(AFP) - The company building a monorail in the Malaysian capital said today it has secured a RM620 million (US$163 million) loan for the RM1.18 billion project.

KL Monorail System Sdn Bhd said in a statement the loan came from Bank Pembangunan dan Infrastruktur Malaysia Bhd.

The 8.6km monorail project started in January 1997 but was hit by the regional financial crisis of 1997/98.

Work stopped for a year until the government provided a RM300 million soft loan in 1999. The rest of the money is to come from equity capital of RM260 million.

The monorail, running above main roads, will serve the commercial, shopping and tourist districts of Kuala Lumpur and is expected to be operational in July 2002.

It will link up with two existing light railway lines, the national railway and a planned new express railway to the international airport.

Last month the government suspended controversial plans to issue bonds worth RM6 billion to rescue the two debt-ridden light railway operators.

It is awaiting an alternative debt restructuring programme.

Public transport in the traffic-clogged city of 1.5 million currently consists of the 56km of light railways, plus buses.