Top management officials are still in the dark over the proposed privatisation of the state-owned national railway company KTM Berhad to a local consortium, Gamuda-Malaysian Mining Corp, which has been awarded a RM14.44 billion electrified double-tracking rail project.

"We held a management meeting on Monday immediately after the public announcement (by the consortium on the proposed privatisation).We only read about it in the newspapers," a senior official, who asked not to be identified, told malaysiakini.

"We want to know the nature of the privatisation exercise. We also want to know what is going to happen to us," he added.

Earlier, while announcing it had received the letter of award for the contract for the last phase of the North-South electrified double-tracking project from the government, the successful consortium also disclosed that it would be managing the privatisation of KTM Berhad.

KTM Berhad was corporatised on Aug 1, 1992 but remained in government control. Attempts to privatise the loss-making entity had failed. This year, a senior KTM official said it is expected to suffer a loss of about RM100 million compared with last year's RM180 million.

Room for improvement

Malaysiakini learned that a team from Gamuda-MMC is expected to undertake a due diligence on KTM Berhad soon, and the move to take over the railway company could happen as early as next year.

Sources said the government is 'generally not very happy with the performance and the services of KTM Berhad both in the passenger and freight sectors.'

"It sees there is much more room for improvement given the rapid growth of industries and the demand for inland travel, which the railway company has not been able to capitalise on," it added.

In Europe and the US, focus is now on developing high-speed trains to compete with air travel.

The massive contract to Gamuda-MMC calls for the electrification and double-tracking of the two remaining portions covering a total of 636 kilometres of the North-South project. The targeted date of completion is 2008.

Among the on-going work is the 174km double-tracking between Rawang and Ipoh, which is being undertaken by a separate locally-led consortium and is scheduled for completion in early 2005. The first phase involving the Kuala Lumpur-Seremban-Rawang-Port Klang Link (double tracking) was completed in 1995.

According to studies, when the double-tracking is completed in the entire stretch of the country by 2008 and the adding of new rolling stocks, KTM Berhad will be able to increase the volume of cargo transported from five million tonnes per year at present to 10 million tonnes per year.

Intercity ridership is expected to increase from four million per year at present to seven million per year in 2008.

Effective competition

Former transport minister Ling Liong Sik said early this year that KTM Berhad should then be able to have a network and system that would allow it to provide services that could compete effectively for passenger and freight traffic along the west coast of Peninsular Malaysia.

Eighty per cent of freight revenue, a major source of KTM revenue which last year stood at about RM120 million, comes from the west coast. Hence, the orientation of the North-South rail line on this side of the peninsula.

The North-South double-tracking line forms part of the so-called Malaysia-Thailand Landbridge on which KTM and the State Railway of Thailand are working together to promote.

Total freight volume moved across the border by rail this year is expected to reach a total of 60,000 TEUs (twenty-foot-equivalent units) compared with last year's 45,000 TEUs handled by four service providers - Trans Asia Sdn Bhd, Freight Management Sdn Bhd, Trans Allied and PTP Landbridge.

This rail line in turn forms part of the proposed Asian rail services known as Trans-Asia Rail Link between Singapore and Kunming, China.

Industry analysts say the contract award for the remaining portions of the North-South double-tracking project in Peninsula Malaysia and the privatisation of the railway company form part of the government's massive plan for the total transformation of the inland transportation system for both domestic and external/transshipment trade linked to ports and airports in this country.