Kuala lumpur: Bilateral discussions are ongoing between Malaysia and China to form a special-purpose vehicle (SPV) responsible for undertaking the rail industry empowerment programme via a passenger train leasing arrangement, the Transport Ministry said. It stated that the government has agreed in principle to implement the project through a government-to-government (G2G) passenger train leasing method.

According to BERNAMA News Agency, the creation of the SPV will take into account the government’s decision for a Malaysian government-owned company to hold 51 per cent equity interest in the rolling stock assembler. This was revealed in a reply posted on the Parliament website, addressing a query from Yeo Bee Yin (PH-Puchong) regarding updates on the plan to lease electric multiple unit (EMU) sets approved by the Cabinet on August 14, 2024, as well as the acquisition of the 51 per cent stake in CRRC Rolling Stock Centre (M) Sdn Bhd.

The Transport Ministry further noted that as a commitment to implement the project, the government inked a memorandum of understanding with the Chinese government on strengthening cooperation in the railway sector on April 16, 2025. CRRC Rolling Stock Centre, which operates an assembly plant in Batu Gajah, Perak, is currently 70 per cent-owned by CRRC Zhuzhou Locomotive Co, Ltd, while the remaining 30 per cent is held by CRRC (Hong Kong) Co Ltd.

It was reported that Malaysia plans to lease 62 new passenger train sets from China by 2027 at a cost of RM10.7 billion for 30 years for Keretapi Tanah Melayu Bhd (KTMB). The leasing arrangement, which includes maintenance, repair, and overhaul, is intended to ensure that KTMB has a sufficient number of trains in service.