Good News for Rail Firms but How Fair will the Tender Process be?
Not often do businesses come across a US$17-billion project, more so amid an economy that is running through turbulent times.
The Singapore – Kuala Lumpur (KL) rail project will thus have firms in this space, both regional and international, put their full might behind a tender process, expected to last a year or thereabouts.
“Fair and objective”
Malaysian Prime Minister Najib Razak has vowed to keep the process fair and objective as what is at stake is the integrity of the two countries.
But firms from China are certain to hold the edge. It recently emerged in the media that many of the trains that Singapore bought from a Chinese entity for its own MRT network were defective.
China also upped the ante with Premier Li Keqiang writing a personal letter to Mr Najib recently, affirming its commitment to investments in Malaysia. This is a practice that China scrupulously follows whenever a major project emerges in the pipeline.
Commercial ventures often see strange bedfellows with even Chinese and Japanese firms banding together on some projects despite the two countries having a rocky political relationship. They are in this rail project, too!
An RFI was launched in October and 14 players shortlisted among 98 submissions received.
A Channel News Asia photo
The NGNBN Example
I am reminded of Singapore’s NGNBN project awarded in 2009 to StarHub/Nucleus Connect, who in turn deployed the Huawei solution.
Several international players were in the race with one of them dropping out after participating in the initial Expression of Interest initiatives. They felt Singapore will only pick a local bidder — and they were right as the award attested to.
A Level-Playing Field Essential
Participating in a complex tender involves significant investments from the bidders. Any absence of a level-playing field will blow it all away, so to that extent the exiting bidder took a wise decision early. That was timely damage control.
At the same time, though, there have been several other projects in Singapore awarded to US-based multinational companies. One of them was the Standard ICT Operating Environment (SOE) project which went to EDS/HP. It, however, did not proceed along expected lines.
The digression aside, the Singapore-KL rail project is expected to take 10 years for completion that being a 400-km network, out of which only 15km fall within Singapore. The line is expected to shorten the KL-Singapore travel to 90 minutes as against around seven hours currently through the Woodlands-KL Sentral line. By road the journey takes close to five hours.
Mr Najib has been quoted as saying that it would be a game-changer “with the domestic service running from Johor to Kuala Lumpur providing new impetus for its economic development.”
A fair selection process will ensure they get the best out of what is a well-thought-out project.
G Joslin Vethakumar
Top of the Word 
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