Problems facing S’pore-KL high speed rail link
Nanyang Technological University report details the problems the project could face, including from competition from airlines.
SINGAPORE: A planned high-speed rail (HSR) connecting Singapore and Kuala Lumpur faces questions of profitability and political manoeuvring.
A CNBC report said ticket pricing and competition from airlines could likely cause problems.
It quoted a report from Nanyang Technological University (NTU) saying that the HSR could struggle to provide the hoped-for boost to Asean cohesion.
The report was prepared by Research Fellow Wu Shang-su and Associate Professor Alan Chong.
“With operating deficits common among most HSR operators around the world, the Singapore-Kuala Lumpur HSR may not be an exception,” the report said. “Despite the possibility of bilateral commuting services theoretically becoming profitable, construction and maintenance costs would surely rely on overall income.”
Moreover, with commercial aviation as the railway’s primary competitor, redirecting large numbers of aerial passengers to the HSR may not be feasible, said the report.
There are about 45 daily flights between the two capitals, with average capacity of each flight at about 200 people, which meant 9,000 daily passengers could be carried in both directions at maximum, the report said.
But one HSR train could seat a maximum of 1,000 passengers, so it would take 10 to 15 uninterrupted train services per day, assuming the HSR performs at peak capacity every time, to match the number of passengers flights could carry, the report continued.
Ticket pricing would also be a key issue, particularly if the HSR was meant to compete with cars, buses and conventional trains, added the report.
“If the HSR charges too much, passenger traffic would not significantly contribute to its finances, the NTU report said. “If the HSR tickets are priced too low for recouping its sunk costs, increased passenger volume may not adequately compensate but contribute to overall financial deterioration.”
According to the report, navigating through government bureaucracy could also derail progress.
The report said HSR projects tended to be lucrative when supported by urban development such as airports, restaurants, cinemas and shopping outlets, near the new rail stations.
However, it said, in Malaysia, undertaking such land development projects would require backing from both federal and state governments and this could be complicated.
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“Therefore, building HSR lines could require political bargains that may result in detours, or even impasse, in striking an agreement amongst various political forces,” CNBC quoted the report as saying.