Malaysian Prime Minister Mahathir Mohamad on Monday said that he will drop the Kuala Lumpur - Singapore High Speed Rail (KL - SG HSR) project, as part of his efforts to restore the financial health of the country.
Mahathir made the remarks at a press conference, saying it was "a final decision" to cancel the project, but Malaysia still had to talk to Singapore over a penalty concerning the withdrawal, Xinhua news agency reported.
Mahathir said the penalty was around 500 million ringgit ($126 million).
In an interview with the Financial Times earlier, he called KL - SG HSR as one of the "unnecessary projects".
To control public spending, he also introduced a 10 per cent pay cut for his Cabinet ministers, abolished some organisations and vowed to terminate the contracts of some 17, 000 public employees.