China may export its controversial maglev train expertise to Malaysia as it ramps up efforts to be one of the world's leading railway builders. Mainland firms including CNR Tangshan Railway Vehicle are in the running to win billions of dollars of railway contracts in the Southeast Asian country as part of the sector's 'going out' policy. The Ministry of Railways signed a contract on Monday with Industrial and Commercial Bank of China to help companies win projects abroad. But questions are being asked about whether the magnetic levitation project is the right choice to showcase the country's train-building prowess. The German-developed technology uses powerful magnets to suspend a train above a track and propel it at speeds of up to 450km/h. Shanghai's 30km maglev line - the only one in commercial operation in the world - is suffering from both significant financial losses and criticism from nearby residents. It was built at a cost of 10 billion yuan (HK$11.36 billion) - 3,300 yuan per centimetre. CNR Tangshan sales chief Wang Dianwu said the company had been in talks with parties in Malaysia over various railway projects but he declined to comment on a Malaysian newspaper report that it was in talks to build a cross-sea maglev rail link between Georgetown on Penang island with Butterworth on the West Malaysian peninsula. If this project becomes a reality, it will be China's first export of its maglev railway system. CNR Tangshan is a subsidiary of China CNR Corp, a state-owned rolling stock manufacturer that listed in Shanghai last month. Keretapi Tanah Melayu (KTM), the Malaysian railway company, is expanding capacity and in the next six months is expected to call for an open tender to buy 38 six-car trains worth two billion ringgit (HK$4.58 billion). KTM president Aminuddin Adnan reportedly said it was looking at companies from China, Japan and Europe to supply the trains, to be delivered over 18 to 24 months. But Aminuddin indicated KTM does not appear eager to buy the Chinese maglev. He told the Malaysian newspaper Star: 'I would rather wait for the second-generation trains to come before we seriously look into this. Otherwise, we may be investing in a technology which is still at an early stage.' Penang Chief Minister Lim Guan Eng told the Edge newspaper he had not received any proposal for a maglev rail link between the island and the peninsula. CNR Tangshan was reportedly in talks to build the maglev rail link between Penang and the peninsula, as well as two 350km/h rail links, one connecting the Malaysian capital, Kuala Lumpur, with Johor Bahru and another linking Kuala Lumpur with Kuantan. 'My personal view is Malaysia won't use maglev. It's much cheaper to build high-speed rail than maglev,' said Jiong Shao, the head of China equity research at Nomura. The higher cost of maglev railway is due to the special elevated tracks that need to be built. 'China also doesn't own its technology for maglev. It's from Siemens.' Under Beijing's plan to expand rail exports, the railways ministry will provide political guidance and support to firms in their efforts to win contracts overseas while ICBC will provide financing to foreign projects undertaken by Chinese firms.