Malaysia revives massive rail project

Kuala Lumpur: Malaysia has said a major Chinese-backed railway had been revived following a deal to cut costs, lifting a suspension slapped on the project when a corruption-plagued regime lost power last year.

The railway was among several infrastructure projects in Malaysia supported by Beijing but put on hold after the shock defeat of a coalition that had ruled the country for six decades.

Critics said the projects lacked transparency, could saddle the government with debt, and were in reality aimed at quickly funnelling money to former leader Najib Razak to help him pay back cash looted from a sovereign wealth fund.

After months of negotiations between the Malaysian and Chinese governments and the companies involved, a new agreement was reached to resume the East Coast Rail Link, the Malaysian prime minister´s office said in a statement.

The cost of the rail link, which will connect Malaysia´s east and west coasts, was reduced to 44 billion ringgit ($10.6 billion dollars) from its original price of 65.5 billion ringgit, it said.

"This reduction will surely benefit Malaysia and lighten the burden on the country´s financial position," said the statement. Malaysia´s new administration inherited a mammoth national debt.