The report quoted Singapore Foreign Minister Vivian Balakrishnan as saying in Parliament today that the 1962 deal was “not an ordinary agreement.”

“The 1962 Water Agreement was guaranteed by both Singapore and Malaysia in the 1965 Separation Agreement, which in turn was registered with the United Nations,” he said.

“Any breach of the 1962 Water Agreement would call into question the Separation Agreement, which is the basis for Singapore’s very existence as an independent sovereign state.”

Balakrishnan noted that previous foreign ministers have stated Singapore’s position on this issue comprehensively – Professor S Jayakumar in 2003 and K Shanmugam in 2014.

“As was stated then, the core issue is ‘not how much we pay, but how any price revision is decided upon’,” said Balakrishnan.

“Neither Malaysia nor Singapore can unilaterally change the terms of this agreement between our two countries.”

According to the news report, it costs Singapore RM2.40 to treat every 1,000 gallons of water.

By selling it to Malaysia at 50 sen, Singapore is providing a subsidy of RM1.90 per 1,000 gallons.

Having bought treated water, Johor then sells it at RM3.95 per 1,000 gallons, earning a profit of RM3.45 per 1,000 gallons, or RM46 million a year, said the report.

Malaysia Prime Minister Dr Mahathir Mohamad had last month criticised the 1962 water supply deal with Singapore as “too costly”, possibly seeking to renegotiate the agreement.

Meanwhile, Johor Menteri Besar Osman Sapian said the new price was likely to be the same as the raw water price set for the Melaka government, that is 50 sen for every 1,000 gallons.

According to the water agreement between Malaysia and Singapore, which expires in 2061, Malaysia supplies Singapore with 250 million gallons of raw water daily at 3 sen per 1,000 gallons.

Malaysia then re-purchases a portion of the supply that had been treated at 50 sen per 1,000 gallons.