The high-speed rail project linking Singapore and Kuala Lumpur, the Malaysian capital, has been terminated by mutual agreement, Singapore said on Friday.

Malaysia has allowed "the termination of this high-speed rail project and must compensate Singapore for the costs already incurred in fulfilling its obligations", Singapore's transport ministry said in a statement.

The project was first proposed 10 years ago and was approved in 2013, with two extensions and a deadline for construction on December 31, 2020. In June 2020, the two Southeast Asian neighbors agreed to shelve the project, which had been shelved many times, because of discussions about costs.

The 350-kilometer high-speed railway, originally scheduled to go into operation in 2026, will reduce the travel time from Singapore to Kuala Lumpur to about 90 minutes, but now it takes more than four hours to drive.

Malaysian local media reported in November that Malaysia was considering the southern city of Johor Bahru as the end of the high-speed railway, rather than Singapore.