A high-speed rail link between Singapore and the Malaysian capital of Kuala Lumpur may be completed by 2020, leaders of the two countries said yesterday.
The rail network will be a "huge game changer" and transform the way the two countries do business, Malaysian Prime Minister Najib Razak said in Singapore at a joint press conference. Singapore Prime Minister Lee Hsien Loong said the journey may take 90 minutes.
"If it's really going to happen it'll be a major breakthrough," said Chua Hak Bin, a Singapore-based economist at Bank of America. "There's a huge amount of trade and investment between the two countries, so any kind of major transport infrastructure that can speed up and shorten travel time will bring great benefits."
Relations between the two neighbours have reached the warmest in decades in recent years as the countries ended years of bickering over issues from territorial disputes to the use of Malaysian-owned railway land on the island.
The announcement marks the first definitive agreement to proceed with the rail project since Malaysia's YTL Corp said in 2006 it was in talks with the government on a proposal.
Najib, who took office in 2009, did not say which companies would build the rail line. He also said it was too early to reveal the costs of the link.
"We've done the initial study and the numbers look quite encouraging," Najib said.
"As a business model, it is doable. It's going to be implemented on a basis of a private-public partnership, in which the private sector will run the project," he said.
"We will provide infrastructure support and very strong government participation."
"It's a strategic project for both countries," Lee said of the rail link. "It will change the way we see each other. It's the way people in London and Paris are able to think of it, really as twin cities where you can commute, go up there, do business, meet friends, have a meal and come back all within maybe two-thirds of the day."