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This article first appeared in The Edge Financial Daily on October 6, 2017

KUALA LUMPUR: The cost to build the 350km high-speed rail (HSR) linking Kuala Lumpur and Singapore is expected to range between S$20 billion (RM62 billion) and S$25 billion, according to an estimate by the Institute of Southeast Asia Studies (ISEAS).

“When YTL [Corp Bhd] provided the estimate for the high-speed rail in 2006, the cost that they proposed was S$2.7 billion,” said ISEAS senior fellow Dr Francis E Hutchinson.

“And then when the government’s Pemandu (Performance Management and Delivery Unit) did their own analysis via a series of labs, it was then revised to around S$5.5 billion. Now the latest I have heard is around S$20 billion to S$25 billion,” he added when speaking at the Affin Hwang Capital Conference.

As for the breakdown of the cost, Hutchinson said around US$3.5 billion to S$5 billion is expected to be allocated to laying of tracks, electrification and system integration, all of which is equivalent to US$10 million per kilometre.

As for the civil infrastructure cost, which includes building of bridges and tunnelling works. Hutchinson said it may cost around S$15 billion.

“The underground cost in general is five times higher than the on-the-ground cost. Hence, even though the Singapore portion is only 6% of the total high-speed rail length, due to land scarcity, the tunnelling cost is expected to be higher,” he said.

On the rolling stock, Hutchinson noted that it will be around S$1.7 billion for a 60 four-car train set.

“And then, there is also the land acquisition cost that must be taken into account separately,” he said.

Based on his calculation, Hutchinson estimated that the one-way ticket price between Kuala Lumpur and Singapore will cost around S$60 to S$65.

“The frequency of the high-speed rail service, which I understand, is about four times an hour, one being an express non-stop service, and the other three times are for shuttle servicing the in-between intermediaries stop,” he said.

Comparing to Japan’s HSR, Hutchinson said the frequency for an express non-stop trip between Tokyo and Osaka is 14 times.

“That is partly to amortise the expenditure, but that should also be taken into consideration in designing any high-speed rail,” he said, adding: “If my calculation is true, is the one-way ticket cost justified?”

To recoup the investment on the HSR investment cost, Hutchinson noted that the railway owner must determine between collecting fare and non-fare revenue.

“In the case of Japan, two-thirds are from the fares, and the remaining one-third is from the hotels and shopping malls that it operates,” he said.

Meanwhile, an online poll conducted during the conference showed that around 68% of the participants think that the Chinese consortium will be awarded the contract to build the HSR.

“The Japanese, they tend to focus on the quality of their high-speed rail, and the record speaks for itself,” said Hutchinson.

The HSR will cut the travelling time between Kuala Lumpur and Singapore to 90 minutes.

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