ECRL back on track, alignment shortened by 40km: Daim

Malaysia's Prime Minister Mahathir Mohamad reacts during an interview with Reuters in Langkawi Malaysia

It said the construction cost of the first two phases of the project will be cut to 44 billion ringgit ($10.7 billion), down one-third from the original cost of 65.5 billion ringgit ($15.9 billion).

"We are pleased to announce that the construction cost of Phases 1 and 2 of the ECRL has now been reduced to RM44 billion". But the project's cost ballooned as construction went underway, with the finance ministry estimating that the price tag could reach as much as 81 billion ringgit.

The ECRL supplementary agreement, which has been the subject of ongoing negotiations from July past year, was signed here at 11am local time Friday.

The deal follows months of vacillating over the East Coast Rail Link, which connects Malaysia's west coast to eastern rural states and is a key part of China's Belt and Road infrastructure initiative. But this new government is concerned about cost.

According to earlier reports, Phase 1 of the rail line will be from Klang Valley to Kuantan, while Phase 2 will cover Kuantan to Kuala Terengganu.

The Prime Minister's Special Envoy Tun Daim Zainuddin is in Beijing to meet with representatives from China on the ECRL. It is not a new agreement or contract, but an improved deal, he said at a press conference at the Malaysian embassy.

Malaysia said Friday a major Chinese-backed railway had been revived following a deal to cut costs, lifting a suspension slapped on the project when a corruption-plagued regime lost power a year ago.

He said the stop at Gombak in Selangor has been cancelled.

Malaysia's government said Friday it has made a decision to resume a China-backed rail link project, after the Chinese contractor agreed to cut the construction cost by one-third. The lower cost also means the government can save in terms of interest on a lower loan, he said. FYI, our current prime minister Tun Dr Mahathir Mohamad is expected reveal those information in the press conference.



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