ALOR STAR – The federal government has agreed to write off Kedah’s rural water supply debt, amounting to RM699 million, after the signing of the state water services industry restructuring agreement today.
Environment and Water Minister Datuk Seri Tuan Ibrahim Tuan Man said the move will reduce the state’s water supply debt from RM1.82 billion to RM1.12 billion, with the balance being taken over by Pengurusan Aset Air Bhd (PAAB).
He said the agreement will enable critical rural water supply infrastructure projects, such as the upgrading of the Lubuk Buntar Lama, Jenun Baru, Bukit Selambau and Sg Limau water treatment plants, to be implemented through grant financing to meet consumer demand.
“The balance of the loan will be transferred to PAAB. The payments will be restructured for a period of 45 years through a lease to be charged to Syarikat Air Darul Aman Sdn Bhd (Sada).
“Sada will be given a moratorium on the lease payment for the first five years to help it build a strong financial base before starting repayment to PAAB.”
Tuan Ibrahim said PAAB will build water assets in Kedah based on the build-and-lease approach and subject to competitive rates, compared with commercial financing.
“Sada will improve the efficiency and quality of water services to consumers with the construction of new treatment plants and upgrading of existing ones, as well as replacement of pipes and distribution systems.” – Bernama, March 4, 2021
