MALAYSIA and Singapore’s long-standing dispute over the price of raw water sold to the republic is inching towards progress, with Putrajaya submitting a revised offer recently, said sources. 

The offer to revise the 1962 water agreement was sent by the Malaysian government earlier this month, with the deadline set for January 31.

The initial response from the Singapore side is positive, said a source familiar with the negotiations. 

“Both the Malaysian and Singaporean sides are looking at a package deal,” the source added. 

A meeting between Malaysia and Singapore on the same matter is expected to be held after the Chinese New Year break. 

The Malaysian team comprises the Attorney-General’s Chambers, Foreign Affairs Ministry and Water, Land and Natural Resources Ministry. 

Both countries agreed to resolve the long-standing issue of the water price review after the 9th Malaysia-Singapore leaders’ retreat in April last year. 

Singapore has resisted attempts to increase the price of raw water, saying Malaysia gave up its right in 1987 after it chose not to review the price of water. 

But Prime Minister Dr Mahathir Mohamad raised the issue in 2018, after Pakatan Harapan took over the federal government, by stating that the price of raw water sold to Singapore “did not make sense”. 

Under the 1962 agreement, Singapore is entitled to draw up to 250 million gallons (944 million litres) from Sg Johor daily. 

Currently, Singapore pays 3 sen per 1,000 gallons of raw water.  It then sells treated water back to Johor at 50 sen for the same volume, a fraction of the cost of treating the water. 

In return, Johor is entitled to a daily supply of treated water of up to 2% or five million gallons of the water supplied to Singapore. 

In practice, however, Singapore has been supplying 16 million gallons of treated water to Johor daily at its request.

The agreement expires in 2061. 

In September last year, Foreign Minister Saifuddin Abdullah told Nikkei Asian Review that Putrajaya will submit its offer soon and reiterated this point when he presented Wisma Putra’s 2019 report card earlier this month. – January 24, 2020.