Minister in the Prime Minister's Department Datuk Abdul Rahman Dahlan and Singapore’s Coordinating Minister for Infrastructure and Minister for Transport Khaw Boon Wan signed the MoU on behalf of their respective governments, witnessed by Malaysia Prime Minister Datuk Seri Mohd Najib Tun Abdul Razak and Singapore Prime Minister Lee Hsien Loong.
This signifies Malaysia and Singapore’s firmest commitment yet to the iconic project.
The long-envisioned plan, six years behind an earlier target completion date, follows a US$5.5 billion project already underway in Indonesia. India last year chose Japan to build a US$15 billion network, its first.
Asian nations are modernizing their transport infrastructure while China has set up the world’s biggest HSR network. Japan has been running bullet trains for more than five decades now.
As countries embrace the latest technology, it’s also pitting Chinese and Japanese manufacturers of super-fast trains against rivals such as Siemens AG and Bombardier Inc.
“It’s a good sign because generally investors are looking to see more inter-connectivity across Southeast Asia," said Alan Richardson, a Hong Kong-based fund manager at Samsung Asset Management.
"That will help to provide greater resilience to, or less reliance on other developed economies and also, should provide a more stable geopolitical environment with increasing inter-connectivity,” he said.
According to a press release, both governments will take responsibility for developing, constructing and maintaining the civil infrastructure and stations located in their respective countries.
Both governments have also agreed that the HSR will have eight stations, with terminals in Bandar Malaysia (KL) and Jurong East (Singapore), and six intermediate stations in Putrajaya, Seremban, Ayer Keroh, Muar, Batu Pahat and Iskandar Puteri.
There will be an express service between KL and Singapore, a domestic service between local stations and a shuttle service between Iskandar Puteri and Singapore.
All stations will be designed to integrate with the local public transport systems to ensure seamless connectivity. The trains will run at a top speed of more than 300 kilometres per hour.
The agreement will pave the way for final negotiations on the development and execution of the 300km (185 miles) line connecting Singapore and KL. Construction works may begin in 2018.
An international tender for the project will be issued next year, Najib told reporters on Tuesday.
Last year, Singapore and Malaysia said they would reassess the 2020 target for the completion of the project because of the scale and complexity of the venture.
Leaders of the two countries had announced in 2013 the HSR link may be completed by the end of this decade, with Najib calling it a “huge game changer” that will transform the way the neighbors do business.
"The high-speed rail is a key bilateral project for both countries," Lee’s office said in a statement Monday.
"The two governments’ commitment to this project is a reflection of our strong bilateral ties and our continued efforts to deepen relations. When completed, the HSR will boost connectivity, strengthen economic ties and forge closer people-to-people linkages."
A joint project team, which will comprise of representatives from MyHSR Corp and Singapore’s Land Transport Authority (LTA), will be formed to coordinate the planning and development works prior to the commencement of operations.
They will call for an international tender next month for a development partner to provide technical support to both the countries, according to a statement Tuesday from Malaysia’s Land Public Transport Commission and Singapore’s Land Transport Authority.
It is too early to discuss the cost of the project, Najib said.
In addition, to facilitate swift and seamless travel, both governments also agreed to co-locate the Customs, Immigration and Quarantine (CIQ) facilities at three locations, namely Singapore, Iskandar Puteri and KL, so that international-bound passengers will only need to undergo CIQ clearance by both Malaysia and Singapore authorities at the point of departure.
Essentially, commuters taking the express 90-minute service from Kuala Lumpur to Jurong East will be able to clear the CIQ checks of both countries' authorities, before they board the train. The co-located CIQ facilities will offer "swift and seamless" travel.
There will be co-located CIQ facilities at Iskandar Puteri, for commuters using the domestic service to clear CIQ checks before crossing into Singapore.
A bilateral committee comprising representatives from both governments will manage and regulate aspects of the project which may impact cross-border services.
The HSR line will trim the land journey between the two Southeast Asian cities to 90 minutes, from about five hours now.
It will also challenge the region's flourishing budget carriers such as Malaysia's AirAsia Bhd and Singapore Airlines Ltd's Tiger Airways, which fly passengers from Singapore to KL in about an hour.
"The Singapore-Malaysia sector has among the largest airline capacity within the region," said John Mathai, Bloomberg Intelligence’s Singapore-based transport analyst.
"A high-speed rail could service some of the traffic within that segment, reducing congestion at airports."
Asia’s appetite for high-speed rail has also pitted Chinese rail giants such as CRRC Corp., and Japanese manufacturers Hitachi Ltd. and Mitsubishi Heavy Industries Ltd. against European rivals.
Japan, which built the world’s first high-speed train more than half a century ago, is stepping up efforts to export its bullet-train technology to meet a pledge by Prime Minister Shinzo Abe to triple infrastructure exports to 30 trillion yen (approx. US$284 billion) by 2020.
China, home to the world’s biggest HSR network, has identified the sector as one of 10 focus industries in a blueprint for economic development.
Japan aims to sell bullet trains to the project and the government supports bids by its companies, Transport Minister Keiichi Ishii said in December. The country beat China to secure a US$15 billion rail project in India.
Chinese Premier Li Keqiang is leading his nation’s overseas push by train equipment makers as part of the government’s broader strategy to turn the country into an advanced industrial nation.
He has targeted emerging markets in Africa, Latin America and Southeast Asia for rail-related orders, while also bidding for high-profile contracts in the developed world.
In October, a subsidiary of China Railway Group Ltd. partnered with local companies to win the rights to build a US$5.5-billion high-speed railway line in Indonesia, the country’s first.
Malaysia and Singapore received close to 250 submissions after calling for a Request for Information for the project, and 98 were shortlisted, the New Straits Times reported in December.
Fourteen foreign entities among the 98 were asked to present their views, including France’s Alstom, Germany’s Siemens AG, Spain’s CAF and Talgo SA, Canada’s Bombardier, a group led by China Railway, as well as consortium from Japan and South Korea, the paper reported, without saying where it obtained the names.
In a separate statement, Singapore's Land Transport Authority said that within the next month, it will call an advance engineering study tender for consultants to carry out engineering studies for the Singapore stretch of the HSR.
This study will include looking at the alignment of the rail link, the architectural and engineering design of the terminus station, noise and vibration issues, and the preparation of tender documents for the project's construction phase. The study is expected to start by the first quarter of 2017 and will take about 18 to 24 months to complete.