In February, a joint United States-Israel attack against Iran left an indelible mark on global energy markets. In retaliation, Iran, controlling the strait of Hormuz, effectively blocked all passage through the waterway, which carries a fifth of global oil supplies.
Despite this, the Malaysian government has maintained its position of maintaining subsidies – at considerable cost. Removing fuel subsidies would have knock-on effects on economic activity – such as employment, participation in business activity and the utilisation of public services.
As oil barrel prices have spiked, the subsidy bill for April is expected to reach an estimated RM4 billion from RM700 million in February.
With supplies in limbo, this dilemma has raised concerns surrounding the sustainability of maintaining fuel subsidies while spurring wider discussions regarding transportation and how the nation chooses to view mobility.
This crisis has also brought to light a deeper structural vulnerability: Malaysia’s reliance on private vehicles.
On average, Malaysians spent up to 159 hours on the road in 2022. The mobility of millions of Malaysians hinges upon the maintenance of fuel subsidies to cushion their commuting costs, underscoring the nation’s fragility in this regard.
Investing in public transport
Yet, this crisis presents an opportune window for Malaysia to facilitate a modal shift away from private-vehicle reliance.
The RM4 billion could be funnelled into urban mobility efforts, capable of activating mobility beyond motorised vehicle dependence.
Investments, however, must reflect this sentiment.
While investments in public roads have historically been at the forefront of transportation-related budgetary expenditure, the same cannot be said about public transport.
Development expenditure allocation for public transport has contracted over the last few years, highlighting disparities in commitment.
Prasarana has also suffered from service cuts. Since January, 29 feeder bus routes have been terminated.
While Prasarana recorded an 11% passenger increase in 2025, adoption of public transit uptake remains relatively low, at only 19%. When compared against regional peers, such as Hong Kong and Singapore, Malaysia is a laggard.
Shrinking budgets for public transport-related costs contradicts Malaysia’s target of achieving a 40% public transit modal share by 2030, while exposing the transit network to additional shocks.
This is apparent, with Rapid KL train lines facing up to eight disruptions a month on average.
Beyond maintaining fuel subsidies, car-dependence exacts a public health cost. Air pollution – of which roughly 70% in the Klang Valley is attributed to cars – costs an estimated RM303 billion annually in public health-related costs.
Cost of car dependency
Moreover, road accidents are a major concern with statistics showing that they are the leading cause of fatal burden and diseases among males aged five to 29. Data suggest that increased investment into multimodal transport infrastructure can reduce road accidents significantly, as it facilitates the safe and efficient movement of people across a multitude of travel environments.
The World Health Organisation’s Malaysia country report also found that motorists made up the lion’s share of road crash fatalities at 83%.
Seen through this lens, the government stands to benefits immensely if it were to invest more in the public transit network via increased expenditure, when viewed through both economic and public health perspectives.
To further enable this shift public transport must be viewed through a lens of social spending.
Similar to how all levels of society utilise public roads, the same courtesy should be afforded to other transport modalities. Roads themselves impose larger financial costs over time to the taxpayer due to construction and long-term maintenance costs but are rarely expected to generate direct financial returns.
Inversely, discussions surrounding public transit are constantly framed within the loss-profit paradigm. Headlines highlight how Prasarana, MRT Corp and KTMB record multi-year losses because of low fares.
Future of mobility
Viewing public transit from a profit-and-loss angle does not benefit the wider discussion regarding public transit usage and upkeep. Mobility in all its forms is critical not only as a tool to stimulate economic growth but also as a form of public service.
Beyond maintaining the fuel subsidy, Malaysia lacks a plan for the future of its mobility. Promises to expand Prasarana’s bus fleet are disjointed from efforts to improve first-and-last-mile access to feeder buses – a proven approach to increasing public transit uptake.
An approach to address this gap is for increased coordination between bus operators with city councils to address reliability concerns. At its core, service reliability is the largest hindrance limiting increased public transport uptake, based on extensive research.
Ultimately, a continued reliance on fuel subsidies to facilitate movement risks exposing Malaysia to continued shocks, as the future becomes more uncertain due to geopolitical tensions. Therefore, a radical shift in how we approach city planning away from car-centric infrastructure is key.
The present is an inflection point for the government to reassess how it views public transport’s role in the lives of Malaysians.
Public transport should not be seen as supplementary to the wider mobility framework but should be deserving of both budgetary and institutional backing.
An earlier version of this article was first published on The Star.
