KUALA LUMPUR: Sabah and Sarawak received the highest development allocations under Budget 2026, amounting to RM6.9 billion and RM6 billion respectively, said Prime Minister Datuk Seri Anwar Ibrahim.
He said the allocation for Sabah had increased from RM4.4 billion in 2022, while Sarawak’s allocation also continued to rise from RM2.9 billion during the same period.
Anwar explained that this increase reflects the government’s strong commitment to narrowing the development gap, especially in terms of basic infrastructure between Sabah and Sarawak and the other states, in line with the spirit of the Malaysia Agreement 1963 (MA63).
“Starting this year, the Special Grant Rate for Sabah and Sarawak is increased to RM600 million, compared to RM300 million in 2023,” he said during the tabling of the budget themed ‘Fourth MADANI Budget: The People’s Budget’ in Parliament today.
Anwar also informed that the government has allocated RM1.2 billion to ensure the continuity of electricity supply in Sabah, despite regulatory power over electricity having been fully transferred to the state government starting last year.
At the same time, he said the government will fund the Southern Link Transmission Line Project with an allocation of RM765 million to ensure long-term electricity supply continuity in the State.
This follows a landslide incident in Penampang that severed two high-voltage transmission lines, disrupting electricity supply to over 230,000 users on the East Coast of Sabah.
Additionally, the Sabah water project, involving RM1 billion in funding since 2024, is now in the implementation phase and is expected to be completed by next year.
Among the projects involved are the installation of new pipes in Tawau, and upgrades to old pipes in Kota Kinabalu, Penampang and Putatan.
For highway projects, Anwar said RM1.67 billion will be allocated next year for the Pan Borneo Sabah Highway Project, to ensure its implementation stays on schedule and to complete Phase 1A of the Pan Borneo Sabah Package, which has already been completed.
The Prime Minister also announced that Phase 1 of the Sarawak-Sabah Link Road (SSLR) is expected to be completed by November 2026, while Phase 2 is currently under construction and projected to finish by mid-2029.
“In addition, the Letter of Acceptance (SST) for the Trans Borneo Highway (PTB) project – which will complete the road network linking Sabah and Sarawak – will be issued as early as the first quarter of next year,” he said.
The government will also upgrade road pavement structures in the Durin and Salim sections under the Red Line in Sibu, Sarawak, with an allocation of RM350 million, bringing the total infrastructure investment in both states to RM48 billion.
In terms of digital infrastructure, Anwar announced the MADANI Submarine Cable Connectivity (SALAM) project, to be developed by the Malaysian Communications and Multimedia Commission (MCMC).
The project will cover a route of 3,190 kilometres with a cost of RM2 billion.
“This route will connect Sedili in Johor to Kuching and Sibu in Sarawak, and later to Tuaran, Kudat, Pulau Banggi, Sandakan and Tawau in Sabah,” he said.
Additionally, RM20 million will be allocated to improve Tamu Desa marketplace sites and business spaces with basic facilities, to support small traders in both states. – BERNAMA
