PETALING JAYA, June 25 — Prime Minister Tun Dr Mahathir Mohamad denied today claims that his government had decided against scrapping the East Coast Rail Line project because his friend Tan Sri Vincent Tan has a stake in it.

Dr Mahathir said he has no knowledge of Tan’s involvement, and maintained that the decision to keep the project going for now was purely a fiscal policy decision.

“I don’t know about it… maybe you should ask him,” he replied when asked about the matter at a press conference here.

This morning, The Edge reported T7 Global Bhd saw its share price surge by as much as 34.5 per cent in early trading amid news reports that the controversial East Coast Railway Line (ECRL) project could avoid the axe under the new government.

The stock hit an intraday high of 56.5 sen in early trade, before ending the morning session at 51.5 sen, up 22.62 per cent or 9.5 sen, with 23.83 million shares exchanging hands.

Tan, the Berjaya Group owner who made his fortune mostly under Dr Mahathir’s tenure as prime minister, was reported to be a substantial shareholder of T7 Global, with the acquisition of 21 million shares or a 5.04 per cent stake.

The newly elected Pakatan Harapan (PH) government had initially said it would scrap the ECRL among other “mega-projects” that had been placed under review as part of efforts to rein in a staggering federal debt.

But in recent weeks, coalition leaders changed their tone and Minister of Finance, Lim Guan Eng, said they would review the rail link project instead.

Among the major reasons for the change in policy was the costly compensation that would have to be paid to cancel the ongoing project, now already at 20 per cent completion.

Today, Dr Mahathir said the project could have a positive impact but said the terms of its contracts must be renegotiated to bring down costs.

“All these terms need to be renegotiated, and if we get better terms, of course, we will continue but we hope to reduce costs a lot because a lot of wrong things are being done,” he said.

“For example, borrowing RM55 billion from China; we don’t think it should cost that much.

“Also, the condition that the Chinese company can use its own workers and buy everything from there. So, what is there for Malaysia? We want to gain something for Malaysia.”