Malaysia, China In Talks To Form SPV For Passenger Train Leasing

Malaysia and China are in talks to set up a Special Purpose Vehicle (SPV) to lead a new Railway Industry Empowerment Programme involving the leasing of passenger trains.

The Transport Ministry said both governments signed a Memorandum of Understanding (MoU) on April 16 to boost cooperation in the railway sector. 

The programme will be carried out under a government-to-government (G2G) arrangement, with the SPV managing its implementation.

“The government has, in principle, agreed to implement the Railway Industry Empowerment Programme through the leasing of passenger trains under a G2G arrangement between the government of Malaysia and the government of the People’s Republic of China,” the ministry said in a written reply in Parliament on Nov 5.

It added that the SPV will be structured so that a Malaysian government-owned company holds 51% of the shares.

The update came after Puchong MP Yeo Bee Yin asked about the status of the electric multiple unit (EMU) leasing plan and the government’s move to acquire a majority stake in CRRC Rolling Stock Centre (Malaysia) Sdn Bhd, which runs a train assembly plant in Batu Gajah, Perak.

Currently, CRRC Rolling Stock Centre is 70% owned by CRRC Zhuzhou Locomotive Co Ltd and 30% by CRRC (Hong Kong) Co Ltd.

Malaysia is expected to lease 62 new passenger train sets from China by 2027 for Keretapi Tanah Melayu Bhd (KTMB). 

The RM10.7 billion, 30-year deal includes maintenance, repair and overhaul services to keep the trains in good condition and ensure enough are available for daily operations.