This article first appeared in Forum, The Edge Malaysia Weekly on July 1, 2024 - July 7, 2024

I have lost count of the number of twists and turns the Kuala Lumpur-Singapore high-speed rail (HSR) project has taken, but amid the whirlwind of speculation over costs, there are two critical points that demand our attention.

First, let’s cut through the noise and remind ourselves that this is no ordinary government project — it will be a private investment. With the Malaysian government openly admitting its financial limitations, the onus falls squarely on the private sector to fund the HSR. This isn’t business as usual; the evaluation, awarding and oversight processes for this project must reflect its unique nature. The method of evaluating and awarding the project must be different and we therefore cannot apply the same standards or processes as if we were awarding a typical government contract. Any consortium brave enough to take on this Herculean task must have both the financial muscle and internal controls necessary to ensure nothing short of success.

Secondly, it is perplexing to see the conversation shift away from the project’s immense economic potential. This isn’t merely about connecting two cities; it is about propelling Malaysia into a new era of economic prosperity. As the single largest infrastructure endeavour in our nation’s history, the far-reaching economic and environmental benefits of the HSR far outweigh its construction costs. It is an investment for the future that will pay dividends for generations to come.

Kuala Lumpur and Singapore represent two of the most significant economic powerhouses in Southeast Asia. The KL-Singapore route is the world’s busiest international airline route with a staggering 4.9 million seats sold per year. The demand for connectivity between these two bustling metropolises is undeniable.

Linking these cities via HSR could create one of the largest economic conurbations globally. Malaysia and Singapore’s bilateral trading volume reached US$83.53 billion in 2022, underscoring the compelling economic benefits of the HSR. MyHSR, the government agency driving the project, has forecast substantial growth for Malaysia and crafted a socioeconomic development plan for all states along the HSR alignment. The estimated social impact is RM269 billion, with the potential to create over 700,000 jobs. Additionally, HSR’s environment-friendly nature is expected to eliminate about 10 million tonnes of CO2 emissions within the first 50 years of operations.

The HSR project will benefit Malaysia from economic, environmental and social standpoints. Covering 54% of the population, the HSR offers significant economic opportunities across the nation. Projects like Bandar Malaysia, KLIA Aeropolis, Malaysia Vision Valley 2.0, Iskandar Malaysia, and the Johor-Singapore Special Economic Zone will be direct beneficiaries, attracting private-sector investment and driving regional development.

With concerted collaborative effort between the government and the private sector, and through targeted development programmes, this will encourage and accelerate entrepreneurship and increase investments in new business opportunities, laying the foundations for a knowledge-based economy and enhanced socioeconomic growth. This focus is vital for revitalising smaller towns, encouraging young talent to remain local, and ensuring even investment and income distribution.

While Malaysia grapples with past financial mismanagement, other nations are leveraging post-Covid-19 infrastructure spending to drive economic growth. Today, there are HSR lines in Indonesia and Thailand, and even Laos has leaped ahead and rolled out its own project, leaving us in the dust. Infrastructure spending across the region is strong and the appetite for economic growth is robust.

Thailand has embarked on an ambitious journey, rolling out multiple HSR lines as part of its Thailand Transformation 4.0 Plan. The Eastern Economic Corridor alone is projected to generate a staggering RM2.5 trillion in incremental gross domestic product (GDP) impact and create over one million employment opportunities by 2037.

The Masterplan for Acceleration and Expansion of Indonesia’s Economic Development is focused on bolstering national connectivity and corridor development. The Jakarta to Bandung HSR is poised to attract RM370 billion in investments into selected industrial zones, driving a 2.2%+ incremental GDP growth in the Java Economic Corridor.

Singapore’s Significant Infrastructure Government Loan Act underscores its commitment to massive public infrastructure expenditure, raising S$90 billion (RM313 billion) for critical projects.

The Philippines’ Build! Build! Build! programme seeks to triple public infrastructure expenditure, targeting a GDP contribution of P2.38 trillion (RM191 billion) or 6.3% of GDP by 2028, with a sharp focus on high-impact rail transport infrastructure.

Vietnam’s 2021–2030 Special Economic Development Strategy prioritises high-value industries and infrastructure projects, aiming for an average GDP growth of 7% between 2021 and 2023 and a GDP per capita of US$7,500 (RM35,400).

Having pioneered the first high-speed rail line in 1964, Japan has long understood the transformative power of rail infrastructure for connectivity and economic growth. JR Central Japan Railway Co, demonstrating relentless ambition, is now leading the development of a groundbreaking superconducting maglev rail line, set to revolutionise travel. This privately funded project achieved a record speed of 603kph on the test track. The maglev line will connect Tokyo to Osaka, covering 24% of Japan’s land area and serving 60% of its population, while accounting for 66% of the nation’s GDP growth. This new mega-region will boast a GDP greater than that of France. Japan’s forward-thinking approach acknowledges that the ¥9 trillion (RM264 billion) project cost is minimal compared to the substantial economic benefits that the superconducting maglev line will bring to the entire country.

The UK, US and Australia have also outlined ambitious infrastructure plans, underscoring the global momentum towards enhanced transport connectivity.

The UK’s “Build Back Better” and National Infrastructure Strategy Plan outline an ambitious US$8.3 trillion investment over the next five years, with a focus on transport connectivity and achieving net zero emissions by 2050. The US’ Bipartisan Infrastructure Bill allocates a whopping US$550 billion to transport infrastructure, with a significant portion earmarked for high-speed rail projects. Australia’s 10-year infrastructure programme, valued at US$81.3 billion, places a strong emphasis on transport connectivity and freight projects, including major rail expansion.

Globally, the appetite for high-speed rail remains insatiable. The pandemic did not halt the expansion of the high-speed rail network, which grew by more than 40% between 2020 and 2022, increasing from 44,000 to some 59,000km. As at 2023, Asia leads the charge, boasting three-quarters of the world’s HSR lines. China dominates with an impressive 45,000km of track.

Europe has ambitious plans to double its high-speed network by 2030 and triple it by 2050. In the US, plans are underway for transformative high-speed rail projects in California; Texas, linking Houston and Dallas; and the northeast corridor, connecting Boston with Washington, DC, via New York and Philadelphia.

The pressing question is whether Malaysia will seize this crucial opportunity to align with the clear and growing global momentum. It is imperative that the HSR proposals recently received by the government of Malaysia via MyHSR are evaluated with fresh eyes, recognising their unique private investment nature and their integral role in our national master plan. The HSR project linking Kuala Lumpur to Singapore is the critical economic boost Malaysia urgently needs. As we face significant global challenges such as climate change, economic uncertainty and shifting geopolitical landscapes, we must wake up to domestic economic realities that demand our attention. We have no choice but to act now. With other nations aggressively investing in high-speed rail infrastructure, Malaysia cannot afford to be left behind. Embracing this project not only positions us competitively on the global stage but also ensures we harness the immense economic potential that such transformative infrastructure promises.

Natasha Zulkifli is the stakeholder director at YTL Construction and founder director at Women in Rail Malaysia

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