Johor yesterday launched a RM20 billion (S$6.7 billion) plan to transform Johor Baru's old city centre into an international business district.

Over the next decade, the Ibrahim International Business District (IIBD) will emerge in the area, located just after the former Johor checkpoint at the end of the Woodlands Causeway. It is named after Johor Sultan Ibrahim Ismail, who celebrated his 57th birthday yesterday.

The JB city centre currently has a mix of narrow streets, old shophouses and upgraded malls such as Komtar JBCC and City Square.

The IIDB aims to improve infrastructure in the area and dot it with newer towers to leverage on its proximity to Singapore and lower costs, officials said.

"Apart from being one of the main gateways into the country, Johor Baru is located next to one of the most advanced and developing metropolises in the world, Singapore," Johor Menteri Besar Mohamed Khaled Nordin said at the project's launch, which was attended by the Johor ruler.

It is his hope, Datuk Khaled said, that IIBD will raise Johor Baru's status to become "the Second Kuala Lumpur".

The project is backed by the state's investment agency Johor Corporation, a big landowner in downtown JB, with several private developers also expected to join in.

One of the smaller projects already under way is the clean-up of Sungai Segget, one of Malaysia's dirtiest rivers, along the main downtown JB road by rediverting sewage pipes and improving its water flow. Just last week, that part of JB was inundated with dirty flood water after heavy rains.

Officials are also looking to link the malls and major buildings in the area with overhead pedestrian bridges, which some have dubbed Skywalks, similar to the popular pedestrian walkways in Bangkok.

Officials said the jewel of the upcoming business district will be a RM3 billion complex called Coronation Square. It will come up on the site of the old bus and taxi terminal, just half a kilometre from the city's transport hub and new immigration checkpoint at JB Sentral.

The 2.6-ha Coronation Square, so named to commemorate the coronation of Sultan Ibrahim in March, will contain serviced apartments, an office tower, a hotel and retail podium and a "medical suite".

Unlike a hospital, the medical facilities will offer mainly outpatient services.

It will have modern medical services along with traditional treatments such as ayurveda and acupuncture, and be marketed to international patients, said Johor Corp's president and chief executive Kamaruzzaman Abu Kassim.

The IIBD is a step away from the recent raft of residential projects launched in Nusajaya, the upcoming Johor downtown close to the Tuas Second Link.

Nusajaya today contains the new state legislature complex, government offices, landed homes and condominiums popular with Singaporeans, along with hotels and international schools.

And there are also several big coastal projects facing Singapore containing thousands of condominiums being built by major Chinese property players.

Asked whether the JB business district will add to concerns about over-building in Johor, Datuk Kamaruzzaman said while Nusajaya is located to the west of the state, the business district plan is about rejuvenating the east.

"JB is the state capital of Johor and it needs much improvements compared to Nusajaya and what's happening in other parts of Johor," he told reporters.

"Unlike some other developed cities, you don't see people with a certain degree of purchasing power in the Johor capital."