EPU shot down 1MDB's three-page proposal for RM3b grant
NAJIB TRIAL | 1MDB submitted a three-page letter to the Economic Planning Unit (EPU) to seek a RM3 billion grant for its subsidiary SRC International Sdn Bhd, the Kuala Lumpur High Court heard today.
Witness Kamariah Noruddin, who was previously the deputy director-general (macro) of EPU, described the application on Aug 7, 2010 as "out of the ordinary".
NAJIB TRIAL | 1MDB submitted a three-page letter to the Economic Planning Unit (EPU) to seek a RM3 billion grant for its subsidiary SRC International Sdn Bhd, the Kuala Lumpur High Court heard today.
Witness Kamariah Noruddin, who was previously the deputy director-general (macro) of EPU, described the application on Aug 7, 2010 as "out of the ordinary".
"(I found that) the application was hard to process as it was out of the ordinary. It was an application by 1MDB to the minister of finance and prime minister (Najib Abdul Razak), which was then forwarded (to the EPU).
"The 1MDB letter was signed by Shahrol Azral Ibrahim Halmi, the chief executive officer (of 1MDB), (and addressed to) Najib," said the witness, while under examination by DPP Mohd Ashrof Adrin Kamarul.
She testified that her superior Noriah Ahmad had received instructions from Nor Mohamed Yakcop, the minister in charge of EPU at the time, to work on the application.
The amount sought, said Kamariah, would have constituted seven percent of the government's development allocation for the year.
"In EPU, we cannot at that juncture provide the (RM3 billion) grant as it was only a three-page proposal to get the RM3 billion grant.
"Allocation for development is RM42 billion for the entire nation annually.
"Take RM3 billion out of this, it would be seven percent of the development budget of the entire nation.
"If the RM3 billion grant is given to a company not yet formed, it would be negligence on EPU's part," she said.
SRC International was formally established as a 1MDB subsidiary on January 7, 2011.
Kamariah, who was in charge of EPU's energy division at the time, said SRC had planned to be involved in the production, logistics, and trading of key resources such as oil, gas, coal, and iron, among others.
However, she said, this would have conflicted with existing roles held by other government agencies such as Petronas, which was already in the oil and gas business.
The EPU further believed that the iron and aluminium business should be left to the private sector, she added.
In view of this, EPU turned down the application for the RM3 billion grant, and extended RM20 million instead to SRC for its launch.
