Malaysia's Prime Minister Mahathir Mohamad is seeking to hike the price of water sold to neighbouring Singapore by more than 10 times in a bid to pay off his country's massive debts.
Mahathir, who reclaimed power in a May electoral upset, has told The Associated Press that a decades-old treaty governing the water agreement needs to be revised to reflect increased living costs.
The water deal has long been a point of contention between the two countries. Mahathir said in June he wants to renegotiate the deal.
Malaysia currently sells water to Singapore at 3 sen (0.7 US cents) per thousand gallons and buys treated water at 50 sen (US 12 cents) per thousand gallons.
Mahathir said that by comparison, the southern Malaysian state of Johor sells water to the neighbouring state of Melaka at 30 sen per 1,000 gallons - a rate he described as "charitable" given that it's a domestic deal.
"To a foreign country, we need to get more than that," he said. He declined to discuss specifics, citing ongoing negotiations.
Singapore Foreign Minister Vivian Balakrishnan has said his country will live up to the agreement and expects Malaysia to do the same.
Mahathir also continued to cast doubt on the value of a high-speed rail project linking the Malaysian capital, Kuala Lumpur, to the wealthy island city-state. He announced the cancellation of the project in May as part of a wider review of big-ticket infrastructure deals reached under his predecessor, Najib Razak, though the government has since reconsidered and is trying to renegotiate the terms.
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