Malaysia PM Mahathir Mohamad wants to raise price of raw water sold to Singapore by more than 10 times

The current water agreement, which expires in 2061, sees Singapore drawing up to 250 million gallons a day (mgd) of raw water from the Johor River, and Johor entitled to 5mgd of treated water from Singapore.
The Straits Times

Malaysia’s Prime Minister Tun Dr Mahathir Mohamad has said he wants to increase the price of raw water supply to Singapore by more than 10 times to reflect the higher cost of living.

The current water agreement, which expires in 2061, sees Singapore drawing up to 250 million gallons a day (mgd) of raw water from the Johor River, and Johor entitled to 5mgd of treated water from Singapore.

Singapore pays 3 sen (1 Singapore cent) per thousand gallons of raw water, and sells treated water back to Johor at 50 sen per 1,000 gallons. Singapore has said this price is heavily subsidised and below the cost of treating the water.

Malaysia chose not to review the price when allowed to in 1987, but talks took place when then Prime Minister, Dr Mohamad, raised the issue in 1998. The talks did not result in a new pact.

In an interview with The Associated Press published on Monday (Aug 13), Dr Mahathir said Johor sells raw water to Melaka at 30 sen per 1,000 gallons which he described as “charitable”.

“To a foreign country, we need to get more than that,” he said.

Since his comeback as the world’s oldest prime minister after leading the Pakatan Harapan (PH) coalition to victory in the May general elections, Dr Mahathir had in recent interviews criticised the 1962 water deal as “too costly” and “ridiculous”, and said Malaysia would approach Singapore to renegotiate the terms of the deal.

Dr Mahathir had served a previous stint for 22 years from 1981 to 2003.

Singapore’s Ministry of Foreign Affairs (MFA) said in July Singapore has been clear and consistent in its position that Malaysia lost its right to review the price of water under the 1962 Water Agreement in 1987.

The statement came as Malaysia’s national news agency Bernama cited Malaysian Foreign Minister Saifuddin Abdullah as saying in an interview that “the agreement says the content of the agreement can be reviewed after 25 years”.

The MFA said Singapore’s position was set out in Foreign Minister Vivian Balakrishnan’s remarks in Parliament on July 9 where he said Dr Mahathir Mohamad had noted in 2002 Malaysia did not ask for a review when the water pact was due as it knew that any revision would also affect the price of treated water sold by Singapore to Malaysia.

The water issue has been brought up on several occasions in Malaysia since the PH took over the government.

In July, Johor’s Menteri Besar Osman Sapian said the state hopes that it can raise the price of the raw water that it sells to Singapore after discussions with its southern neighbour. In the same month, Datuk Saifuddin said his country will honour the water agreement with Singapore while seeking to restart negotiations on pricing.