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About 150 companies express interest in KL-Singapore High Speed Rail project

The upcoming Kuala Lumpur-Singapore High Speed Rail terminus for the Singapore end will be built at the site occupied by Jurong Country Club. - Pic source: TODAY file photo The upcoming Kuala Lumpur-Singapore High Speed Rail terminus for the Singapore end will be built at the site occupied by Jurong Country Club. - Pic source: TODAY file photo

Singapore's TODAY newspaper reported earlier today that more than 70 companies and consortiums have already registered their interest in participating in the joint market sensing exercise on the Kuala Lumpur-Singapore High Speed Rail (HSR) project, ahead of the deadline today, Friday, October 16.

These include entities based in Singapore, Malaysia and overseas, said the Singapore Land Transport Authority (LTA), in response to TODAY’s queries. “We are encouraged by the interest,” the spokesperson added. “Companies that have yet to register are still welcome to do so.”

The Request for Information (RFI) exercise, launched by Malaysia’s Land Public Transport Commission (SPAD) and the LTA, is aimed at gauging market sentiment on the project, as well as gather industry opinion on its commercial and technical aspects.

Companies have till noon on Friday to register their interest in participating. Those found to be eligible will then submit their responses to the RFI documents by November 18 at 12pm.

These companies and consortia are expected to come from across the HSR value chain and include entities based in Malaysia, Singapore, Asia-Pacific, Europe, Middle East and North America.

In a joint statement (later on Monday), CEO of SPAD, Mohd Azharuddin Mat Sah and CEO of LTA, Chew Men Leong said: “We are pleased by the market’s positive response to the RFI exercise. We look forward to receiving their feedback next month.
“This feedback will be critical in helping us with the commercial model of the project, and will help ensure that this project starts off on the right note.”

The exercise, which will wrap up by the end of the year, will help inform the subsequent formal tender process. National University of Singapore transport researcher Lee Der Horng said the large number of companies which have registered is due to the HSR market in countries such as Japan and Europe “getting more saturated”.

For example, there are not many HSR lines or plans in the pipelines in Japan and Europe, said Professor Lee. “So, that’s why much of the attention has shifted to Asia,” he added.

He also noted that the international community sees that both the Singapore and Malaysia governments have been “very sincere” and will get the HSR project moving.

A HSR project, from Jakarta to Bandung on Indonesia’s main island of Java, some 160km away, was finally given to China after the Indonesian government repeatedly changed its mind about the project, before eventually agreeing to accept China’s bid of US$5.5 billion. The deal was officialy signed today.

Japan was long expected to build the HSR link but China entered the contest earlier this year, and Tokyo’s bid was rejected last month after a chaotic bidding process that infuriated the Japanese. With China bagging the joint venture deal, construction is set to start next year and the line to begin operating in 2019. 

State-owned China Development Bank will provide 75 percent of the funding, with the rest coming from the Chinese railway company and Indonesian consortium. The line will not need any financing from the Indonesian government, nor a government guarantee. One reason that Indonesian officials gave for rejecting the Japanese bid was that it would require government funding.

On how many companies or consortiums are likely to bid for the KL-Singapore HSR project, Prof Lee expects “not more than 10” to do so. There are not many qualified companies globally which are able to deliver an HSR project, he noted.

Dr Walter Theseira, senior lecturer at SIM University, said: “It’s not surprising for many companies to be participating because this is likely to be one of the largest civil engineering projects in Singapore and Malaysia.

Although 70 companies participated, that doesn’t mean all 70 are capable of being the lead contractor to design and build the entire (HSR) system.”

Leaders of China and Japan have indicated their interest in taking part in the project.

Firms reportedly keen include Chinese companies such as China Railway Construction Corporation (CRCC) and CRRC Corporation - formed from a merger of two Chinese rail giants. A Japanese consortium - comprising East Japan Railway Company, Sumitomo Corporation, Hitachi and Mitsubishi Heavy Industries - has been formed ahead of the bidding for the project.

French company Alstom Transport Asia-Pacific’s senior vice-president, Mr Dominique Pouliquen, also said that his firm is “very keen”.

“No doubt this particular HSR project represents a major opportunity for economic growth in the region and will have long-term impact on the rail development in ASEAN countries,” said Mr Pouliquen.

A Korean mega consortium, comprising 50 public and private enterprises, is among the parties that have registered their interest to participate in the joint market-sensing exercise for the HSR project. A spokesperson from South Korea’s Ministry of Land Infrastructure and Transport (MOLIT) said the Korea Rail Network Authority (KR) has applied to take part in the Request for Information (RFI) exercise, on behalf of the Korean consortium.

Some of the public enterprises in the consortium include KR, Korail, Korea Land and Housing Corporation, Korea Railroad Research Institute and Korea Transport Institute. There are also plans to include more companies in the consortium “as soon as possible”.

The spokesperson from MOLIT said the length of the Kuala Lumpur-Singapore HSR is “very similar” to Korea’s first HSR, the Gyeongbu HSR, which travels from Seoul to Busan.

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In Malaysia, a new company known as MyHSR Corporation Sdn Bhd (MyHSR Corp) will take the lead in making the project a reality. The company will act as the developer and owner of the project.

The project is estimated to garner an economic impact of RM100 billion in gross domestic product (GDP), of which RM70 billion will be generated through construction, operational and multiplier impact activities. The balance RM30 billion is expected to be generated through wider economic benefits from the rising activities in the property and tourism industries as well as the services sector.

The 350km-HSR link was first announced by Malaysian Prime Minister Najib Abdul Razak and Singapore Prime Minister Lee Hsien Loong in February 2013. Subsequently, a joint ministerial committee was formed to look into the details and modalities of the project.

Singapore's terminus station will be at Jurong East, while the one in KL will be in Bandar Malaysia. With the HSR, it will take about 90 minutes to get from one end of the line to the other. The total number of stations planned is 8.

Jurong East was chosen as it dovetails with Singapore's overall plans to transform the area into a second Central Business District, according to a statement issued on May 5 this year after the Leaders' Retreat between both countries.

During the meeting, both leaders noted "steady progress" on the project and that agreements have been reached on the dual co-located Customs, Immigration and Quarantine (CIQ) configuration, the frequency bands to be reserved for HSR operations, as well as on locating the depot and stabling facilities in Malaysia.

Malaysia had earlier identified six intermediate/transit stations in between both ends:

  • KL (at Bandar Malaysia South terminus),
  • Putrajaya,
  • Seremban (Labu),
  • Ayer Keroh (Melaka),
  • Muar (Pagoh),
  • Batu Pahat,
  • Nusajaya, and
  • the final stop in Singapore (at Jurong East terminus).

The project will request the construction of a brand-new line with specific tracks, which will allow trains to circulate at over 250km per hour. Currently, maximum train speed on the KL-Singapore railway link reaches only 130km per hour.

With travelling time cut to 90 minutes each way, Malaysians in Singapore can return home in the shortest possible time to see their loved ones over the weekend or during festive seasons.

Singaporeans can indulge in their favourite pastime of eating and shopping, and returning on the same day. Businesses will also benefit. At the moment, it is a one-hour flight or a five-hour drive to KL.

Singapore was Malaysia's second-largest trading partner in 2014. Total trade in 2014 was in the region of US$60 billion (S$80 billion). Singapore is also Malaysia's second-largest source of foreign investment in 2014, with total investment reaching about USD$2.23 billion.

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