KL threatens Britain over loan

KL threatens Britain over loan

KUALA LUMPUR (AFP): Malaysia said yesterday it will take legal action if Britain stops a 234-million-pound (350-million-dollar) loan for the Pergau dam project after a London-based pressure group challenged the lawfulness of the deal.

"Legal or not legal, they must pay," Malaysian Prime Minister Mahathir Mohamad was quoted saying by Bernama news agency, adding:

"When they signed it, they did not say (if it was) legal or not legal."

The non-government World Development Movement (WDM) on Wednesday took to the British high court a civil suit accusing Foreign Secretary Douglas Hurd of over-stepping his legal powers in granting aid for the dam.

The loan for the hydro-electric project in northeastern Kelantan state is said to be the biggest ever provided by Britain as development aid.

Mahathir said whatever the outcome of the suit, an agreement had been made and could not be declared illegal.