Five months after suspending the East Coast Rail Link (ECRL) project, the Cabinet decided yesterday to terminate it.
On Thursday (Jan 24), Sin Chew Daily quoted a cabinet source as saying that this had been determined during Wednesday’s (Jan 23) Cabinet meeting.
However, the Cabinet did not discuss the issue of compensation with the contractor, China Communications and Construction Company (CCCC), the source said.
It is understood that the government is still in discussion with CCCC on the compensation amount.
Prime Minister Tun Dr Mahathir reportedly denied knowledge of the termination.
The report came a day after Singapore’s The Straits Times reported that Malaysia was seeking a new contractor to build the ECRL, after terminating the original contract awarded to CCCC on Tuesday (Jan 22).
The report said Putrajaya was seeking to halve the estimated project cost of RM81 billion to RM40 billion.
Government adviser Tun Daim Zainuddin said on Tuesday that Malaysia was still in negotiations with China over the ECRL.
The PH government shelved the rail project last August, saying it was too expensive.
The 688km China-backed infrastructure venture was to link the two coasts of Peninsular Malaysia across its central mountain range.
One minister has confirmed to Malaysiakini that the Cabinet had discussed the matter and it would be handled by the Finance Ministry.
When questioned on the matter, Finance Minister Lim Guan Eng declined to comment on the report.
“Can I answer this question at a different stage? I am sorry but this (event) is for the Cameron Highlands by-election.
“The government will make an announcement (on the ECRL project) at a more suitable location, if needed,” he told reporters at the Bersatu operations rooms in Kuala Medang in Cameron Highlands.