PUTRAJAYA: Allegations that 4,500 acres (1,821ha) of land will be given to China for free in the re-negotiation of the East Coast Rail Link (ECRL) contract are incorrect, said Finance Minister Lim Guan Eng.
“We are looking at the (supplementary) contract. If there is anything additional, I think it would have to go through the Cabinet.
“So far, I think we have not been informed that 4,500 acres of land have been given for free.
“I think we have to wait for the official contract details to be revealed,” he said after witnessing the signing of an agreement for the industrial collaboration programme (ICP) between the government and Bombardier Hartasuma Consortium (BHC) yesterday.Lim was responding to allegations made by blogger Raja Petra Kamaruddin claiming while Malaysia got a RM21.5bil reduction in the ECRL project, China was getting ten times more in land and development rights.
He also claimed China Communications Construction Company Ltd (CCCC) was being given around 4,500 acres of land to develop industrial parks along the ECRL corridor in the east and west coast of the peninsula.
The MoU, which Raja Petra allegedly sighted, also included development of TOD (transit-oriented development) in seven ECRL project stations.
Malaysia Rail Link Sdn Bhd and CCCC inked a supplementary agreement on April 12, with the government announcing the construction cost of the ECRL at RM44bil, 32.8% lower than the initial RM65.5bil price.
Explaining the TOD, Lim said this was a standard development tool for all infrastructure projects.
“TOD is definitely not for free. You have that (land) given for all LRT and MRT projects but it is not given for free,” he said.
On another matter, Lim said he had no details on plans to swap 1MDB bonds held by Retirement Fund Inc (KWAP) and Lembaga Tabung Haji with equity in Bandar Malaysia.
However, he pointed out bonds or loans taken in relation to 1MDB were guaranteed by the Finance Ministry on behalf of the government.
“Their loans are secured 100%. The one that should worry is the MoF (Ministry of Finance) because we guaranteed their loans.
“The government needs to find money to pay all these loans of 1MDB, which we get nothing in return in terms of value,” he said, responding to a report that the government was considering swapping the 1MDB bond held with Bandar Malaysia’s equity.Given its impact on the economy, the government last week announced Bandar Malaysia project’s revival.
On the ICP, Lim said it was a platform to provide opportunities for local industry players to take part in the global supply chain and market.
The agreement signed between the government and BHC will see the company supply and refurbish trains for Prasarana Malaysia Berhad, carry out mid-life refurbishment of two-
car train sets to become four-cars for the Kelana Jaya Line and provide 27 new trains for the same line.
The contract for the new trains is valued at RM1.7bil and the company has committed to maximise the use of local content at a minimum of 35%, while for the RM473mil mid-life refurbishment contract, BHC will expand its existing local supplier database in rolling stock by using components and services of 14 local companies.
“The ICP deliverables will certainly benefit Malaysia’s growth in the rail industry and indirectly, enable Malaysia to take another step towards becoming a developed nation,” said Lim.