October 31, 2019 / 10:15 AM / 19 days ago

UPDATE 2-Malaysia-Singapore rail link back on at lower cost - Mahathir

* Train will cross one of world’s busiest borders

* Malaysia says price reduced by 36% to $757 million

* Mahathir wants new road bridge, slams Singapore (Adds Singapore comment in paragraphs 6 & 7)

By Fathin Ungku

JOHOR BAHRU, Malaysia, Oct 31 (Reuters) - A railway line linking Malaysia’s southern state of Johor with Singapore will go ahead after the projected cost was cut by a third, Malaysia’s Prime Minister Mahathir Mohamad said on Thursday, ending months of uncertainty over the delayed project.

The Rapid Transit System Link, which will bridge one of the world’s busiest border crossings, can carry up to 10,000 passengers an hour each way - more than 30 times the capacity of the existing train service.

The project will cost 3.16 billion ringgit ($757 million), down from 4.93 billion ringgit under the original proposal, a reduction of 36%, Mahathir said.

“We will build this railway, the agreement has been made. Half will be built by Singapore, the other half will be built by us,” Mahathir told reporters at the Malaysia-Singapore border.

“The details will be discussed with Singapore.”

Singapore’s transport ministry said it welcomed Malaysia’s decision.

“Both sides are now discussing the changes to the project, which Malaysia is proposing in order to reduce the project cost ... the discussions will take some time,” the ministry said in a statement.

The train project was originally suspended in May as Malaysia, saddled with more than $200 billion in debt, reassessed projects agreed under the previous administration. A further delay was agreed last month.

The Southeast Asian neighbours last year scrapped a high-speed rail project linking Singapore to the Malaysian capital Kuala Lumpur, which analysts estimated would cost around $17 billion.

Tensions often run high between Malaysia and Singapore, and Mahathir took a swipe at the city-state for not agreeing to a new road bridge between the two countries that he believes is the solution to congestion.

An estimated 300,000 people travel along the main highway between Johor and Singapore every day, the primary crossing between two countries, which separated from each other in 1965.

Singapore relies on Malaysia for around half of its fresh water and Mahathir threatened to increase the price.

“We are willing to sacrifice our money to support Singapore so that they can buy cheap water for themselves, but when we want to build a bridge to solve the traffic problem, they refuse,” he said.

“I don’t see why we are accommodating to Singapore when they’re not accommodating to us.” (Reporting by Fathin Ungku; Additional reporting by Aradhana Aravindan; Writing by Joe Brock; Editing by Hugh Lawson)

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