Mahathir wants lower bids in rail projects
Mahathir wants lower bids in rail projects
Agence France-Presse, Kuala Lumpur
Prime Minister Mahathir Mohamad has urged contractors from India
and China to lower their bids for a multibillion-dollar railway
project in Malaysia, newspapers said on Sunday.
Mahathir said the double tracking railway project, part of an
ambitious trans-Asia link from Singapore to China, remained open
to them if they would accept a more reasonable value, the New
Sunday Times reported.
"Their initial quotation was 42 billion ringgit (US$11
billion). When we said it was too high, they reduced it to 24
billion ringgit," the paper quoted the premier as saying.
Mahathir said the willingness to reduce the contract value by
43 percent was an indication they had overpriced it.
The project was promised to Indian Railway Construction
Company (IRCON) and a consortium led by China Railway Engineering
Corp.
It was part of the government-to-government initiative which
includes a barter deal to increase exports of palmoil to India
and China.
Mahathir said the government could not pursue the project if
the cost were not lowered.
"Even at 24 billion ringgit, it is still too high. The people
who build the project must make the price more reasonable," he
was quoted as saying in the Sunday Star newspaper.
IRCON was to undertake the double tracking and electrification
works for the northern region which spans 338.8 kilometers (212
miles) from Ipoh to Padang Besar, which border Thailand.
China Railway would build the 297 kilometer southern link from
Seremban to Johor, which neighbors Singapore.
Mahathir said the government had conducted a study on the cost
and found it could be reduced considerably.
Malaysia signed letters of intent with the Indian and Chinese
firms last year.
The rail project has also attracted local bids, including one
from the MMC-Gamuda Bhd consortium led by tycoon Syed Mokhtar Al-
Bukhary.
The newspaper said Syed Mokhtar was ready to undertake the
project for 14 billion ringgit.
Asked about that bid, Mahathir said: "If he can do it, why
not."