Cabinet should take urgent steps to ensure that the multi-billion ringgit electrified double tracking rail award will not plunge Malaysia into a trade war with China and India, which will also be the worst possible 30th anniversary commemoration of the establishment of Malaysia-China diplomatic relations
by Lim Kit Siang
Wednesday): The fear expressed by the Primary
Industries Minister, Datuk Seri Dr. Lim Keng Yaik that India and China might
retaliate and spark a trade war with Malaysia because of the Malaysian
government decision to award the RM14.5 billion electrified double tracking
rail project to Malaysia Mining Corp Bhd (MMC) and Gamuda Bhd. should be
seriously and urgently considered by the Cabinet.
He said: “After three years of intense government-to-government negotiations, they are suddenly told that they are no longer part of the project. They should be angry and I don’t blame them.”
The government-to-government negotiations for barter deals with China and India involving the exchange of palm oil for contracts in the multi-billion ringgit electrified double tracking project was pursued by Malaysia three years ago, involving three Ministries, the Transport, Finance and Primary Industries – at a time when the price of palm oil was at an all-time low.
Two years ago, Keng Yaik had claimed as a coup his success to work out a multi-billion ringgit barter trade, under which two of the largest buyers of palm oil – India and China – will emerge as key players in the multi-billion ringgit electrified double tracking rail project.
At least, Keng Yaik was frank enough to admit that Indian Railway Construction Co (Ircon) and China Railway Engineering Corp (CREC), which had been issued still unrevoked Letters of Intent for the project at a government-to-government transaction to accept payment in kind with palm oil, had been given a raw deal when they were “unceremoniously” and unfairly rebuffed with the award of the contract to MMC-Gamuda in the last-minute in the most outrageous and indefensible circumstances.
But it is not enough for one Cabinet Minister to admit to the lack of transparency, uneven-handed treatment and unfairness in the award, as it has far-reaching international diplomatic and trade implications.
The Cabinet should take urgent steps to ensure that the multi-billion ringgit electrified double tracking rail award will not plunge Malaysia into a trade war with China and India, which will also be the worst possible 30th anniversary commemoration of the establishment of Malaysia-China diplomatic relations.
Malaysia is preparing to celebrate the 30th anniversary of the establishment of Malaysia-China diplomatic relations in a big way, with national celebrations probably for the whole month of May next year.
The Malacca State Government is preparing a year-long celebrations starting as early as January 10 with events to commemorate the 600th anniversary of Admiral Cheng Ho’s historical trip from China to Malacca.
However, these anniversary celebrations would become quite meaningless if held under a hot or cold trade war between Malaysia on the one hand and China and India on the other because of the mishandling of the multi-billion ringgit electrified double tracking rail award.
Would Malaysia and the state governments have to scale down their celebrations if there is such a full-scale trade war?
Keng Yaik has said that shippers have complained that their palm oil shipments had been rejected by both China and India purportedly because of low quality and that retaliation could come in a “subtle way”, such as shippers being given the runaround when delivering their palm oil shipments.
The cancellation of Road Builder (M) Holdings Bhd’s RM261 million road
contract by the Maharashtra State Government in India immediately after the
award of the rail project to MMC-Gamuda was clearly the first act of
“subtle” retaliation by India.
* Lim Kit Siang, DAP National Chairman