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Photographer: Charles Pertwee/Bloomberg Photographer: Charles Pertwee/Bloomberg

Malaysia signed a deal with developers to restart the $34 billion Bandar Malaysia project which languished for years after being conceived under the oversight of troubled state fund 1MDB.

A consortium comprising Iskandar Waterfront Holdings Sdn. and China Railway Engineering Corp. will acquire 60% stake in the venture for 6.45 billion ringgit ($1.6 billion). That’s based on Bandar Malaysia’s 12.35 billion ringgit land value and accounts for its 1.6 billion ringgit outstanding debt. The joint venture known as IWH-CREC Sdn. will make payments over three years instead of the earlier agreed seven.

“It is my fervent hope that the project will be successful and our people will reap the benefits that it brings about,” Prime Minister Mahathir Mohamad said after witnessing the signing of the agreement in the administrative capital of Putrajaya.

The project, which is part of the Belt and Road Initiative, has drawn the interest of Chinese tech giants Alibaba Group Holding Ltd. and Huawei Technologies Co. It has an expected gross development value of 140 billion ringgit and was intended to be the hub for the now-suspended high speed rail that would connect Kuala Lumpur and Singapore.

The development stalled in 2015 when 1MDB struggled to fund the project amid corruption probes. The state fund attempted to sell a major stake to developers IWH and China Railway but the deal fell through over a dispute relating to payments in 2017. Malaysia revived the project this year to bolster economic growth after a cut in public spending hurt consumption.

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Under the new deal, the developers will be required to build 10,000 affordable homes as well as 85 acres (34 hectares) of park and recreational area, Finance Minister Lim Guan Eng said. While the developers own 60% of the project, they’ll have to pay half the dividends received from the venture to the government, he said.