and BHC at the Ministry of Finance here today will see the rail-company supplying 27 new trains sets (KLAV-27) while providing a mid-life refurbishment (MLR) service to existing used 2-car train sets to 4-car train sets for the line.

Lim also announced that the deal will utilise the Industrial Collaboration Programme (ICP) platform, a countertrade policy where every government procurement will gain "add-on" value for every ringgit spent.

In this instance, the KLAV-27 which has a contract value of RM1.7 billion,

BHC has committed to maximise the usage of local companies at a minimum of 35 per cent, which is estimated at RM600 million, according to Lim.

“This approach is a catalyst for local industry players to be part of Bombardier’s global strategic cooperation and contribute to the Malaysian economic and industrial growth.

“Furthermore, hundreds of local job opportunities will be created over the next four years through this ICP implementation,” he said.

For the ICP of MLR, which has a contract value of RM473 million, BHC has also agreed to extend the existing local supplier database in rolling stock by using components and services offered by 14 local companies valued at RM100.7 million.

The KLAV-27 is expected to be delivered in phases throughout the next five years while the completion of the MLR will up to three years, Lim said.