KUALA LUMPUR, July 16 — The government has assured it would approve data centre projects only upon ensuring energy and water supplies are sufficient to meet the people’s and industry needs, said Deputy Investment, Trade and Industry Minister Sim Tze Tzin.
He said the Data Centre Task Force (DCTF) was established to study the entire data centre ecosystem by examining each application based on power and water supply capacity before approval is granted.
He said the government is responsible for ensuring data centre energy requirements do not burden the people, while the water supply will continue to be prioritised for residents before any approval is given to data centre companies based on the existing surplus capacity.
“Water supplies must be prioritised for residents and Malaysians. Only when there is excess capacity will we approve it for the data centre firms,” he explained.
Sim said this in reply to a supplementary question from Datuk Ku Abd Rahman Ku Ismail (PN-Kubang Pasu) in the Dewan Rakyat today about how the government plans to mitigate energy and water usage by data centres so it doesn’t affect long-term resident and industry water needs.
Sim noted that Malaysia still has excess supplies to meet demand from projects whose applications are handled by the DCTF.
Earlier, he said the National Semiconductor Strategy (NSS) has begun to show encouraging results, with approved investments in the semiconductor sector reaching RM91.9 billion between January 2024 and March 2026.
He highlighted that foreign direct investment amounted to RM82.9 billion, while domestic direct investment totalled RM8.9 billion.
“The government is also focusing on talent development with a target of training 60,000 workers. By December 2025, 18,062 local talents had been trained, reflecting encouraging progress and keeping the initiative on the right track,” he added.
He said this in response to a question from Chong Zhemin (Harapan-Kampar) about how the government plans to draw new investments in the semiconductor and AI sectors to ensure Malaysia remains regionally competitive.
