The Government of Penang will proceed to implement the project Light Rail Transit (LRT) from Komtar to Bayan Lepas despite the recent rejection of the Ministry of Finances' request for loans and assurances amounting to RM2 billion.

Chief Minister Chow Kon Yeow has said that the project is very important for the state's economy and will not give up the state government.

"The state government is continuing to carry out the LRT project as the Penang government has several other financial options to fund projects under the Penang Transport Master Plan (PTMP),” he said in a statement.

He added that the state government will continue to establish trust in the federal government to prioritise the funding of the project and the corresponding treatments of Penang that have continued to play a major role in advocating foreign direct investments in the manufacturing sector of the state.

Chow said he also shared and presented the same matter to the Minister in the Prime Minister’s Department (Economy) Datuk Seri Mustapa Mohamed in a discussion on allocations for 12th Malaysia Plan (12MP) for Penang last Thursday (Nov 26) in the federal capital.

"In fact, the matter and same stand was also presented to Finance Minister Datuk Seri Tengku Zafrul Tengku Abdul Aziz during the Budget 2021 Consultation Dialogue: Penang organised by the Northern Corridor Implementation Authority (NCIA) on Aug 8 2020 and the Engagement Session for 12MP Preparation with Senior Minister cum Minister of International Trade and Industry, Datuk Seri Mohamed Azmin Ali on Aug 2 2019 in Penang,” he said.

He also reminded Finance Ministers and Perikatan Nasional (PN) government that in a letter to him on 1 Oct 2019, former Prime Minister Tun Dr Mahathir Mohamad confirmed the federal government's project bonds.

PTMP is an initiative from the state government that costs RM46bn to provide an underwater tunnel linking the island with the mainland, highways, LRT, monorail, and a comprehensive bus network on the island and mainland.

The LRT project covers an area 29,9 km of rail route with an approximate cost of RM8 billion from 27 stations from Komtar to the International Airport of Penang, and other reclamation areas in southern Penang.