The High Speed Rail (HSR) project that Malaysia signed with Singapore will not see the light of day.

In a May 28 interview with Financial Times, Malaysian Prime Minister Dr Mahathir confirmed that the project will be dropped, saying that the HSR "is going to cost [them] RM110bn (SGD$37bn) and will not earn [them] a single cent."

The fate of the HSR project became uncertain when Mahathir's Pakatan Harapan coalition promised to review all expensive infrastructural projects (including the HSR) if it got elected in the 14th Malaysian general election.

When Mahathir took office on May 9, he made good on his promise to review the HSR and other expensive projects so as to improve national debt, sparking off a new round of debate if the HSR project will be scrapped.

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Malaysia will incur "billions in penalty"

Earlier this month (May 3), the CEO of MyHSR (the company managing the Malaysian side of the HSR) told Channel NewsAsia that cancelling the project would be a waste of the “eight years of many man and woman hours” and would incur billions in penalty for pulling out:

“If we don’t do it, not only we have to incur abortive cost in our own border, we also may have to provide compensation to Singapore. This, even though it is quite big, is minuscule compared to huge opportunities we are going to miss.”

It is unsure how much the penalty will cost Malaysia, but it is likely to be less than what the project will ultimately cost if it went through.

Halting the project in its tracks

To date, HSR SG (a subsidiary under the Land Transport Authority in charge of the HSR) has identified qualified candidates for the tender of the design of the Jurong Terminus, viaducts, tunnels, and other related infrastructure.

Additionally, an Advance Engineering Study for the design of the Singapore portion of the HSR infrastructure has been awarded and a Joint Developing Partner has been appointed to help both sides manage the project, which was schedule to begin construction in 2019. 

It is unsure what Singapore will do now about the project that Dr M has publicly confirmed its demise.

Top image is an artist impression of the Jurong Terminus of the HSR by Farrell.