A booth of China South Locomotive and Rolling Stock Corporation Ltd is seen at an exhibition in Beijing. [File photo by Wu Changqing / Asianewsphoto]

BATU GAJAH, Malaysia - China's leading railway car manufacturer, China South Locomotive and Rolling Stock Corporation Ltd, or CSR, started the building of its $131 million ASEAN manufacturing and maintenance center in Malaysia on Tuesday.

Malaysian Prime Minister Najib Razak, officiating the ground breaking ceremony in Batu Gajah of Perak State, said the project is a result of the good bilateral relations between Malaysia and China.

"The first phase of the project, valued at 400 million ringgit ($131 million), would create 800 jobs," he told local residents and railway employees. The ASEAN rail center would cover all-in-one scope of work of production, assembly, testing, overhaul and refurbishment.

The first phase of the project is expected to be completed by mid-2014, with the annual capacity of the production of 100 carriages and the overhaul of around 150.

Zhou Qinghe, general manager of CSR Zhuzhou Electric Locomotive Co Ltd, or CSR ZELC, a CSR subsidiary and an active player in Malaysia's mass transit projects, said the company is eyeing Malaysia as the base to promote its products in other Southeast Asian countries.

CSR ZELC has won the bid for 20 sets of light rail vehicles for Malaysia's AMPANG Line Extension Project, and the cars will be among the first to be manufactured by the new plant.

"We managed to become accredited in the country after several years of good cooperation with Malaysia," Zhou told Xinhua.

The agreement signed between the Malaysian government and the company last year also involves technical cooperation in railway engineering and technology, as well as human resources training.

CSR, based in Beijing and listed on Hong Kong and Shanghai stock markets, has been developed into one of the major players in the global railway transport industry and is one of the biggest by global sales revenue.