Singapore insists both Malaysia and the republic must respect the 1962 water agreement

Singapore’s Foreign Ministry reiterated that both Malaysia and Singapore must comply fully with the 1962 water agreement after Prime Minister Mahathir Mohamad criticized that the price of raw water sold to the republic is “ridiculous” and said he wanted to renegotiate the terms of the deal, according to a report in The Star Malaysia Online on Tuesday.

In a statement on Monday, a spokesman of the ministry said the 1962 treaty was guaranteed by the two governments in the Separation Agreement which was registered with the United Nations when Singapore broke away from Malaysia in 1965.

In a separate interview with Channel NewsAsia and Bloomberg Television, Mahathir said that the price – 3 sen per thousand gallons – is ridiculous and that Malaysia will approach Singapore to renegotiate the terms of the deal.  However, he said the issue is not urgent.

The water deal, which is due to expire in 2061, entitles Singapore to draw up to 250 million gallons a day (mgd) of raw water from Johor River daily.  In return, Johor is entitled to a daily supply of up to two percent of treated water or 5 mgd of the water supplied to Singapore.

However, the 1961 and 1962 water agreements provided for a price review after 25 years – in 1981 and 1987 respectively.  But Malaysia chose not to review the price then, said Singapore’s Foreign Ministry in its website.

Singapore pays 3 sen per thousand of gallons of raw water and sells treated water back to Johor at 50 sen per thousand gallons.

Mahathir, in his interview with Bloomberg on Monday, criticized the water supply deal with Singapore as “too costly”.

But Singapore allowed for a renegotiation when Mahathir later raised it in 1998.  Several rounds of talks were held over four years and Malaysia continually raised the asking price for water.

In a booklet, entitled Water Talks, Singapore said it costs the government RM2.40 to treat every thousand gallons of water and by selling them to Malaysia at 50 sen, the republic is providing a subsidy of RM1.90 per thousand gallons of water.